BusinessCompany NewsGovernment accounts to include pension liabilities

Government accounts to include pension liabilities

Chancellor Gordon Brown is about to add £350bn to the government's books to comply with FRS17 and record unfunded public sector pension liabilities.

Link: More on FRS 17

The intention was confirmed by financial secretary Ruth Kelly in a robust defence to Tory accountant MP Mark Hoban’s taunt that the ‘iron chancellor’ has become the ‘Enron chancellor’ by structuring accounts to keep Network Rail and some PFI deals off the government’s books.

In a House of Commons debate last week, shadow Treasury minister Howard Flight said Hoban was right to complain about ‘Enron accounting’ practices being used to structure transactions to keep them off balance sheet.Turning to the issue of the accounting treatment of pension fund liabilities he challenged Kelly to confirm it is the government’s intention to comply with the standard on pensions in next year’s whole of government accounts.

Kelly said the whole of government accounts would be GAAP-based, adding: ‘They will show public sector pension liabilities in their fullest form.’

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