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PFI accounting change another fiscal blow

According the Financial Times this morning, the adoption of international financial reporting standards (IFRS) in the public accounts from this April could lead to the inclusion of the Government’s liabilities relating to the Private Finance Initiative (PFI) in the published level of public sector debt. We have drawn attention to these liabilities – which have until now been left off the government’s balance sheet – on a number of occasions. (See UK Economics Focus, “The Government’s hidden £40bn debt” 27th Feb. 2003 and, “Is there a hidden fiscal crisis?” 10th March 2005.)

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