PM to sell public transport links in a bid to reduce the UK budget deficit?

Dartford Bridge

Prime Minister Gordon Brown has announced that he aims to raise over £16 billion, and reduce the country's budget deficit, by selling off public assets such as the Channel Tunnel rail link and the Dartford Crossing.

The plan will see a "portfolio of non-financial assets" sold off by the government over the next two years. It is hoped that the initial sales could raise as much as £3 billion and this would come from the sales of the student loan book, gambling firm Tote and the Dartford Crossing.

In a scheduled speech, the Prime Minister outlines his plans saying, "We need a deficit reduction plan that supports growth and jobs, not one that snuffs out recovery before it has started."

Brown's plan is to stem Britain's budget deficit, which is set to hit a record £220 billion, or 12 percent of the country's GDP. The sales are said to be key to Labour's "clear and credible" plans for halving the deficit over the next four years.

The sale of such assets has been roundly criticised by opposition MPs who have said the government has to do more then selling off a few assets to cut public spending. Liberal Democrat Treasury spokesman Vince Cable said the policy was fundamentally flawed saying, "What worries me about the government proposal is that they're proposing to sell off in very depressed markets, under very depressed markets for land and for shares."

The government may have already expected such a reaction, and there have been rumours that surplus real estate, which is part of the £220 billion owned by its departments and agencies, could also be sold off. Lord Mandelson has also been quoted as saying that local authority-owned airports could be sold off to raise funds.

However, there seems to be a flaw in the government's plan. With structures like the Dartford crossing, many have already paid for themselves several times over with years worth of tolls and fees. No doubt these tolls will be sold rather than the actual structures meaning the public will still have to pay for maintenance and upkeep, but will get no income from them.

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