Being centrist does not make you a Tory, let alone a Thatcherite.. I would not vote conservative, but I am not a Socialist in my views. So go easy with that pot of blue paint
You are entitled to your own views, and I am entitled to mine.
Indeed, but you didn't express your views, you insinuated that everyone who disagrees with you about Blair places the centre at Michael Foot.
I think that's unfair. Not least because the argument that Blair is a closet Tory was not articulated either.
Tony Blair is to the right of me but he's not right wing or Thatcherite in any real sense and the lazy suggestion that he's just another Tory is a bit tedious and does not help further the discussion.
Especially when we've had a decade of right wing government's pretending to be centrist. Cameron is perhaps the most socially liberal of the lot but he's economically right wing, and whilst he probably didn't believe in it, he did move policy to the right in an attempt to appease those of his supporters tempted to vote UKIP.
The Left undermines and denigrates its own successes. By doing so, they cede the argument to the right-wing 'thinkers' and the Overton window slips more to the right. We can never win that way.
Anyway to circle back to the point. I really want to know more about the circumstances of these policy discussions and what happened next. I am very unhappy with the conversations that seemed to have taken place. However, I will reiterate that Johnson introduced such a policy, Blair never ever hinted at one. No test balloons, no leaks to see how the public might react. That is a huge difference.
That's not to say that I don't long for better articulation and moral leadership from Labour, I really do. It's really quite enjoyable watching Evette Cooper dismantle each Home Secretary in turn but for me, she does it by laying bare the complete lack of competence for 90% of the time. Which is fine and very effective. But, but but; She does not speak to the immorality enough. Not nearly enough.*
AFZ
*There may be some very good political strategic reasons at play here but I still don't like it.
Tony Blair sold off the railways as I remember and pushed what he called The Public Private Partnership. Both these and others he put out are Tory polices. You don’t have, as stated be the ERG or any other right wing extreme group to be a Conservative politician. Many on the centre are close to Blair’s ideals.
Let’s not forget that Starmer threw out most if not all of the socialist left MPs when he got the leadership. There is a lot of common ground between none right wing Tories and Starmer and Blair
This is just factually incorrect.
Major's government privatised the railways. The only major action by Blair's government was the nationalisation of Rail Track, now Network Rail. Private Public Partnerships were a Conservative policy. New Labour used PFI - Private Finance Initiative which is very similar. Now the debate about PFI is actually really complex. It is not helped by the fact that it's almost always misrepresented in the media.
Being centrist does not make you a Tory, let alone a Thatcherite.. I would not vote conservative, but I am not a Socialist in my views. So go easy with that pot of blue paint
You are entitled to your own views, and I am entitled to mine.
Indeed, but you didn't express your views, you insinuated that everyone who disagrees with you about Blair places the centre at Michael Foot.
I think that's unfair. Not least because the argument that Blair is a closet Tory was not articulated either.
Tony Blair is to the right of me but he's not right wing or Thatcherite in any real sense and the lazy suggestion that he's just another Tory is a bit tedious and does not help further the discussion.
Especially when we've had a decade of right wing government's pretending to be centrist. Cameron is perhaps the most socially liberal of the lot but he's economically right wing, and whilst he probably didn't believe in it, he did move policy to the right in an attempt to appease those of his supporters tempted to vote UKIP.
The Left undermines and denigrates its own successes. By doing so, they cede the argument to the right-wing 'thinkers' and the Overton window slips more to the right. We can never win that way.
Anyway to circle back to the point. I really want to know more about the circumstances of these policy discussions and what happened next. I am very unhappy with the conversations that seemed to have taken place. However, I will reiterate that Johnson introduced such a policy, Blair never ever hinted at one. No test balloons, no leaks to see how the public might react. That is a huge difference.
That's not to say that I don't long for better articulation and moral leadership from Labour, I really do. It's really quite enjoyable watching Evette Cooper dismantle each Home Secretary in turn but for me, she does it by laying bare the complete lack of competence for 90% of the time. Which is fine and very effective. But, but but; She does not speak to the immorality enough. Not nearly enough.*
AFZ
*There may be some very good political strategic reasons at play here but I still don't like it.
Tony Blair sold off the railways as I remember and pushed what he called The Public Private Partnership. Both these and others he put out are Tory polices. You don’t have, as stated be the ERG or any other right wing extreme group to be a Conservative politician. Many on the centre are close to Blair’s ideals.
