The OMFIF Podcast How to make public investment work
Sep 10, 2025
Dean Yates, a public sector debt expert at EY, and Rainer Kattel, a governance specialist at UCL, dive into the pressing challenges of public investment in today's fiscal climate. They discuss strategies for optimizing investments to maximize social impact while maintaining fiscal sustainability. The conversation highlights the role of innovative technologies in enhancing governance, with practical examples of digital transformations that improve transparency and decision-making. It's a thought-provoking exploration of how governments can better allocate resources for the common good.
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Global Debt Pressures And Fiscal Sustainability
- Public sector debt is high globally and rising, driven by geopolitics, higher interest rates and spending pressures.
- Fiscal sustainability and credible long-term finances are essential to economic stability and growth.
Unequal Fiscal Space And Automation Risks
- Countries with their own currencies and wealthier economies have more fiscal leeway than smaller nations.
- Automation and AI risk reducing jobs where we currently invest, increasing the need to fund care and welfare services.
Where Public Investment Multiplies Most
- High public multipliers exist in defence R&D and the care economy, not only in traditional infrastructure.
- Public housing and social needs still require direct public investment despite lower infrastructure multipliers.