MercoPress. South Atlantic News Agency

British government to sell assets to help balance public finances

The first package of £16 billion is to be announced this week by PM Brown

The British Government is to sell off £16 billion of assets as part of moves to restore stability to the public finances, Prime Minister Gordon Brown is to announce. Details of an initial round of sales that could raise £3 billion - including the Tote, the Dartford crossing, the Channel Tunnel rail link, and the Student Loan book.

The announcement will come in a speech where Mr Brown is to set out an alternative to the immediate spending cuts proposed by the Tories. He will say that premature curbs risk “snuffing out” the economic recovery before it has even got properly under way.

“We need a deficit reduction plan that supports growth and jobs not one that snuffs out recovery before it has started,” the premier is to say.

Outlining his plans to sell a “portfolio of non-financial assets” held by Whitehall and local authorities for some £16bn, Mr Brown will indicate that he wants government to focus on “what it does best”. The funds raised over the next two years will help finance new capital investment and pay down debt, according to the PM.

The government will also dispose of surplus real estate as market conditions improve.

Aides said the sell-off marked the beginning of a “radical programme” to identify “non-core government business activities” that should be done in, or in partnership with, the private sector.

Mr Brown will say that such action is crucial to Labour's “clear and credible” plans for halving the deficit over the next four years. In a clear dig at the Tories, who have called for cuts to start immediately, the premier is to declare that spending should continue at the intended levels for the next year.