Crippling PFI Deals Leave Britain £222bn in Debt


Courtesy of

Every man, woman and child in Britain is more than £3,400 in debt – without knowing it and without borrowing a single penny – thanks to the proliferation of controversial deals used to pay for infrastructure such as schools and hospitals.

The UK owes more than £222bn to banks and businesses as a result of Private Finance Initiatives (PFIs) – “buy now, pay later” agreements between the government and private companies on major projects. The startling figure – described by experts as a “financial disaster” – has been calculated as part of an Independent on Sunday analysis of Treasury data on more than 720 PFIs. The analysis has been verified by the National Audit Office (NAO).

The headline debt is based on “unitary charges” which start this month and will continue for 35 years. They include fees for services rendered, such as maintenance and cleaning, as well as the repayment of loans underwritten by banks and investment companies.


The situation is expected to worsen as PFI projects spread across the world (Getty)

Basically, a PFI is like a mortgage that the government takes out on behalf of the public. The average annual cost of meeting the terms of the UK’s PFI contracts will be more than £10bn over the next decade.

And the cost of servicing PFIs is growing. Last year, it rose by £5bn. It could rise further, with inflation. The upward creep is the price taxpayers’ pay for a financing system which allows private firms to profit from investing in infrastructure.

An NAO briefing, released last month, says: “In the short term using private finance will reduce reported public spending and government debt figures.” But, longer term, “additional public spending will be required to repay the debt and interest of the original investment”.

A case in point is Britain’s biggest health trust, Barts Health NHS Trust in London, which was placed in special measures last month. It is £93m in debt – struggling under the weight of a 43-year PFI contract under which it will pay back more than £7bn on contracts valued at a fraction of that sum (£1.1bn) Continue reading

Stoke NHS Hospital Scanning Contract Won by Private Firm


Courtesy of The Sentinel:

A CONTRACT to diagnose illnesses in thousands of patients has been handed to a private firm even though the NHS offered to do the work for seven million pounds cheaper.

The scans for cancer and other conditions are performed on a state-of-the-art machine at the Royal Stoke University Hospital partly paid for by public donations.

But it is to be operated by staff from Alliance Medical which has been given the scanning service in Staffordshire, Cheshire, Shropshire and Lancashire by the Government.

A competing NHS bid led by Royal Stoke’s trust was turned down by NHS England which had put the work out to tender.

They are now set to remain following the award of the 10-year contract worth an estimated £80 million.

Health campaigners said the move was motivated by political dogma to get the private sector more involved in public services.

It comes as a bitter row continues over the decision to put £1.2 billion of cancer and end-of-of-life care on the market.

Most of the cash for the £3 million machine came from a bequest plus a £1 million Keele University research grant – but £250,000 was donated by the public.

Ron Alcock, aged 75, from Cheadle gave £1,000 after the death of wife Jeannette of leukaemia in 2009.

He said: “Because of Mr Cameron’s policies private firms are coming more into the NHS.

“That scares people that it will be privatised and could deter them from raising money for things in future.” Continue reading

Named and shamed: The government MPs profiting from NHS sell-off


Sickening: These are some of the prominent government ministers who have profited from allowing private companies to provide NHS healthcare services. Meanwhile…

Courtesy of Voxpolitical:

Here’s a new wrinkle on an old story: The social media have been publishing lists of MPs with shares in private healthcare companies – and therefore have their noses in the trough as these companies profit from NHS contracts – since before the Health and Social Care Act 2012 was passed. Now the Unite union has published its own list and the mainstream media have got involved.

Good for Unite – at last this corruption is receiving the attention it deserves.

Named on the list of 71 Coalition MPs (64 Tories; seven Liberal Democrats) are David Cameron and Health Secretary Jeremy Hunt, along with former Health Secretary Andrew Lansley – proving that corruption played a huge part in the introduction of private firms into NHS work.

Nick Clegg and Vince Cable are also named, providing a clear indication of why the Liberal Democrats colluded in this – we can only call it – crime. Even though none of the politicians mentioned in the list acted against current UK laws, they all acted dishonestly in claiming that the change was good for the country when in fact they meant it was good for themselves.

