Treasury publishes unaudited summary of first ever Whole of Government Accounts
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Issued on 13 July 2011 - Treasury
The Treasury has today published an
unaudited summary of the Whole of Government Accounts (WGA) for the
year 2009-10. The Government made available the key balance sheet
analysis contained in this summary to the Office for Budget
Responsibility (OBR) to enhance their analysis of the sustainability of
the public finances in their first ever Fiscal Sustainability Report,
also published today.
This is the first ever set of
publication of information for the whole of the public sector, covering
over 1,500 public bodies. It has been 10 years in the making, having
been delayed by five years. The full, audited accounts will be
published in the autumn and will be the most ambitious in scope
produced in any country.
The publication of this summary
represents a leap in the transparency of reporting the Government�s
future liabilities. It represents a snapshot of the Government�s
financial position on a commercial accounts basis. Its aim is to enable
Parliament and the public better to understand and scrutinise how
taxpayers� money is spent.
While the new information it presents
does not affect the fiscal position, the analysis it includes on, for
example, Private Finance Initiative (PFI )and public service
pension liabilities makes clear the scale of the fiscal challenge the
Government faced before the June 2010 Budget.
The Accounts show that the public
service pension liabilities as of 09/10 were �1.1 trillion pounds.
They also show that PFI capital
liabilities as of 09/10 were over �35 billion. The OBR�s assessment in
their Fiscal Sustainability Report is that these liabilities relate to
about 90 per cent of all operational PFI assets, which suggest the
total capital liability was closer to �40billion. The difference arises
due to the internationally recognised accountancy standards used in
WGA.
Welcoming the publication of the OBR�s
report and commenting on the publication of the WGA, the Chancellor of
the Exchequer, George Osborne, said:
�The information published
today by the Treasury and the OBR represents a step change in
transparency , lifting the lid on the liabilities built up in the past
and the pressures we face in the future. They show that our deficit and
reform plans are not just right for the economy now, but also right for
the economy and fair for the country in the future.�
Notes
1. The unaudited summary of the Whole of Government Accounts for
2009-10 is available on the WGA
section of the Treasury website.
2. The full, audited
accounts will be published later this year.
3. The Government
announced the creation of an independent Office for Budget
Responsibility in 2010 to provide independent and authoritative
analysis of the UK�s public finances.
As part of this
role, the Budget Responsibility and National Audit Act 2011 requires
the OBR to produce �an analysis of the sustainability of the public
finances� once a year. The OBR�s first Fiscal Sustainability Report has
been published today and is available on the
OBR�s website (external website, opens ina new window).
Background
to the WGA
4. Parliament originally requested consolidated accounts for
central government as long ago as the 1994-95 parliamentary session. In
July 1997, the Treasury agreed to look at the feasibility of such
accounts.
The resulting
1998 scoping study concluded that producing consolidated accounts for
the whole public sector was the best way to proceed and that this would
bring benefits for both government and external users.
5. The commitment
to produce WGA was initially made in the Code for Fiscal Stability ,
following this report. This commitment became a statutory
requirement through the Government Resources and Accounts Act 2000
(GRAA), which created the requirement for Treasury to annually prepare
WGA .
Whilst the GRAA
created an obligation for Treasury to prepare WGA, it left the
timetable for publication to be set at a later
date.
6. The initial
aim was to produce an audited account covering the central government
sector for the 2005-06 year. This was delayed until 2007-08
when the scope of the account was extended to include local government,
NHS and public corporations.
Publication was
then further delayed when it was agreed that central government
departments would move to IFRS. In the 2008 Budget, the then Chancellor
announced that WGA would be published for 2009-10, in line with the
move to IFRS in the central government sector.
About the Author
� Crown Copyright. Material taken from HM-Treasury.
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Article Published/Sorted/Amended on Scopulus 2011-07-18 19:20:41 in Economic Articles
