HC Deb 12 November 1975 vol 899 cc791-4W
Mr. Nott

asked the Chancellor of the Exchequer:

  1. (1) If he will publish a table showing, from international sources of information available to him, estimates of the percentage of the gross national product represented by the financial deficit of the public sector and the public sector borrowing requirement in the 1975 calendar year for each of the nine EEC countries, the United States of America and Japan;
  2. (2) If he will publish a table showing, from international sources of information available to him, the percentage of the gross national product represented by Consolidated Fund expenditure or its nearest equivalent in other countries up to the latest available date in the current financial year of each of the nine EEC countries, the United States of America and Japan;
  3. (3) If he will publish a table showing, from international sources of information available to him, the percentage of the gross national product represented by:
    1. (1) The financial deficit of the public sector and:
    2. (2) The public sector borrowing requirement at the date of the last annual budget for each of the nine EEC countries, the United States of America and Japan.

Mr. Joel Barnett,

pursuant to his reply of Tuesday 11th November, gave the following reply:

As I explained in my reply to the hon. Member for Horsham and Crawley (Mr. Hordern) on 27th October, international comparisons of public sector financial balances are difficult because of differences in coverage and definition and because of statistical difficulties. The same is naturally true for component estimates of public sector expenditure. Some limited degree of comparison can eventually be achieved by use of the concept of the general government sector from the UN/OECD system of national accounts. But official national figures on this basis are, of course, not yet available for the current year.

The table below sets out the information which is available from published sources about central Government expenditure and the central Government financial balance as estimated by the Government concerned at the time of their main budget for 1975. In the case of the United Kingdom, central Government expenditure is larger than Consolidated Fund expenditure because the latter excludes most lending to local authorities and the public corporations and expenditure on contributory social security benefits—both of which are generally excluded from other countries' definitions of central Government expenditure—and most expenditure in Northern Ireland.

The table also shows the most recent official estimate of the central Government financial balance. This may be helpful in demonstrating the extent to which official forecasts of this balance have changed during the course of the year. But, for the reasons given above, the figures for individual countries are not comparable with each other. The definitions are those used in each country's own budget presentation. The figures therefore would require a greater or lesser degree of adjustment to put them on to a national accounts and a general government basis. Broadly speaking, these adjustments could be expected to increase the size of the expected deficits.

Comparable official figures of public sector borrowing requirements, which differ from public sector deficits to the extent that there is net lending to other sectors, are not available for the current year.

OFFICIAL FORECASTS OF CENTRAL GOVERNMENT EXPENDITURE AND FINANCIAL BALANCES IN 1975*
Central Government Deficit
Central Government Expenditure At time of main 1975 budget Most recent published official estimate GNP Column 1 as percentage of Column 4 Column 2 as percentage of Column 4 Column 3 as percentage of Column 4
1 2 3 4
United States† ($ billion) … … 367 −68.8 −75 to−90 1,467 25.0 4.7 5.6 to−6.1
Japan‡ (Yen billion) … … 21,300 −2,010 −5,490 143,350 14.9 1.4 3.8
Germany (DM billion) … … 155.1 −25.7 −40.9 1,048 14.8 2.5 3.9
France (Francs billion) … … 259.3 +0.4 −39.6 1,493 17.4 — 2.7
Italy (L billion) … … 22, 499 −7,172 −7,172 114,114 19.7 6.3 6.3
Belgium (B Fr billion) … … 606.4 −60.7 −81.0 2,128║ 28.5 2.9 3.8
Netherlands (G billion) … … 61.8 −3.6 −8.7 206║ 30.0 1.7 4.2
Denmark (Kr billion) … … 67.9 −9.4 −10.6 210║ 32.3 4.5 5.0
Ireland (£ million) … … 1,561 −431.6 −578 3,668║ 42.6 11.8 15.8
United Kingdom§ (£ billion) … … 43.7 −41 — 101.5 43.1 4.0 —
* Except in the cases of the United States, Japan and the United Kingdom, fiscal year 1975 is the same as calendar year 1975.
† Fiscal year ending 30th June 1976. A recent independent forecast estimated the Federal deficit in calendar year 1975 as $74 billion. The figures in columns 1 and 2 are Congress estimates.
‡ Fiscal year ending 31st March 1976. Calendar year estimates are not available. The figures shown essentially cover current expenditure. Capital expenditure under the Fiscal Investment and Loan Programme (FILP) was originally estimated at Yen 9, 300 billion in fiscal year 1975–76 and has recently been estimated at Yen 10, 650 billion.
§ Fiscal year ending 31st March 1976. For column 1 see FSBR Table 14. For column 2 see FSBR Table 6. Consolidated fund expenditure in 1975–76 was estimated at the time of the Budget at £30.9 million at Estimates prices, see FSBR Table 7.
¶ To give some measure of comparability, the estimates of GNP are taken from forecasts published by the OECD Secretariat in the Economic Outlook for July 1975. The figures relate to the calendar year 1975 and are not therefore strictly comparable with the fiscal year figures in the cases of the United Kingdom, the United States and Japan.
║GDP.