Peter Hoskin

Filling the PFI gap

Filling the PFI gap
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Remember those PFI projects which were doomed to collapse because the banks are no longer willing to stump up the cash for them?  Well, an article in today's Times suggests that Alistair Darling is going to raid the public purse to ensure they're completed:

"A multibillion-pound rescue of building programmes involving schools, hospitals and motorways that are threatened by a lack of private finance is to be announced by the Treasury within days, the Times has learnt.

The Chancellor is expected to guarantee bridging finance to enable public sector schemes being built under the Private Finance Initiative (PFI) to go ahead if they are already in the pipeline."

Two things to look out for with this: a) whether the government spins it as entirely new "investment" à la FDR, and b) what this means for the off balance-sheet nature of most of these PFI projects.  Watch this space.