The Treasury has published an unaudited summary of the Whole of Government Accounts (WGA) for the year 2009-10. The Government made available the key balance sheet analysis contained in this summary to the Office for Budget Responsibility (OBR) to enhance their analysis of the sustainability of the public finances in their first ever Fiscal Sustainability Report, also published today.
This is the first ever set of publication of information for the whole of the public sector, covering over 1,500 public bodies, and has been 10 years in the making. The full, audited accounts will be published in the autumn and will be the most ambitious in scope produced in any country.
The publication of this summary represents a leap in the transparency of reporting the Government’s future liabilities. It represents a snapshot of the Government’s financial position on a commercial accounts basis. Its aim is to enable Parliament and the public better to understand and scrutinise how taxpayers’ money is spent.
While the new information it presents does not affect the fiscal position, the analysis it includes on, for example,Private Finance Initiative (PFI ) and public service pension liabilities makes clear the scale of the fiscal challenge the Government faced before the June 2010 Budget.
The Accounts show that the public service pension liabilities as of 09/10 were £1.1 trillion pounds.
They also show that PFI capital liabilities as of 09/10 were over £35 billion. The OBR’s assessment in their Fiscal Sustainability Report is that these liabilities relate to about 90 per cent of all operational PFI assets, which suggest the total capital liability was closer to £40billion. The difference arises due to the internationally recognised accountancy standards used in WGA
Welcoming the publication of the OBR’s report and commenting on the publication of the WGA, the Chancellor of the Exchequer, George Osborne, said:
“The information published today by the Treasury and the OBR represents a step change in transparency , lifting the lid on the liabilities built up in the past and the pressures we face in the future. They show that our deficit and reform plans are not just right for the economy now, but also right for the economy and fair for the country in the future.”