In David Miliband’s “leaving do” speech for Gordon Brown, one line jumped out at me – when he said Gordon Brown has “transformed the debate about international development in Britain”.
He has certainly transformed the accounting, by pioneering dodgy off-balance sheet financing of overseas aid. It’s worth revisiting, in the light of his new pious anger about banks who use off-balance sheet financing. His so-called International Finance Facility is a classic Brownite vehicle: it exploits a Eurostat loophole so if three or more EU countries share a pool of debt, it doesn’t show up on any of their books and they can fool their taxpayers into thinking they owe less than they do. It could only go ahead when Eurostat agreed on Brown’s definition of their rules.
Brown wanted to do this for a £50 billion loan, but couldn’t get anyone else to join in his scam. Germany and the USA refused, saying the accounting principles behind it were dishonest.
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