PFI - Labour's criminal legacy

Once in a while you read a story about a "Walter Mitty" figure who runs up huge debts in order to fund a lavish lifestyle and impress women. The story ends with the man going to jail, leaving a string of angry creditors and disillusioned women in his wake.

Such is the nature of the Private Finance Initiative a scheme whereby public building schemes were contracted out to private industry in such a way that the companies who signed up were given cast iron guarantees of profit. It was a licence to print money. PFI companies are making massive profits out of the scheme and are understanably shy about discussing them, but a recent FOI request has the truth laid bare:

British taxpayers are committed to pay £229 billion for new hospitals, schools and other projects with a capital value of just £56 billion (Telegraph)

You probably have examples of where PFI has produced a local scandal. One such example in my area involved a school. The contractors went bust having taken the money and run, leaving a building site that stood empty for over a year. They were lucky, at least they will not have to pay for buildings long after they have fallen down.

So what was behind this confidence trick? Why did Andy Burnham sign off 221 PFI schemes? Labour was desperate. They had spent so much of our money that they were unable to raise anymore. More than that, they had a plan to mask this spending by leaving it of the crucial list of public debt. In effect they simply did not admit they were committing this funding for all PFI negotiations were kept from public view. Until now.

I suppose it is pointless to ask that this gutless government calls Burnham, Balls and Brown, the architects of this travesty to account and also that a bill be introduced in Parliament to abolish these contracts. Oh no, that would upset too many important people.


Brian said...

The FSTA PFI meanns the RAF rents the availability of 14 Airbus 330 tanker transports for 24 years at a cost of £10.5 billion. Fourteen Airbus 330 aircraft could be bought brand new off the production line and converted for £2.6 billion. The RAF would then have £7.9 billion to maintain and operate them over 24 years and still own something to trade in. Yet people moan when only £3.8 billion is wasted on scrapping Nimrod MRA4.
What is the difference between PFI and this?

Twig said...

Makes you wonder why the Tories are reluctant to expose this scam, doesn't it?