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Monday, 24 November 2014

Labour to raise £100m by selling state-owned assets

The Labour party will this week set out how it could raise an estimated £100m from the sale of bars, restaurants and conference centres currently owned by government departments. As part of a series of savings identified by Labour's Zero-Based Review of public spending, Chris Leslie, Shadow Chief Secretary to the Treasury, will outline how Labour will consider plans to realise the value of non-essential government buildings in prime property areas.

In the coming weeks Labour will publish a series of interim reports from its Zero-Based Review of public spending including on government assets, policing and local government. As part of the review, Chris Leslie has examined the property portfolio of Whitehall departments and has identified four buildings which it may no longer be necessary for the government to hold in public ownership.

Labour will commission value-for-money reviews of these buildings to consider whether it would be more appropriate for them to be sold and the proceeds used to pay down the national debt.

The buildings identified have an estimated value of over £100m:

  • - Inn The Park - a restaurant in St James' Park estimated to be worth £6.7m
  • - The Civil Service Club - a social club for civil servants - estimated to be worth £6.8m
  • - The QE2 Conference Centre - the largest dedicated conference venue in central London - estimated to be worth over £25m
  • - Marlborough House - currently used by the Commonwealth Secretariat free of charge - estimated to be worth almost £65m.
A final decision on any sale would be part of the final stage of Labour’s Zero-Based Review, which will be carried out in government, and would be subject to market conditions at the time. The proceeds of any asset disposal would be used to pay down the national debt which, under George Osborne, has risen by more than a third.

Chris Leslie MP, Labour’s Shadow Chief Secretary to the Treasury, said: "David Cameron's government is set to break its promise to balance the books and get the national debt falling. The next Labour government will get the deficit and debt down, but we will do so in a fairer way and by examining every pound of spending. It is time to consider whether it is necessary for the state to continue owning a restaurant in St James’ Park, a club for the exclusive use of civil servants, or a conference centre. Four such buildings in iconic locations in central London could attract interest from buyers around the world. A future Labour government will examine whether it would provide a better deal for taxpayers if the properties were sold off and the proceeds used to pay down Britain’s national debt.”

Labour’s Zero-Based Review (ZBR) of public spending is a root and branch review of every pound the government spends from the bottom up. The ZBR was launched by Ed Miliband and Ed Balls last year and interim reports will begin to be published later this week. The final phase of the ZBR will be completed in Labour’s first year in office. As part of the review Chris Leslie has carried out an analysis of every departmental budget and explored public service reform and redesign in detail with each shadow team.

This process has been guided by the following five principles:

  • We will use public money more efficiently – and seek efficiencies in every area of government spending
  • We will use all departmental budgets to strengthen the economy – supporting growth, job creation, innovation and exports
  • We will ensure greater fairness in the impact of spending – and will prioritise spending that prevents future problems
  • At the same time as increasing efficiency, the quality and experience of public service must improve – offering the speech, simplicity and responsiveness that people now expect
  • We will strengthen accountability and transparency across government – with clear efficiency incentives for all departments