The Treasury replies…

On Monday morning, I put my questions about the Autumn Statement to the Treasury. I’d spotted an omission of £1.7billion: the downwards revision to estimated graduate repayments as a result of selling a portion of the loan book.

Yesterday evening, I finally received a reply:

“Consistent with the OBR’s approach and for reasons of commercial sensitivity, table 2.5 in the Autumn Statement did not specify a figure for lower repayments, however these figures are fully consolidated into the calculation of Public Sector Net Debt. The Government has always been clear that selling the student loan book would obviously reduce the income received from repayments. Even when the OBR’s estimate of lower repayments are included, the sale of loans more than finances the cost of new, additional loans over the scorecard period.”

It took them two days to concoct that.

I particularly like the ‘obviously’ and that the change to graduate repayments is somehow ‘commercially sensitive’, but the ‘gross proceeds’ from the sale programme are not. Let’s hope no one else reads the OBR’s Economic and Fiscal Report!

The IFS called the proposal to fund more loans through the sale of loans ‘economic nonsense’.

I think it’s worse than that – back of the envelope calculations missed basic facts about financial assets. Watch this space.

Update

I can’t resist pointing out the ‘kettle logic’ in the quote: ‘these figures are fully consolidated into the calculation of Public Sector Net Debt. … Even when the OBR’s estimate of lower repayments are included …

Table 2.5 of the Autumn Statement needs urgent revision.