A report in the Financial Times, that hotbed of socialism, says that PFI’s as PPP’s are known in Britain cost an extra 20 billion pounds in “extra borrowing costs” over the 53 billion pounds of the projects’ actual cost. Not only that, 4 billion pounds will go to consultants.
The extra interest being paid on PFI contracts over the cost if the government itself had borrowed the money for conventional procurement was “a shocking amount of money”, said Richard Bacon, a Conservative member of the public accounts committee, parliament’s spending watchdog. “It is clear that PFI has spawned an entire industry of advisers who have done extremely well out of it. Fifteen years ago, you never heard someone say: ‘I am a PFI consultant, or PFI lawyer.’ Now they are almost two-a-penny.”
Enough said. Another dumb idea from those who gave us collateralised debt instruments, self-correcting markets and “there is no alternative”.