Government accused of undervaluing assets following Eurostar sale
The sale of the Government’s stake in Eurostar is ‘further evidence’ of assets being undervalued, say MPs.
The government sold its 40% stake early last year to Patina Rail, an investment consortium, for £585.1 million, almost double the price tag placed on the cross-Channel train operator by financial advisers.
A Public Accounts Committee report said this underlined a repeated tendancy to undervalue assets.
The sale of the Government’s entire stake has raised £757 million, although that was less than the estimated expenditure on the project of £3 billion, the PAC said.
The PAC also criticised a two-year delay by the Department for Transport in publishing an evaluation of Britain’s first high-speed rail line, HS1.
It said this has meant that important information that could have been used by Parliament to consider other projects, including the HS2 high speed line, was not available.
Leading the committee, Meg Hillier, said the Eurostar sale and the HS1 report ‘raise serious questions about the Government’s approach to valuing public assets, as well as its commitment to considering the value for money of public spending on such expensive projects’.
The committee concluded that the Treasury relied too much on ‘a small pool’ of financial advisers.
A Treasury spokeswoman said: "The Government welcomes the committee’s conclusion that the sale of our stake in Eurostar was well-handled and secured a good return for the taxpayer.
"Releasing public assets we no longer need is at the heart of our long-term plan to tackle Britain’s debts and boost economic growth, and that’s why we’ve recently identified up to £4.6bn of further asset sales, to help build on the huge progress we’ve already made."
Linsey McNeill
Editor Linsey McNeill has been writing about travel for more than three decades. Bylines include The Times, Telegraph, Observer, Guardian and Which? plus the South China Morning Post. She also shares insider tips on thetraveljournalist.co.uk
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