HC Deb 30 January 1984 vol 53 cc43-4W
Mr. Dover

asked the Chancellor of the Exchequer what was the level of Government capital investment as a proportion of national output in the United Kingdom in 1970, 1975, 1980 and the latest available year; and if he will compare this figure with any similar information he has regarding, France, Germany, Japan and the United States of America.

Mr. Peter Rees

International comparisons of public expenditure should be treated with caution because of differences in the composition of expenditure and in governmental organisation. For example, although United Kingdom expenditure on defence is higher than in any other NATO country, with the exception of United States, and much of that expenditure is of a capital nature, under international conventions for national accounting expenditure on defence is mostly classified as current expenditure. The United Kingdom figures are also affected by special sales of assets which under current conventions reduce net capital expenditure.

The figures in the table following need to be read with these qualifications in mind. The United Kingdom figures would be 2.9 per cent., 2.2 per cent. and 2.4 per cent. for 1980, 1981 and 1982 respectively if the revenue from council house sales were not netted off. It is not known if the figures for other countries are also affected by special factors.

The following information is available:

General Government* capital investment† as a percentage of gross domestic product at market prices for major OECD economies
1970 1975 1980 1981 1982
United Kingdom 4.8 4.8 2.5 1.9 1.7
France 3.8 3.8 3.0 2.9
Germany 4.4 3.7 3.6 3.3
Japan 4.5 5.3 6.2 6.2
United States of America 2.5 2.3 1.8 1.6
* Central Government and local authorities.
Gross domestic fixed capital formation and increase in value of stocks.
Not available.

Source: National Accounts, Vol. II, OECD, 1964–81.

have been responsible for much of the sharp fall in GDFCF by local government in recent years, are separately available. They are shown as follows: