Payments to private companies for public assets have exceeded construction costs by over three times, new research into Private Finance Initiative (PFI) contracts has revealed.
A review of 1,000 financial accounts by the National Institute of Economic and Social Research (NIESR) found that £13.5bn is spent at the local level on PFI repayments, of which 31% pays for interest costs.
The NIESR also found that £1bn has been made in pre-tax profits by just a handful of companies, often registered in Guernsey and Jersey.
Max Mosley, a senior economist at NIESR, commented: ‘We are spending far more in PFI repayments than the value of the assets.’
