Dr. Robert Sweeney:

Can I just give one very quick answer? In terms of privatisation, what is being proposed is a net expenditure rule that would exclude one-off revenue gains. Presumably, privatisation would not enable a country to meet its net expenditure rules because one-offs are excluded. That is my understanding of it.

In terms of the debt sustainability analysis and the assumptions that go with it, one such assumption is based on the fiscal multiplier or the knock-on effect of government spending on output. If I recall correctly, the assumption is a multiplier of 0.75, whereas many economists would put that higher. It might well be the case that the debt sustainability analysis is underestimating the effect of reductions in government spending on outputs. One issue that might be challenged is whether the assumption about the multiplier is actually accurate. One of the critiques of the debt sustainability analysis is that it is very sensitive to small tweaks in the assumptions and the stress tests. The issue is the debt paths after the debt sustainability analysis. For example, a debt sustainability analysis for Italy was done in 2016 and another one was done in 2019. Not a whole lot changed in the three intervening years but there was a big change in the estimated debt trajectory in that period. There does seem to be an issue as to the very large variation in projected debt paths in the debt sustainability analysis.