Fifteenth Report - Managing government borrowing
Select Committee
Public Accounts Committee
HC 74
5 March 2024
Government response
Treasury minutes: Government response to the Committee of Public Accounts on the Fifteenth report from Session 2023-24 · published 3 May 2024
Recommendations & Conclusions
6 results
6
Conclusion
Deferred
NS&I lacks a suitable alternative to its discontinued Value Indicator performance metric.
Conclusion
To deliver its remit, NS&I must balance the interests of savers by offering a fair return, and the interests of the taxpayer by minimising finance costs. At the same time, it must also maintain an appropriate competitive position in the …
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Government Response Summary
The government agrees with the implicit recommendation to improve performance measurement. It commits to examining international best practice and assessing quantitative and qualitative measures by Spring 2025, and will write to the Committee upon conclusion of this analysis.
HM Treasury
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8
Recommendation
Deferred
CMA provisionally found major banks broke competition laws affecting DMO gilt auctions.
Recommendation
In May 2023, the Competition and Markets Authority (CMA) provisionally found that five major banks broke competition laws on UK gilts. Each bank allegedly unlawfully shared competitively sensitive information relating to the buying and selling of UK government gilts. The …
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Government Response Summary
The government accepts the implicit recommendation and commits to writing to the Committee with the requested information within two months of the CMA's investigation concluding, but the target implementation date is TBD due to the CMA's open-ended timeline.
HM Treasury
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9
Conclusion
Deferred
DMO cannot police GEMM behaviour effectively, making no changes despite manipulation risks.
Conclusion
The DMO stressed that it expected all GEMMs to “adhere 100%” to all regulations and the applicable laws, but because the DMO is not itself a regulator it cannot police the behaviour of the GEMMs. It added that GEMMs, which …
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Government Response Summary
The government agrees with the implicit recommendation and commits that HMT and DMO will write to the Committee with information within two months of the Competition and Market Authority’s investigation conclusion, deferring any further actions until then.
HM Treasury
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10
Conclusion
Deferred
OBR highlights need for more information on overseas UK gilt ownership for risk management.
Conclusion
We asked the OBR whether any improvements could be made to government’s borrowing processes. The OBR expressed a desire for more information on the owners of UK gilts held overseas, which it said represented arounds 25% of all UK debt …
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Government Response Summary
The government claims the recommendation is implemented, stating it currently lacks visibility of beneficial gilt owners. However, it commits to reviewing sovereign bond ownership data from other countries to learn from their approaches.
HM Treasury
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11
Conclusion
Deferred
Treasury and DMO lack accurate data on ultimate beneficial owners of overseas gilts.
Conclusion
We asked the Treasury how much it knew about the owners of UK debt held overseas. The Treasury recognised that it did not have a “very accurate picture” because gilts were a “traded commodity” and may be sold on. The …
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Government Response Summary
The government claims the recommendation is implemented, stating it currently lacks visibility of beneficial gilt owners. However, it commits to reviewing sovereign bond ownership data from other countries to learn from their approaches.
HM Treasury
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16
Conclusion
Deferred
Government gilt redemptions peaking in 2024-25, challenging DMO's cash management function.
Conclusion
Not only does the government face growing pressure to borrow more in the future, but it also needs to ensure it can repay its current debts. The DMO issues gilts of varying length, ranging from one to more than 50 …
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Government Response Summary
The government agrees with the implicit recommendation to improve performance measurement. It commits to examining international best practice and assessing quantitative and qualitative measures by Spring 2025, and will write to the Committee upon conclusion of this analysis.
HM Treasury
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