Why it is of concern

There are several recognised bodies who have offered their views regarding our finances. The Office for Budget Responsibility (OBR) was established in 2010 to examine and report on the sustainability of the public finances. It produces reports relation to fiscal risks and sustainability. In its July 2025 report it stated: 

'Efforts to put the UK's public finances on a more sustainable footing have met with only limited and temporary success in recent years'

'The result has been a substantial erosion of the UK's capacity to respond to future shocks and growing pressures on the public finances. Underlying public debt is now at its highest level since the early 1960s and is projected to rise further over the medium term. Arresting this increase has become considerably more challenging as economic growth has slowed and interest rates risen. Despite the tax-to-GDP ratio rising to the highest level in the period since 1950, borrowing is still 3 per cent of GDP above the level that would be needed to durably stabilise debt. And the Government has left itself very small margins against its objectives of restoring the current budget to balance and getting net financial liabilities to fall by the end of the decade. Despite this, public expectations of what government can and should do in response to emerging threats and future emergencies seem to be rising'.

'There are signs that the scale of public borrowing in the UK and other large, advanced economies is putting global sovereign debt markets under pressure. Government borrowing costs have risen across the world and long-term gilt yields are now higher in the UK than at any point since the start of the century'.

'Over the long term, the demographic pressures of an ageing population and rising costs of healthcare and other age-related expenditures are still, on current policy settings, projected to push borrowing above 20 per cent and debt above 270 per cent of GDP by the early 2070s'.

The report is very detailed and outlines a number of the risks we are exposed to. 

Whilst there are major issues at play governments tend to focus more on the smaller financial issues rather than the larger one. These are easier (relatively speaking) to address. They have increasingly avoided the dealing with the scale of the debt, spending commitments and very significantly the financial risks. They appear to wait for the risks to manifest themselves then present a stance of 'coming to the rescue' rather than properly managing the risk. I large private sector projects risks are identified and costed with money set aside based on the potential magnitude and probability of them occurring. There is no indication that government are doing this. It is concerning that they are not taking significant steps now to improve the fiscal position ahead of any major national events occurring.