In These New Times

A new paradigm for a post-imperial world

Labour’s PFI debt will cost five times as much, Conservatives claim

Posted by seumasach on December 28, 2010

These are some of the hidden debts which make Britain the world’s leading economic basket case, its AAA rating notwithstanding. Here we have a cool £15,000 per head for a lot of tenth rate new schools and hospitals some of which are unlikely to be still standing while the debt is still being paid off.

Telegraph

27th December, 2010

The schemes were a pet project of Gordon Brown as chancellor and involved companies taking on the upfront capital costs of paying for public building schemes such as hospitals or motorways in return for receiving substantial rates of return over long periods of time.

New analysis issued by the Tories shows that the 544 PFI projects agreed under Labour will cost every working family in the country an average of nearly £15,000 each, even though the original building cost stands at just over £3,000.

On average, the gap between the total repayment and the actual cost of the building is the equivalent of £11,700, four times the original pricetag.

Jesse Norman, Conservative MP for Hereford and South Herefordshire, is leading a campaign to encourage banks, construction firms and service companies which have benefited from PFI in the last 10 years to give back a small proportion of their profits.

He accused Ed Miliband, the Labour leader who worked for Mr Brown during his decade at the Treasury, of sharing responsibility for the debacle.

 

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