Brown hints at big assets sale plan to ease the pain of cuts – but why not spell it out?

Remember how the real story of Gordon Brown’s budgets was often buried in the Red Book? So, amazingly,the real story of Labour’s manifesto day may be written in an obscure newspaper article by the chairman of an insurance company. Labour’s manifesto launch in a brand new Birmingham hospital was cheesy and flat, an uneasy mix of Labour rally and news conference. The political editors were booed by the faithful – not a good start. Sky’s Adam Boulton made the unwelcome point that the hospital was costing £600m to build and equip but will cost the taxpayer £2.5bn under PFI. After blustering hsi way through that, Brown gave us two significant soundbites:

Our plans are costed no the basis of not raising VAT. The Conservative plans cannot be understood without raising VAT
Every single penny that has gone to help the banks will be returned to the people of this country.

It was responsible to put so little in the goody bag and even good politics. Just a rise of the national minimum wage, ” a living wage” guarantee for the lowest paid public sector workers and a toddler’s tax break. But it was the BBC’s Nick Robinson who raised “ the elephant in the room” – the complete absence of a word about cuts, what services would have to be withdrawn.. It took a prompt from C4 News’s Gary Gibbon to drag out of Brown what is the half hidden story of the day that may balloon into something big – that Brown wants to pay back a lot of the debt by selling off as much as possible of the state property assets and make “realistic” public efficiencies over the next few years. The way he chose to break this must be uniquely awkward for election campaign . He referred us to a recent article in the Financial Times by Gerry Grimstone the chairman of Standard Life and a Treasury adviser. If Brown wants to suggest that efficiencies and asset sales can limit the impact of cuts on services, why be so coy about it?
From Gerry Grimstone’s article

I am pleased that the programme’s recommendations were accepted in full and are being used to help deliver a planned extra £15bn of efficiency savings in 2010-2011

We could perhaps save about £4bn per year through various structural reforms. It will not be easy or quick. One of our plans is to create public service companies, which we believe will provide the biggest improvement in efficiency. This cannot happen overnight. If it could it would, of course, have been done already.

Ambitious plans have also been drawn up as to how to manage property in the public sector and to make sure that the government does not own any more than it needs.

The value of the UK public sector estate is about £370bn – equivalent to £6,000 of property assets for every UK resident. I have always believed we should put that estate to work for the public benefit. We have already set in train plans to use a variety of corporate vehicles to unleash these savings. But unless we are in the business of giving taxpayers’ money away, we must wait until the property market is right, and for leases to come up for renewal, in order to deliver savings without this actually wasting public money

Does Labour think they can get away without serious front line cuts? It’s the impression Brown seemed to want to leave us with. We’ll see how it stands up during the campaign.

  • Our local politicians could take the hint. Water, transport, central statistics, the de-commissioning of Commissions. Wouldn’t take long to cut the public sector and give the business community a break and open up the economy more.

  • Cynic2

    Can we sell Derry to the Republic?

  • Greenflag

    ‘Can we sell Derry to the Republic?’

    Don’t be such a miser . Why not include Fermanagh and Tyrone and most of Armagh and South Down and West Belfast and parts of North and South belfast and the Glens of Antrim . I’m sure Brian Cowan could scrape up the euros to take that lot off UCUNFER hands πŸ˜‰ assuming Messrs Brown or Cameron can’t find any other family silver to sell off ?

    Shure you could have your own little piece of Finchley North West to return your 8 or 9 true blue Tories to Westminster at every election from now to eternity πŸ˜‰

    Would’nt it be loverly ? No more nasty taigs messing up the afternoon teas and cucumber sandwiches ;)?

  • Michaelhenry

    derry is part of ireland cynic2 the vast majority of irish people voted yes for the good friday agreement, why do they not sell of the house of lords and get rid of all those un elected toffs inside, all the money that is needed would be raised with out hurting the people.

  • Brian Walker

    As a Derryman myself the digression is tempting but irrelevant..

  • Selling assets?

    And why not? Some calculations suggest the “valuation” of the “nationalised” banks and their off-shoots is already at or even well above “parity” (that is compared to the “cost” at acquisition).

    Don’t expect to hear much about that, this side of a new government being formed, from any political party: they’re all terrified it would provoke the likes of the UK Shareholders’ Association.

  • Driftwood

    Its Grim up North according to most Southerners.

    read it and weep Gerry