The government’s pension scheme liability rocketed by a whopping £448m last year, latest government accounts show.

But much of the increase - £324m - was a paper loss due to changes in financial assumption.

Details are given in the government accounts for 2018-19 that were laid before last week’s Tynwald sitting.

The accounts provide some good news for government with income up and above budget forecast.

Gross income was £1,163.4m, up from £1,102.1m in 2017-18, partly due to increased income tax receipts of £24.8m and an extra £24.7m in Customs and Revenue revenue.

But the figures for the pension scheme liability are eye-watering.

This liability increased by £448m during the year to £4,171m, principally due to an actuarial loss of £324m.

In 2017-18, the liability actually fell by £100m to £3,723m, when there had been an actuarial gain of £223m.

The accounts note: ’The actuarial loss is the result of changes in financial assumptions primarily due to a decrease in the real discount rate resulting from reduced corporate bond yields together with a slight increase in expected future CPI [consumer prices index] inflation.’

While operating income was up last year, so too was operating expenditure from £1,117m to £1,189m.

Of that £72.1 million increase, department spending made up about £21m and the remainder was due to a rise in the cost of servicing pensions and depreciation for fixed assets.

Department expenditure now includes a contribution for employee pension costs.

Gross expenditure was £1,280.7m compared with £1,282.8m in 2017-18.

The deficit was £117.1m due to the £100m interest cost on the pension scheme, offset against a £32m unrealised gain on investments, notes the accounts.

Total capital expenditure for the year was £60.8m, compared with the original budget of £120m.

Capital expenditure was up on 2017-18 due to the number of large projects being undertaken including the NSC at £2.4m, Douglas promenade at £1.6m, Liverpool landing stage at £1.6m, St Mary’s School at £2.5m and £2.2m on public transport.

The balance on the capital fund at the end of the year was £813.4, with £62.8m in cash remaining available for capital expenditure. There was no requirement to transfer money from the reserve fund to balance the revenue position but there were transfers totalling £32m to the other funds.

The decision to take the Steam Packet into state ownership may have also paid dividends, according to the accounts.

The combined operational surplus for the statutory boards, which includes Manx Utilities, the Post Office and Radio Manx Ltd, was £28.2 m, up from £7.3m.

’The increase in the surplus is primarily due to the acquisition of the Steam Packet Group,’ notes the accounts.