PFI repayments top £1 billion for the first time

Payments related to Private Finance Initiative (PFI) projects in Scotland have topped £1 billion for the first time, according to new Scottish Government figures.

Unitary charge payments related to PFI projects rose to £1.009 billion in 2016/17, up from £995 million in the previous year, and are still rising.

PFI was the preferred form of Public Private Partnership (PPP) in Scotland until 2007, when the SNP-led government replaced it with the Non-Profit Distributing (NPD) model.

Payments for both PFI and NPD projects take the form of a unitary charge which is usually paid annually over the lifetime of the contract.

SNP MSP Ash Denham, who sits on the Scottish Parliament’s finance committee, said the scale of PFI repayments “are now absolutely staggering”.

She said: “Deals like the PFI contracts for schools across Scotland, recently revealed as costing the public purse £426 million this year alone, will leave taxpayers paying way over the odds for years to come – and many of the buildings weren’t even built to basic standards, causing serious safety concerns and school closures across Edinburgh.

“Labour and Lib Dem enthusiasm for ruinously expensive PFI deals is still costing the public purse eyewatering sums of money - money that could have been spent on improving important public services is instead being diverted to pay off their enormous debts.”

Unitary charge payments related to NPD projects also reached a new high of £117 million in 2016/17, up from £73 million in the previous year and more than double the £52 million in 2012/13.