2/17/11

The plot thickens: British government opens negotiations with P3 corporations to cut costs

The British government, which claims to be clamping down on public spending, has opened negotiations with the corporations involved in government funded "public private partnerships" (P3s, or PFIs as the British call them).  The Independent reports

'One hospital was reported to have been charged £333 by a PFI firm to change a light bulb, while a school was charged £300 for an electricity socket...The industry could become the next target for public anger after the banks. Uncertainty around the future of the contracts could also impact on the companies' share price. Ministers think this is behind the willingness to do a deal…. (A) Treasury source said: "PFI is not immune from other savings in the public sector during the current economic downturn and we are looking to make savings.”'


But it's hard to believe the British "Con-Dem" government will achieve anything much here (other than a media release announcing savings). 


And indeed, publicly, the P3 industry isn't giving much ground, warning that a squeeze on P3 profits might jeopardise the chances of investment in future public-sector projects. Elizabeth Fells, head of public services reform at the Confederation of British Industry, said: "The Government needs to maintain private-sector confidence in the market, otherwise it could jeopardise future investment in infrastructure projects."


dallan@cupe.ca

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