An accounting change over road repairs has given Gordon Brown a timely £3bn boost in the run up to this month’s pre-general election Budget on 16 March.
The Office for National Statistics (ONS) announced yesterday said that it had removed some double counting of depreciation in the accounts of the Highways Agency, which builds and maintains motorways and trunks roads.
This is worth about £400m a year, and has the effect of cutting current spending and increasing investment spending. The accounting change will reduce current public sector spending by about £3bn over the seven years of the economic cycle.
The chancellor announced in last December’s pre-Budget report that he would meet his ‘golden rule’ by a margin of £8bn but he said that he would not be relying on the ONS’s change to meet his promise.
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