Local Authority Capital Receipts

HC Deb 07 July 1994 vol 246 c268W

Mr. Wareing

To ask the Chancellor of the Exchequer what percentage of the public sector borrowing requirement is accounted for from the capital receipts held by local authorities.

Mr. Portillo

When a capital asset is sold by a local authority it generates a capital receipt which reduces net capital expenditure and hence general government expenditure. This, in turn, reduces the public sector borrowing requirement. When the proceeds from the sale of a capital asset are spent, net capital expenditure increases which increases general Government expenditure and hence the public sector borrowing requirement.

The table sets out the latest data for local authority capital receipts and the public sector borrowing requirement.

	1991–92 £ billion	1992–93 £ billion	1993–94 £ billion
Local authority capital receipts	2.8	2.6	3.9
Public sector borrowing requirement	13.9	36.6	46.0