How far does the size and shape of HMG’s balance sheet influence long term interest rates and metrics of fiscal sustainability?

Background

Fiscal Policy covers a wide-ranging set of issues at the heart of HM Treasury’s objectives and of fiscal events such as Budgets. Good fiscal policy must ensure the sustainability of the government’s finances, oversee its macroeconomic policy framework, and carry out a stable and efficient financing of government liabilities. HM Treasury’s work in this area includes advising the Chancellor on the appropriate levels of borrowing and debt (as well as broader commitments like guarantees & insurance), providing analysis of the government’s finances and overseeing financing raised for the government by the Debt Management Office and National Savings & Investments.