Let’s not forget that Starmer threw out most if not all of the socialist left MPs when he got the leadership. There is a lot of common ground between none right wing Tories and Starmer and Blair
This is just factually incorrect.
Major's government privatised the railways. The only major action by Blair's government was the nationalisation of Rail Track, now Network Rail. Private Public Partnerships were a Conservative policy. New Labour used PFI - Private Finance Initiative which is very similar. Now the debate about PFI is actually really complex. It is not helped by the fact that it's almost always misrepresented in the media.
AFZ
From what I've seen PFI is a system to replace public investment with rent-seeking opportunities for the already wealthy. Whether the primary goal was to keep investment in new hospitals and schools "off balance sheet" (and give the appearance of lower public debt at the cost of greater long-term operating costs) or to further enrich the "investors" is a moot point.
Most NuLab privatisation was done on the sly - "outsourcing" of everything they could get away with, leading to the rise of jack-of-all-trades-master-of-none firms like Capita.
From what I've seen PFI is a system to replace public investment with rent-seeking opportunities for the already wealthy. Whether the primary goal was to keep investment in new hospitals and schools "off balance sheet" (and give the appearance of lower public debt at the cost of greater long-term operating costs) or to further enrich the "investors" is a moot point.
It's not that simple. I have worked in a PFI-funded hospital. I have worked in crumbling buildings and I have worked in a trust that took on a massive loan to avoid PFI and that had other problems. So I have lived this. However, more interestingly, I looked into it properly about 12-13 years ago.
At that time, there were headlines about £11Bn assets costing the taxpayer £40Bn over 30 years. (I think that's correct but I can't promise I've recalled it precisely). This intrigued me so I did a little maths on it. Now there is a major limitation in that the deals are not totally in the public domain. In fact, most of the details are hidden for 'commercial reasons.' Therefore it is only possible to talk in general terms. However the headline is that the £11Bn assets cost the taxpayer about what you would expect.
So, let's talk about what we're talking about. PFI was a contract between the government (most often the NHS or the DfE) for a private company to build a new hospital or school (etc.) and then for the public sector to pay for it over the course of 20-30 years with a maintenance contract tied in for the period of the contract as well.
If we take the £11Bn of assets build in the mid-2000s and work from there, where do we get to? Well, first of all let's just cover the basics: a new hospital (school etc.) has to be built by a private company. That's inevitable unless we set up a state building company and there's plenty of good arguments against that. Traditionally, the government would provide the capital and pay a contractor to build. The difference with PFI, primarily is that the contractor also brings the finance to the deal. If we went down the traditional route, the government would pay the price upfront and that would be that. So the bill for all these assets would be nominally £11Bn. Of course, the government would (and should!) finance this by borrowing in the form of government bonds. If you look at where interest rates were in the mid-2000s for government bonds and work out the cost of borrowing £11Bn over the course of the loan it comes in at around £30Bn (from memory. I can't be bothered to go and look up the rates and the figures properly but you get the idea. You can do these calculations quite simply by using a mortgage calculator - the principle is the same). Now what we're talking about is the government paying private companies £40Bn when it could have cost £30Bn (i.e. NOT £11Bn). These are not inflation-adjusted figures, just the cash numbers: £30Bn over 30 years. In this context, it is totally analogous to an individual buying a house with a mortgage.
This is the first way in which the headline figures are deeply misleading. Now, that's still profiteering, of course as that's a 33% markup effectively. However, the £40Bn headline figure includes the long-term maintenance contracts. Again, we have to average out here but we're talking £10Bn over ~25 years or £400m/year on £11Bn worth of assets. Difficult to be exact here as the details matter but on the face of it, that's about right. So, the headline figures that are in the public-domain show that PFI is about right for value-for-money for the taxpayer. Now, that doesn't make it true necessarily but the information that is available does not show PFI to be a bad thing. There is another layer to this which is also interesting but before that, a little interlude.
Around the same time, there was a lot of headlines about extra costs. I.e. the private company charging the hospital/school etc. for extra things. £300 to have a new power socket put in would be a typical headline. Again, it's impossible to know if this is reasonable or not. If we pause for a moment to consider what's involved in adding a new electrical socket to a hospital ward. It is more complex than a home environment. Many wards have uninterrupted power supply circuits. All of them have equipment that you don't want to switch off. Therefore isolating the power so it's safe to do the work and completing it safely in an environment where patient care is still on-going is much more complex than installing a socket in a home. And you'd definitely want it done by a qualified electrician... So again, it's impossible to know if the quoted £300 is price-gouging or a realistic price for a professional service to be carried out safely in a specific situation.
