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PUBLIC SECTOR FACES 'BANKRUPTCY' BY NEXT YEAR

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According to a report by Coopers & Lybrand accountants, excessive borrowing combined with low public investment and...
According to a report by Coopers & Lybrand accountants, excessive borrowing combined with low public investment and a rundown in state assets will leave the public sector technically bankrupt by the end of next year, reports the Financial Times (p8).

The report blames government policy of borrowing to finance current spending rather than to invest in the country's asset base.

The combined net worth of central and local government - the difference between its assets and liabilities - has fallen from £243bn at the end of 1989 to £36bn by the end of 1995.
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