- 3 updates
The Public Accounts Committee noted that the Treasury had managed to cut the public purse's exposure to bank guarantee schemes in the wake of the credit crunch, and was doing better at holding on to key staff.
However, the Government was still facing a £34 billion loss on shares in RBS and Lloyds, and there were doubts as to whether the department had "sufficient capacity and skills" to respond to any future banking crisis.
Plans for more job cuts and high turnover of personnel threatened its "ability to effectively control the risks it is managing on behalf of the taxpayer".
Desperate government attempts to stimulate the economy have been criticised as "expensive experiments" by an influential group of MPs.
The Public Accounts Committee (PAC) said the Treasury did not seem to understand the risks and benefits of £375 billion of quantitative easing (QE), while its flagship lending guarantee scheme had failed.
The department was also rebuked for not getting a grip on spending across Whitehall, and "impenetrable" book-keeping.
The verdict was delivered in the cross-party committee's report into the Treasury's performance in the last financial year.