Thursday 3 June 2010

PFI costs continue to rise

Labour are constantly bleating these days about jobs in the NHS and teacher numbers. The truth behind the stories, however, reveals Labour's complete and utter hypocrisy.

Labour choose to ignore the impact of their profligate PFI credit card spending on education and health budgets.
Figures released in March demonstrated quite clearly that the more Councils have to spend on paying their PFI costs, the less they have in their education budget to spend on teachers.

In Glasgow, PFI payments represent 8.6% of the Education budget for the city - and considering that budget is around £515m, that represents quite a wadge of cash. How many more teachers could be employed for that sum? How many more nursery places could be provided?

I'm not in any way arguing for the closure of schools, but
the PFI contracts in Glasgow were so ill-thought out that they have also had the effect of the forced maintaining of secondary schools which have so few pupils that key subjects like history are being dropped. When Primary Schools in the city were described as being 'half empty' plans were brought forward to close them. The Council can't possibly do this for secondaries, as we're still paying for their refurbishment. Primaries and nurseries have been moved into schools to mitigate the effect of this, but in reality, the Council has been tied to the dead weight of the PFI deal and can't do much about it.

Today, I see that Tris has a
blog post showing that the NHS are facing a similar problem.

Kenny Gibson MSP puts it well when he says:

“PFI is typical of Labour’s irresponsible buy now, pay later approach to public spending.

“The NHS will pay more to banks in repayments over the next five years for three hospitals than those hospitals are actually worth. That is an example of the profligacy and incompetence that characterised Labour’s financial management and that Scotland’s public services are now paying for."

The really frustrating thing is that we're tied into these contracts. Our health boards, Councils and Government have to pay over the odds for something that we don't want and even warned wouldn't work. We must strive to remind the voters of this truth, whenever Labour trot out lines on cuts. The SNP are fighting to keep jobs in Education and the NHS, despite having to cope with the consequences of Labour's buy now-pay later policies.


Doug Daniel said...

Maybe I'm being too simplistic and ignoring the subtleties of these deals, but I don't understand why we can't just say "actually, no - were not going to pay these PFI contracts. We'll pay you what the schools are worth, and not a penny more." Can't Parliament pass some law saying councils can't be held to ransom for these deals?

Particularly in cases when the banks in question are ones that are effectively state-owned thanks to the bailouts. Just think, we Scots used to be famous for our financial thrift. HA! Pity somebody forgot to tell Scottish Labour.

What sickens me most is that they don't even get it yet - if they had it their way, we'd still be doing it!

Scotal said...

In 1974 I went to my first secondary teaching post in Notre Dame High School in Greenock. It was a brand new building. In 2005 it was pulled down.The school moved to the neighbouring Cowdenowes High School. It had been built at the same time as Notre Dame. Last year the kids were decanted to temporary accommodation and this 35 year old building was also pulled down. A new Notre Dame is currently being built on the site.This pattern repeats all over Scotland. It is as you say the Labour madhouse which is costing thousands of jobs.

BellgroveBelle said...

Doug - as far as I know, the contracts are tightly binding. Even getting some additional work done in Glasgow schools cost the city dearly.

Despite our shareholding stake, it seems we can't do much about the banks, as the Cadbury's debacle proved. I don't quite understand why, and if there's a way around it, it must be found and used.

I agree with you, it's crazy that, despite all this they still believe in PFI!

Scotal - my high school (of a similar age) was also pulled down. It was perfectly adequate, had lots of space, well appointed art department and a purpose built theatre. All gone. I can't even bear to go back and see the new building.

joe90 kane said...

Thanks for that BB.

PFI-PPP are both a disgrace to the public taxpayer, to democracy and public accountability and open-ness and to the supposed free-market, which these get-rich-quick schemes by fleecing the taxpayer are a direct attack on as those inolved aren't in a competition and have guaranteed returns regardless of performance - most of the statistics associated with PPP-PFI remind me of Stalinist Russia's phoney facts and figures about its economy and industries and services.

Try -
NHS scandal as £1 billion goes down PFI drain
03 June 2010

One of the commenteers on the small discussion thread, Traquir, I always find very informative.

all the best