BusinessCompany NewsBrown accused of hiding £100bn

Brown accused of hiding £100bn

Howard Flight, shadow chief secretary to the Treasury, has accused Gordon Brown of hiding over £100bn off the government balance sheet.

Link: Pre-Budget special report

Speaking to Accountancy Age after the chancellor’s pre-Budget report, Flight said that along with £21bn worth of Railtrack debt, Brown will owe an extra £10bn for the new west coast rail line as well as huge sums of money from PFI commitments.

‘The whole lot is off balance sheet,’ he said. ‘There are unexplained notes on the PFI commitments in the red book, but that is all.

‘The only way he can get out of that one [not having already broken his golden rule] is to say ‘my golden rule is on the basis of having that much off balance sheet’. He’s a very devious man,’ Flight said.

Ian Mitchell, an economist at the Centre for Economic Business Research said that while Flight had a point, Brown was not strictly breaking any rules.

‘In one respect that’s accurate, and in another that’s the whole idea of it,’ said Mitchell. ‘The idea being to spread the cost, and share the risk with the private sector.’

Mitchell said that part of the criticism stems from the government not making it clear what it has done. ‘It seems as if they have tried to sweep it under the carpet,’ he said.

When asked from an economic point of view whether the PFI money amounts to unaccounted debt, Mitchell said: ‘Yes, that’s fair to say.’

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