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UK's £131bn PFI bill 'four times the value of assets'

PFI had left the UK with £131 billion of future debt by 2009/10 – four times the value of the assets secured through the deals

The House of Commons public accounts committee, tasked with scrutinising government spending, revealed the number in a report on the whole of government accounts for the 2009/10 financial year.

The report out yesterday (7 February), and seen by AJ’s sister publication Construction News, follows the group’s scathing analysis of PFI in September last year.

A call for evidence into PFI – which sees schools, hospitals and roads financed, designed, built and maintained by private consortia and leased back by the public sector over 25-30 years - closes on Friday.

Former architecture minister Margaret Hodge, in her role as chair of the public accounts committee, said: ‘The 2009-10 Whole of Government Accounts (WGA) reveals some staggering numbers and shows that the total effect of individual financial decisions can be very significant.’

Hodge added:  ‘The accumulated value of future commitments under PFI schemes was £131.5 billion – four times the value of the assets secured through the deals.

‘The provision for nuclear decommissioning was £56.7 billion and increasing.

‘The committee said this is the first time either Treasury officials, or ministers, or MPs and the public have been able to look at the total cost of policies over time.

‘The challenge is to improve the accuracy and extend the coverage so that there is proper transparency over the government’s spending commitments over time – not just in the Spending Review period.’

In August last year, the Treasury Select Committee issued a report saying the government should bring £35bn of PFI debt onto its balance sheet. That committee warned last month against creating new forms of private financing “by the back door”.

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