PFI CAMPAIGN CLAIMS VICTORY AS TREASURY ANNOUNCES £1.5 BILLION+ SAVINGS ON PFI

Campaigners for savings on the Private Finance Initiative claimed a huge victory today with the announcement by the Treasury of plans to deliver at least £1.5 billion savings on PFI. All savings will remain within PFI schools, hospitals and other public services, providing a very welcome boost at a time of financial austerity.

The new plans follow a detailed review of PFI costs at the Queen's Hospital, Romford and at two sites of the Ministry of Defence. These identified potential savings of 5%, suggesting that more than £1.5 billion in savings may be achievable over time from the existing contracts.

Jesse Norman MP has led a major parliamentary campaign to make savings on the PFI since last year. Over time the campaign has grown into a cross-party movement of 86 MPs, and received significant coverage across the national, business and PFI press.

Commenting on the news, Jesse said “I am just delighted at the news. I started the campaign because I was so angry at the waste of money through PFI on Hereford Hospital. But I met widespread scepticism that any savings could be made at all.

“Our target was £1 billion in savings, so for the Treasury to announce £1.5 billion is significantly more than we had ever hoped for.

“It is also great news that all the savings will be kept within the public services, as we have recommended. This means at least £1.5 billion more in schoolbooks, medicines and other vital items, which will make a huge difference in these difficult times.

“The government has taken a really workmanlike approach to the PFI over the past year, abolishing PFI Credits, running the savings pilots, clarifying the true level of PFI liabilities and now announcing the present savings plan.

“It inherited a serious mess from the last government, since Gordon Brown and Ed Balls entirely failed to control PFI overspending, and it deserves huge credit for these measures to clear it up.”