PFI schemes under fire
The Norfolk and Norwich University Hospital was a PFI initiative
This time the member of the Public Accounts Committee has Private Finance Initiatives in his sights.
He's complained that the schemes, used widely under Labour but the brainchild of the Conservatives originally, aren't value for money.
"PFI has been used to build new hospitals and social housing, but many early PFI housing projects have suffered long delays and the cost of providing hospital services varies widely.
"There is no clear evidence that PFI has provided taxpayers with better value for money than alternative means of funding but many local authorities and NHS Trusts were not offered any realistic alternatives to the use of the Private Finance Initiative.
"Government departments must not chain public bodies to PFI then leave them to twist in the wind. Where PFI is used, the Treasury must make sure it has been assessed against all the alternatives and then only use it when PFI can be clearly shown to offer taxpayers the best value for money."
The Norfolk and Norwich Hospital is one of the landmark PFI schemes in the region and has come in for criticism from virtually day one. The former Lib Dem health spokesman and MP for North Norfolk Norman Lamb just last year was highly critical of the deal:
"The new Norfolk and Norwich hospital was constructed using PFI. Some years after construction, the private investors refinanced the deal - a bit like re-mortgaging. This delivered a windfall payment of more than £110m. The NHS got just 29% of that gain.
"I took the case to the National Audit Office and asked them to investigate the deal. The Public Accounts Committee subsequently concluded that the extent of benefit to the private partners was too high and the chairman described it as "the unacceptable face of capitalism".
Private Finance Initiatives are a way of building infrastructure - our schools and hospitals, police headquarters and even part of the Foreign Office. Private capital puts in the initial costs and builds and operates the sites; a return on its investment is paid for by the government as annual fees.
Meanwhile, the government gets new development without having to pay for it up-front and some would say, more importantly, without the costs appearing on its books, so it doesn't count as public spending. So what's not to like?
Well, quite a lot actually. When John Major first introduced the model, Labour warned that apparent savings could be very costly in years to come. Nevertheless, PFIs proliferated under Labour and it fell to the Tories to complain.
Chancellor George Osborne, in opposition, had plenty to say about rethinking Labour's flawed policy. So did Vince Cable, now Business Secretary, who described the situation as ludicrous.
The reality, it may not surprise you to learn, is that the Coalition has so far done very little more than examine the cost of the outstanding deals.
Richard Bacon may be whistling in the wind.
Welcome to the political blog for the East. I'm Deborah McGurran, the ´óÏó´«Ã½'s Political Editor for the region. From Lowestoft to Luton, this is the place for politics with an eastern twist.
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