Northern Rock breaks ‘40%’ sustainable investment rule

breaking Gordon Brown’s ‘sustainable investment’ rule imposed since 1997.

But the Office for National Statistics maintains it cannot judge whether the
‘indicative figure’ of £90.7 billion, which takes debt ‘to the range of 43 or
44%’ would break the rule.

Speaking before a cross-party select committee today, ONS public accounts
adviser Martin Kellaway said: ‘Whether the rule is broken or not is not my
judgment. We’re just producing the statistics. It’s the Treasury that has
responsibility on whether the fiscal rules are met or not.’

Northern Rock’s inclusion in government debt is set to add £100bn to net debt
of £514bn, which is also 35.9% of GDP.

Kellaway and executive director at ONS, Colin Mowl, also admitted that
Treasury had not consulted their office on how Northern Rock’s debt would be
treated in the Budget next week, but admitted a ‘discussion’ had been held with
a Treasury member over the phone over publishing a set of figures with and
without Northern Rock’s figures.

Further reading:

Off balance sheet Rock would be ‘outrageous’

MPs to probe off balance sheet deals

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