So, onwards... The headline costs of PFI as essentially in line with costs to be found by other funding methods. There is one clear and one controversial advantage of PFI. The clear one is this: The building contractor is also the maintenance contractor and thus if the building work is shoddy, they will bear the consequential maintenance costs. This is a natural insurance system, protecting the public sector from this risk. The controversial one is political. In 1997, the public sector estate was in an appalling state due to a shocking lack of care from the previous government who simply did not fund maintenance properly. Any new hospitals build by New Labour 1997-2010 would be at risk of the same skinflint approach to the public realm. By locking the maintenance in from the beginning, the Labour government was tying the hands of future governments and forcing them to pay for the maintenance and it's all wrapped up in the PFI deal. There is a strong democratic/constitutional argument that this is wrong and not what a government should do. There's a strong practical argument that past (and future - i.e. 2010-2024) experience shows this was a shrewd move. I leave you to decide how you feel about this.
For me, there are two big problems with PFI in reality. The first is the lack of transparency. There are some that are good deals for the taxpayer. It's worth remembering that there will always be a private sector / public sector interface of some sort. The private company provides a good service and makes a fair return. There are some that have allowed profiteering. (I THINK). That's my best guess based on the limited amount in the public realm. But it's an assessment that I'm comfortable with. The second is that the NHS trust / local schools etc. took on the debt. If the money came from the Treasury then the debt would have been in the form of government bonds. A few million to build a new hospital is a minimal risk in terms of debt for the Treasury. Conversely, servicing that debt is a measurable chunk of a trust's budget. This shifting of the liability is a problem. However, again, the headlines about 'crippling' PFI payments for the NHS are deeply misleading as we're talking about, at most 2% of the NHS budget. It's a lack of funding that cripples the NHS.
Tying this all together, PFI would not be my preferred way of doing things. However, unlike the current mob, New Labour did build new hospitals (and schools). These buildings with their attached PFI contracts have been properly maintained and as far as we can tell the costs have been about right to the tax-payer (for the most part).
My point and TL:DR is this: whilst PFI is not perfect, it's actually ok and using it as an attack line against the last Labour government makes very little sense. Labour built hospitals (c.f. "Boris") when they were desperately needed and we're using them. That's a good outcome for the taxpayer.
My direct experience with PFI was in university accommodation, where the private operator took over all existing accommodation, and was guaranteed 30 years of RPI+3% rises on both new and existing accommodation. They then proceeded to make an absolute hash of new accommodation, which was both unfinished and poorly constructed (one example: pre built en-suites were dropped in, but the ground floor had level entry, the first floor 3" up and the second floor 6" up to step in because they built the walls the wrong height). The rent rises we only found out about because I used one of the very first FOI requests (for which I do give credit to the Blair government) to extract hundreds of pages of contracts related to the deal, for which they wanted £80 back in 2005. My impression of them was further informed by George Monbiot's research on the subject, documented in Captive State.
My direct experience with PFI was in university accommodation, where the private operator took over all existing accommodation, and was guaranteed 30 years of RPI+3% rises on both new and existing accommodation. They then proceeded to make an absolute hash of new accommodation, which was both unfinished and poorly constructed (one example: pre built en-suites were dropped in, but the ground floor had level entry, the first floor 3" up and the second floor 6" up to step in because they built the walls the wrong height). The rent rises we only found out about because I used one of the very first FOI requests (for which I do give credit to the Blair government) to extract hundreds of pages of contracts related to the deal, for which they wanted £80 back in 2005. My impression of them was further informed by George Monbiot's research on the subject, documented in Captive State.
Good use of FOI!
There is no doubt that in some PFI deals the private company took the public sector for a ride. Quite possibly because of a lack of contractual expertise on the part of civil servants. That problem is not peculiar to PFI, however.
I remain torn. For the reasons outlined above, much of the criticism is simplistic and misplaced but your example is hardly unique. The question that is begged is what would it look like if the big infrastructure builds had been done by non-PFI routes. I would argue that it's much the same - it depends on getting the contracts right. I had to cut out above my experience of PFI working due to space but it was essentially it worked, was just slow to get things done.
