The National Audit Office (NAO) has criticised the government for not having a central system in place to manage its £222 billion worth of financial assets.

The government controls 54 financial institutions, but plans to raise £62.6bn by privatising assets like the Royal Bank of Scotland, Lloyds Banking Group and some student loans.

But the NAO says its investments are "out of control", with a number of organisations set up to deal with problems that no longer exist. The body said that failure to manage those institutions effectively would have resulted in their closure long ago.

“It is unclear that any single area of government is taking a portfolio view of these institutions,” the NAO said, adding that such an approach could help the Government manage risks to the taxpayer.

“A portfolio approach offers the advantage of providing oversight, beyond departmental boundaries, of identifying and managing potential exposure to risk and the ability to benchmark performance across institutions and within sectors,” it said.

Auditor general Amyas Morse said: “Some of these institutions appear to have survived the market conditions they were created to alleviate after the financial crisis, and the rationale for their existence in the public sector is questionable.

“The Government’s plan to accelerate its asset sale programme is unprecedented in scale and aims to reduce its exposure to the financial sector. We expect the Government to demonstrate good practice when it disposes of these investments.”

The Treasury stressed that it is getting to grips with the issue.

A spokesperson said: “We are determined to get the best value for taxpayers from the assets the Government owns and manages on their behalf, and to reduce the level of public debt.

“That is why the Government is merging UK Financial Investments and the Shareholder Executive into one organisation, to return Government investments back to the private sector."