The true cost of PFI

I've never been a fan of PFI schemes. They are simply a ruse to allow the government to pass debt off to agencies, councils and other public bodies, at an inflated rate, so that the government does not look like it is getting in to debt.

For example. a few years ago the government paid of several billion pounds of the national debt with money received from 3G phone licenses. However, in the same year NHS trusts, and other public bodies borrowed money in the form of PFI schemes. So what is wrong with that ? The difference is that the national debt was on a very low interest rate, but the PFI is at a higher rate. In lay mans terms the government borrows on one credit at a higher rate in order to repay another credit car which is on a lower rate.

Today it has been highlighted just how much some PFI contractors screw out of the organisations they are working for. For example,

"The report by the NAO - the official Whitehall spending watchdog - found that a lock could cost anything from £15.09 to £486.54, while the cost of a key ranged from £4.26 to £47.48."

Yes, you read that right, a PFI contractor was charging £47.48 for a key. Presumably a gold one which opens the pot of treasure they have screwed out of the hardworking taxpayers of this country ?

In some local authorities now they are making much of the wonderful school building programmes which is ongoing. Sadly these councils fail to mention in any press releases how much money will be taken from school budgets to pay for the PFI. Someone told me it could be up to 12%of the school's budget. For some new schools it even means moving from a large school building to a new smaller school building, and then losing 12% of their budget. Yes, it does seem crazy.

I am sure there will be those who argue that without PFI none of these schemes would go ahead. But in truth, the PFI schemes are just a way of the government trying to hide the level of debt the country is in. We go on about the £1 trillion of personal debt the people of the UK are in, but I wonder if we added up the debt of the public sector trough PFI schemes what it would come to.

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