However, the overarching point is that Blair/Brown's use of PFI was not for some right-wing ideological reason (See here, the VIP lane for Covid contracts) but a belief that this would get the much-needed public capital investment in place.
My point remains that using it as evidence of New Labour being Right Wing doesn't stand up to analysis. You could argue it makes them Third Way believers and not as Left as you or I might like... That I would agree with.
But elections are always a choice between the candidates that are standing not the ones we wish were. Pretending that Labour is no different to the Tories just gives them a free pass for EVERYTHING and that is how our democracy dies.
I wouldn't say they're identical, but they are both well into right wing territory, particularly as we're comparing NuLab in boom years with tories in successive crises (not all of which were of their own making). PFI is a symptom of an ideology that says the private sector is always better and should be used at every opportunity, that it is inherently more efficient and productive than public service. That's not pragmatic, that's not "third way", that's right wing ideology. Hence all council housing stock being transferred to housing associations, the creation of academies, relying on private work capability assessments rather than NHS doctors etc. etc.
This is the first way in which the headline figures are deeply misleading. Now, that's still profiteering, of course as that's a 33% markup effectively. However, the £40Bn headline figure includes the long-term maintenance contracts. Again, we have to average out here but we're talking £10Bn over ~25 years or £400m/year on £11Bn worth of assets. Difficult to be exact here as the details matter but on the face of it, that's about right.
So absent a real world example I don't think it's worth getting into the weeds here; so will limit myself to a few general observations - and this may be a discussion worth taking to Purgatory instead.
In the simplest case where the government is contracting out the provision of infrastructure to a private company rather than borrowing to cover the costs, the contract will include that company's cost of capital which will be higher than the gilt rate.
So, onwards... The headline costs of PFI as essentially in line with costs to be found by other funding methods. There is one clear and one controversial advantage of PFI. The clear one is this: The building contractor is also the maintenance contractor and thus if the building work is shoddy, they will bear the consequential maintenance costs. This is a natural insurance system, protecting the public sector from this risk.
Post Carillion it's increasingly hard to make this argument stick. For larger ticket items there's a virtual oligopoly in operation and the government is wary of threatening the financial stability of a particular company because of possible knock on impacts on other contracts and/or being left dealing with a monopoly supplier.
Okay, but the government is focusing on core competencies and buying in expertise! Except on examining these organizations, they consist of a central bid team that hunts down large contracts and then recruits to deliver them and then dispersing teams when complete. Essentially doing the same thing the government is doing, albeit at one remove.
There is no doubt that in some PFI deals the private company took the public sector for a ride. Quite possibly because of a lack of contractual expertise on the part of civil servants. That problem is not peculiar to PFI, however.
The lack of contractual expertise is largely a function of not running these projects in house, without which civil servants don't have the background to draft the contract. £300 for a power switch, or £3000 for moving a desk make headlines, but the real costs are usually in the large amounts of 'change control' along the way.
One of the problems with PFI/privatisation/outsourcing was that public sector officials rarely had the skills needed to negotiate with and subsequently oversee the private sector 'partners'. Why should they have? It was not previously part of their job and they rarely, if ever, received training of any kind, let alone the in-depth training required. In short, it was like expecting (say) a plumber to take on the management of a professional football club.
One of my 'experiences' as an education officer was overseeing a design and build contract to build a primary school with a very well-known company. The company people were very nice and provided excellent tea and biscuits at their local HQ for meetings. After about 12 months of messing around, we realised that they were not really interested in the job. It was petty cash from their POV, they had much more profitable work elsewhere. So all that was achieved was the delay of the project for 12 months. A further delay of 12 months was caused by Great Crested Newts, but that's another story. All this dilly-dallying cost the taxpayer £££s, but no one seemed to care. Well, I did, but next to the Great God of Public/Private Partnerships, I was nothing.
One of the problems with PFI/privatisation/outsourcing was that public sector officials rarely had the skills needed to negotiate with and subsequently oversee the private sector 'partners'. Why should they have? It was not previously part of their job and they rarely, if ever, received training of any kind, let alone the in-depth training required. In short, it was like expecting (say) a plumber to take on the management of a professional football club.
