You asked

What is the estimated value of all the financial liabilities being built up for government, (in a time series) for example nuclear decommissioning, NHS medical liabilities and/or issues regarding Network Rail etc?

We said

Thank you for your request.

The widest measure of public sector’s financial liability we publish is the public sector net financial liabilities (PSNFL). PSNFL is available in the monthly Public sector finances bulletin.

PSNFL includes the liabilities of the government sector and public units operating on a market basis such as Scottish Water but excludes liabilities of public sector banks such as the Royal Bank of Scotland. It should be noted that although there are over 3,000 legal entities in the public sector that could be broadly described as companies for statistical purposes, most entities are classified to the general government sector in reflection of their economic substance.

The headline measure is calculated on a net basis which means that financial assets held by public sector organisations are subtracted from the gross value of public sector financial liabilities. The estimate of gross liabilities is also available and is published in the table entitled “PSNFL1”, which can be found in Appendix A of the bulletin.

PSNFL is produced in accordance with the national accounts framework and includes all non-contingent financial liabilities such as debt securities, loans and liabilities relating to funded pension schemes. However, national accounts differ from commercial accounting in that contingent liabilities and other potential obligations are not recognised as liabilities and are not included in the statistical aggregates.

Contingent liabilities are possible obligations that only arise when specific conditions prevail in the future. As such, there is uncertainty over whether a payment will be required or not, and its potential size. Provisions for nuclear decommissioning and clinical negligence are examples of obligations that are not included in the UK National Accounts. We presently publish supplementary information on contingent liabilities in our article entitled “Wider Measures of Public Sector Debt”.

As well as our statistics, the Whole of Government Accounts (WGA) produced by HM Treasury provides information on government and public sector liabilities, consolidated at the public sector level. The WGA is compiled in accordance with the International Financial Reporting Standards and therefore includes contingent liabilities such as nuclear decommissioning and clinical negligence. The estimates are also available on a net and gross basis.

Estimates of public sector liabilities on a net and gross bases as measured by PSNFL and the WGA are available in the attached spreadsheet.