The purpose of the Act is to:
- Put the Government's deficit reduction plan on a statutory footing, in order to half the deficit over 4 years and put debt on a sustainable path in the medium term.
The main benefits of the Act are:
- The new legislation would provides a firm and binding statutory basis for the Government's consolidation plans, creating a duty to meet them . It constitutes a major change to the structure of fiscal policy, especially through giving Parliament power to approve multi-year fiscal plans. Accountability and scrutiny is through Parliament rather than in any new external body.
- Legislating now demonstrates our commitment to sustainability and adds focus to our plans. It is important that businesses and investors have certainty about the Government's fiscal plans, in order that they can make long-term plans and decisions with confidence. The Fiscal Responsibility Bill provides this.
