Join our community of smart investors

Spending review: Selling the family silver

SPENDING REVIEW: Asset sales are firmly on the agenda as the government looks to cut the deficit.
October 20, 2010

Asset sales remain firmly on the government's agenda and the spending review made it clear that disposals are expected to fund some initiatives, such as the Green Investment Bank.

Given the historic tendency for state assets to be "priced to go", there could be some tasty morsels here. Whitehall's property assets could be hived off into real estate investment trusts (Reits) and other assets, such as National Air Traffic Control, could yet be floated on the stock market.

Listed players are among the likely bidders for a host of assets that are expected to be put on the block - including the Tote, the student loans book, the Royal Mint and its stake in the Channel Tunnel Rail Link, to name but a few.

Property looks like it could prove a very fruitful area for disposals and savings given thta Sir Philip Green's efficiency review, which specifically criticised the lack of any centralised property management, received warm praise from the Chancellor. The newly created Government Property Unit is expected to employ private expertise to help find savings.

The Office of National Statistics estimates state properties are worth £320bn, although, others think the sprawling estate is worth closer to £500bn.