USE OF PUBLIC CREDIT FOR PUBLIC WORKS

That this House is concerned by the conclusion of the report by the Association of Chartered Certified Accountants (ACCA) that private finance initiative is an expensive way of financing and delivering public services; urges the Treasury to commission an independent review of the benefits of using public credit and increasing the proportion of publicly created money as alternative means of financing public works; notes that the case for using public credit in this way is strengthened by the fact that, as measured by the proportion of publicly created money in circulation, public credit fell from 20 per cent. of the money supply in 1964 to 3 per cent. today; suggests, therefore, that an increase in the proportion of publicly created money should be used to cut the costs of public investment and to boost the total amount of public spending without borrowing or taxation; considers that this can be done without any impact on inflation; and therefore urges the Chancellor to develop and use public credit rather than accumulating even more debt or enriching the private finance initiative and public private partnership contractors who are making vast profits from the Government's desire to provide alternatives to borrowing, even though this one is more expensive in the end.