How many of them declared this clear conflict of interest while voting for the Health and Social Care Act in 2012? None seems the most likely answer.

According to the Daily Mirror, “All 71 MPs named in the dossier voted in favour of the Government’s controversial Health and Social Care Act in 2012, which opened up the NHS to more private firms.”

The revelation comes ahead of Friday’s vote on Labour MP Clive Efford’s Private Members’ Bill, which calls on MPs to scrap key sections of the Act.

This Bill is not to be confused with Labour’s plan to abolish the Act altogether, which could only happen after a Labour government is elected in May next year. The UK Parliamentary system works in such a way that the sitting government can never lose a whipped vote as its members outnumber all other groups in the House of Commons; it is a shame that this blog has to spell it out but some readers have demonstrated a lack of understanding in this regard.

The list includes Andrew Lansley’s now-infamous £21,000 donation in November 2009 from John Nash, the former chairman of Care UK, and Jeremy Hunt received more than £20,000 from hedge fund baron Andrew Law, a major investor in healthcare firms. Continue reading

Is the British education system designed to polarise people?

Courtesy of Danny Dorling @ The Guardian:

I grew up in Oxford, but left my hometown to study and then worked at universities in Newcastle, Bristol, Leeds and Sheffield. People who read my words but didn’t hear my accent often assumed I was from the north. But now I’ve come full circle, and have taken up a chair in geography at Oxford University.


It is geography that reveals just how divided we have become as a society in this country. There are places from which it appears almost impossible to succeed educationally and others where it seems very hard to fail. On any given day, a fifth of children in Britain qualify for free school meals. Just one in 100 of those children get to go to either Oxford or Cambridge University. Four private schools and one highly selective state sixth-form college send more children to Oxbridge than do 2,000 other secondary schools. The most prestigious 100 schools secure 30% of all Oxbridge places. And 84 of them are private schools.

People often complain that the national debate on higher education is unfairly dominated by interest in entry to these two universities. But it matters. The richest 1% (people with a pre-tax household income of at least £160,000) dominate decision-making in this country. How they behave is a weathervane for social mobility in Britain. Continue reading

Britain Needs a New Model for Energy

Courtesy of The Morning Star Online:

There was understandable fury around Britain on Saturday morning at the continuing problems in restoring power to more than 1,000 homes — and the offer from UK Power Networks to up compensation from £27 to £75 has understandably provoked further ire.

For those forced to live on takeaways or eat out, to move across the country to stay with relatives who do have power or otherwise fork out cash to deal with their situation, that’s hardly going to recompense them fairly.

And they were asking, rightly, why it is taking so long.

First, we have to offer them our sympathy and best wishes and hope that the further forecast rough weather isn’t going to cause them and others further hardship.

And we need to recognise that many workers, for the companies and the emergency services, also had their Christmas plans interrupted and have been working hard to repair the damage.

But Britons simply don’t trust our privatised energy companies any more, and with good reason.

They know that they are profit-making companies which operate with the aim of maximising shareholder return, not ensuring a secure, affordable energy supply for the public. Continue reading

The real reason why energy prices are spiralling out of control

Courtesy of CITY AM:

LIKE most readers, I have had my run-ins with energy companies. One especially pushy door to door salesperson once tried to forcefully convince me that I needed to sign up to his firm because I had just moved into a new home. Fortunately, I wasn’t naïve enough to succumb to his lies but many others were fooled; the unpleasant practice of sending cold-callers to knock on people’s doors has fortunately now been ditched by most of the industry. More recently, I was forced to part company with one supplier after the member of staff who showed up unannounced at my house turned out to be as rude as he was incompetent.

We’ve all been there at one point or another. Like many large consumer-facing UK companies, energy firms’ customer service remains woeful. It’s a nightmare trying to get through to helplines; and most of us know of people who have been harassed for bills that were in fact incurred by previous owners or tenants and wrongly sent nasty letters threatening bailiffs.

But while firms urgently need to get their act together on all of these issues, it is important to dispassionately analyse what is driving up energy prices and not to allow irritation at this widespread corporate stupidity to cloud our judgment. British Gas’s price hike yesterday was primarily caused by forces out of its own control – forces that politicians, not businesses, are directly responsible for. Continue reading