§ Mr. Blairasked the Chancellor of the Exchequer if he will publish in the Official Report references in support of the statement that proceeds from privatisation are, in line with international conventions, netted off against the public spending figures, Cmnd. 9702–1, paragraph 57, and place the relevant documentation in the Library.
§ Mr. MacGregorThe United Kingdom treatment of privatisation proceeds is in accordance with the advice in "A Manual on Government Finance Statistics" drafted in 1974 by the IMF, and in general use since. Section IV C of the manual makes it clear that transactions in company securities should be treated, like net lending, as part of net Government expenditure rather than as a financing item. The net treatment is also supported, for example, by the "European System of Integrated Economic Accounts" published by the Statistical Office of the European Communities. I am placing copies of relevant extracts of the documents referred to above in the Library.
Public expenditure expressed as a percentage of GDP 1978–79 outturn 1979–80 outturn 1980–81 outturn 1981–82 outturn 1982–83 outturn Cmnd 9428 definition 40½ 40 42½ 43½ 43 Cmnd 9702 definition 43 43½ 46 46½ 46½
1983–84 outturn 1984–85 outturn 1985–86 estimated outturn 1986–87 plans 1987–88 plans 1988–89 plans Cmnd 9428 definition 42½ 43 41 40 39 38½ Cmnd 9702 definition 46 45½ 44½ 43 41½ 41 An explanation of the above two definitions was given in an article entitled "Measuring Public Expenditure" published in the August 1985 edition of Economic Trends, table D of which provides a reconciliation between the two measures. This article includes figures going back to 1973–74. It should be noted that these figures are not directly comparable to those given above because they were based on the definition of the planning total used in the 1985 White Paper. However, the differences between the two White Papers are relatively small.