Holdings: Osborne confirms public asset sale plans
Plans to sell off a string of publicly owned assets to help plug the hole in Britain's finances have been confirmed.
The Government will also look at disposing of its shareholding in Nats, the air traffic control service, the Chancellor said. Sale of the student loan book and the Tote will also be considered.
And once the departmental Spending Review round is concluded in October, the Government will also look at the future capacity of the Dartford Crossing and the possibilities of letting out a concession, George Osborne said.
Some moves to sell off public assets have already been made. The High Speed 1 rail link from London St Pancras to the Channel Tunnel was put up for sale at the start of this week, with a price tag in excess of £1.5bn. And the Government announced its intention to look for an injection of private capital into the Royal Mail Group within weeks of taking office – an aim which was confirmed in the Budget.
But the plan is not a Conservative or Liberal Democrat brainchild. The future of the Tote has been in the balance since as early as 2001 – when a sell-off was a Labour Party manifesto pledge – although repeated attempts to find a buyer have come to nothing.
The Labour government also included plans to raise £16bn from privatisation in the March 2009 Budget. The sales of the student loan book and the Tote were swiftly pulled, blaming market conditions.
But in October, the then Prime Minister, Gordon Brown, set out a detailed list including the Channel Tunnel rail link, the Dartford Crossing and the Government's 32 per cent stake in the uranium processor Urenco, as well as a swath of local government real estate.
Despite the Budget commitments to resolve outstanding issues, the Government's plans were greeted with a degree of scepticism yesterday.
"The extent to which the asset sale plans have progressed is disappointing," Dr Ashley Steel, the global chairman for infrastructure and transport at KPMG, said.
"Whilst confirmation of the planned sale of a number of the Government's assets is as expected, the Government has yet to present the specific details or a timetable for achieving these sales."
Not only do the plans offer no details on how the round of divestments will be achieved, they also do not go far enough to meet the enormous challenge facing the public finances.
"Further productivity and efficiency gains in the public sector will require further divestments beyond those announced," Dr Steel said.
"This will include the need to bundle up existing government services such as drivers' licence and passport issue."