Proposals for Reforms to the Debt Management Office's Financing Remit
Year: 2025
Type: article
Abstract: This paper proposes reforms to the UK Debt Management Office's (DMO) financing remit to reduce Exchequer costs without austerity. It argues the current rigid, auction-based system is inefficient and misaligned with market demand, based on an outdated view of government finance. We recommend an Open Issue System (OIS), a dynamic, demand-driven model for the continuous issuance of gilts and Treasury bills in direct response to market bids. By phasing out Gilt-edged Market Maker privileges and broadening market access, the OIS would lower borrowing costs, reduce volatility, and enhance fiscal space. These significant reforms can be implemented administratively under existing statutory authority, offering a practical path to fiscal improvement.
Author: The Gower Initiative for Modern Money Studies
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W7091534357
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