I wondered what it was, now it’s clear, it’s another way of ‘selling off’ services.
That’s not quite true – it’s another form of central and local authority outsourcing.
PFI’s been around for quite some time. While Brown gets a hammering, because so much infrastructure work has gone off balance sheet (and provided profits to private sector contractors), its origins go way back into the previous Conservative governments of the 80s and 90s.
It’s by no means an ideal solution (I disagree strongly that any publi “services” should be available for private sector profit), it does mean that lots of works that would otherwise have joined a very large queue for public sector capital have now been built. most notably schools and hospitals infrasrtructure.
Sadly, though, the model requires private sector financing (“private” finance initiative), and since there’s a dearth of bank lending right now, it means that large PFI projects near to financial close are now hanging in the balance – the Treasury has offered some cash to certain projects, as the cost of losing them would be greater than the cost of finan cing them in the short term….