Network Rail

Treasury written question – answered on 8th January 2014.

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Photo of Mary Creagh Mary Creagh Shadow Secretary of State for Transport

To ask the Chancellor of the Exchequer

(1) following the reclassification of Network Rail, whether official borrowing and debt figures will continue to exclude Network Rail debt;

(2) what assessment he has made of the effect on the Government's deficit of reclassification of Network Rail's debt.

Photo of Danny Alexander Danny Alexander The Chief Secretary to the Treasury

holding answers 6 January 2014

As set out in the autumn statement, the Government welcome this review by the ONS and have always been committed to a transparent reporting of public liabilities. It will therefore implement the ONS's decision in reporting arrangements, in line with this Government's commitment to transparency. The reclassification of Network Rail to the public sector is a statistical decision. It does not change the industry structure or affect the day-to-day operations of the rail network.

The OBR highlighted the potential impact of a public sector reclassification in Box 4.2 of its December 2013 “Economic and fiscal outlook”. This was reiterated in paragraph 1.80 of the autumn statement 2013. The independent OBR will in due course estimate the impacts of this decision on the public finances and on the mandate.

The Government inherited the biggest deficit in the developed world from the previous Government. Thanks to difficult decisions the deficit is down by a third. The Government will continue to reduce the deficit by taking difficult decisions to cut public spending and prioritise investment in infrastructure to deliver a stronger economy and fairer society.

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