Besides the capacity to innovate and harness technology, UBS said, productivity growth tends to go hand in hand with strong national balance sheets — a country's current account balance, its public sector balance sheet and its level of private credit.
The attraction was a financial con: PFI contracts take borrowing off the Government's public sector balance sheet.
However, worried about the public sector balance sheet, the government has capped the amount they can borrow.
The public sector balance sheet is the only one in the economy large enough to cope with this.
That, in turn, will shrink the size of the private sector balance sheet that consumers and companies have come to rely upon.
Asset sales do not, by themselves, improve the public sector balance sheet – public debt is reduced but so are assets, leaving net debt unchanged.
If the bank bailouts, which added some liabilities to the public sector balance sheet, are excluded, however, the national debt is closer to a more respectable 50% of GDP.
Javid insisted the move was necessitated by the government's desire to move the bank off the public sector balance sheet so it could borrow without affecting the UK's government deficit.
Subsequent chancellors, especially Labour's Gordon Brown, were "enthusiastically in favour of it", Lawson continued, because it enabled ministers in the short term to "dress up" considerable amounts of public expenditure off the public sector balance sheet.
They facilitated major private sector balance sheet repair, starting with banks and then corporations and households.
