London: The British government will sell off the undersea Channel rail link, a bridge, and a betting company, among other assets, to raise £3 billion ($4.8 billion) to help it manage its swelling debt, the Prime Minister will announce Monday.
Gordon Brown’s office, which had released details of the plan on Sunday, said the premier will make the announcement in a speech.
Business secretary Peter Mandelson told Sky News on Monday the sell-off would “help us reduce the deficit without cutting into vital public services”.
Nonfinancial assets to be sold over the next two years include the Channel Tunnel rail link, the Dartford bridge and tunnel crossing the River Thames, betting company the Tote, and the government’s 33% stake in European uranium consortium Urenco.
Brown also plans to say that local governments will sell off another £13 billion ($21 billion) in assets such as business parks and leisure centers. The money will help finance capital investment and pay down debt, his office said.
An earlier government attempt to sell off the Tote betting chain was abandoned after it failed to attract a high enough price. Government critics say that in the middle of a recession, the latest sell-off amounts to a “fire sale” of government assets.
“Attempts to sell off large amounts of government land into a very depressed market such as we have now would be frankly barmy,” said Liberal Democrat economy spokesman Vince Cable.
But Mandelson told the BBC that “the market is looking up”.
“Of course we’re not going to sell at the bottom of the market ... we’re not idiots,” he said.
Britain is suffering its worst recession in decades and the budget deficit, the gap between spending and revenues, is widening. But Brown has recently sounded cautiously optimistic about the economy.
In an interview published Saturday, he said the economy would grow by 1.5% next year, more than many economists have foreseen.
Monday’s speech is part of a bid to counter arguments by the opposition Conservatives that only deep public spending cuts can slash the debt and turn around the economy.
The Conservatives propose raising the state pension age, tightening welfare programmes and freezing the pay of hundreds of thousands of public sector workers.
Brown plans to say that slashing public spending would “cut the legs off from under the recovery and lead to higher deficits and debts down the line”.
The economy looks certain to be the dominant issue in a national election that must be held by the middle of 2010. Opinion polls give Cameron’s Tories a substantial lead over Brown’s Labour Party, which has been in power since 1997.
Downing Street said Brown would call on Monday for “unconventional thinking ... to avert a Japanese-style lost decade of low growth and jobless recovery”.