A slew of private finance initiative deals are likely to be rescued with state support in coming months. But if you were expecting the government to properly tell taxpayers about the extra risk they are taking on, think again.
Yesterday eagle-eyed Mark Pritchard, a Tory MP, was tipped off about a significant announcement in an “unnumbered command paper”. It announced that ministers had offered contractors bigger state-guarantees to save the largest PFI deal in Britain. But it was laid before the House in such a way as to be all but hidden. Can this be right?
The Ministry of Defence was responsible for the sneaky move. Officials need to present parliament with a “minute” in order to sign off a contingent liability of more than £250,000. In this case, the MoD offered to underwrite £32m in order to rescue the £12bn PFI project to centralise the military’s training.
Pritchard attacked the move as the MoD “once again” turning to the Treasury to “save face” and rescue a “deeply flawed project”. You can read more here.
Jim Pickard
Kiran Stacey