One of my 'experiences' as an education officer was overseeing a design and build contract to build a primary school with a very well-known company. The company people were very nice and provided excellent tea and biscuits at their local HQ for meetings. After about 12 months of messing around, we realised that they were not really interested in the job. It was petty cash from their POV, they had much more profitable work elsewhere. So all that was achieved was the delay of the project for 12 months. A further delay of 12 months was caused by Great Crested Newts, but that's another story. All this dilly-dallying cost the taxpayer £££s, but no one seemed to care. Well, I did, but next to the Great God of Public/Private Partnerships, I was nothing.
Oh yes, trying to figure out whether building contractors have any interest in the job you're proposing has got to be one of the biggest sources of delays for the inexperienced client. We had site visits with builders who just ghosted us, and others who'd promise to get back to us and never did.
One of the problems with PFI/privatisation/outsourcing was that public sector officials rarely had the skills needed to negotiate with and subsequently oversee the private sector 'partners'. Why should they have? It was not previously part of their job and they rarely, if ever, received training of any kind, let alone the in-depth training required. In short, it was like expecting (say) a plumber to take on the management of a professional football club.
Very neatly summarised, and it applies to both central and local government.
If we look back 50-60 years large local authorities had their own Works Departments which took on large-scale building projects from design to build - many award-winning architects started their working lives apprenticed in a local authority office. What happened to change this was the RIBA doing away with the pupillage route to qualification (and the way they went about that was a scandal in itself) which was followed by LAs deciding to "buy-in" expertise. Now, a generation down the line you have a situation where people supposed to commission and run large-scale projects worth many millions have no more expertise than an enthusiastic DIY-er (if you're lucky). The ignorance of many in the planning bureaucracy is bad enough at individual homeowner level - for large-scale works it is disastrous.
As for central government, the situation is, if anything, worse: projects are started and stopped at will, there is a fixation with perceived value for money that doesn't understand either the time-scales of build or the lead-times for supply, and the continual attempts to squash two projects into one "to save money" is resulting in more waste. Look no further than HS2 if you want to see what a combination of ignorance, political expediency and bureaucratic ineptitude gets you. Special Award for incompetence must go to the MoD where a combination of bureaucrats with no idea overseen by a rapid turnover of similarly ignorant politicians, sprinkled with some inter-service rivalry, results in grotesque overruns and kit that cannot ever work as designed or desired.
[A gallant example of a private organisation imitating HMG is the CofE, particularly in relation to housing.]
One of the problems with PFI/privatisation/outsourcing was that public sector officials rarely had the skills needed to negotiate with and subsequently oversee the private sector 'partners'. Why should they have? It was not previously part of their job and they rarely, if ever, received training of any kind, let alone the in-depth training required. In short, it was like expecting (say) a plumber to take on the management of a professional football club.
.
At the national level this problem dates back to the abolition of the Ministry of Public Buildings and Works. This centralised expertise amd provided a distinct career ladder for those expert in the management of such projects. Devolving this work to separate government departments led to many projects being supervised by non-specialists, often at a relatively junior level, with some other non-specialist higher up the chain of command having notional responsibility, with no one in charge actually knowing how to do the job well.
Comments
This is just factually incorrect.
Major's government privatised the railways. The only major action by Blair's government was the nationalisation of Rail Track, now Network Rail. Private Public Partnerships were a Conservative policy. New Labour used PFI - Private Finance Initiative which is very similar. Now the debate about PFI is actually really complex. It is not helped by the fact that it's almost always misrepresented in the media.
AFZ
From what I've seen PFI is a system to replace public investment with rent-seeking opportunities for the already wealthy. Whether the primary goal was to keep investment in new hospitals and schools "off balance sheet" (and give the appearance of lower public debt at the cost of greater long-term operating costs) or to further enrich the "investors" is a moot point.
Most NuLab privatisation was done on the sly - "outsourcing" of everything they could get away with, leading to the rise of jack-of-all-trades-master-of-none firms like Capita.
It's not that simple. I have worked in a PFI-funded hospital. I have worked in crumbling buildings and I have worked in a trust that took on a massive loan to avoid PFI and that had other problems. So I have lived this. However, more interestingly, I looked into it properly about 12-13 years ago.
At that time, there were headlines about £11Bn assets costing the taxpayer £40Bn over 30 years. (I think that's correct but I can't promise I've recalled it precisely). This intrigued me so I did a little maths on it. Now there is a major limitation in that the deals are not totally in the public domain. In fact, most of the details are hidden for 'commercial reasons.' Therefore it is only possible to talk in general terms. However the headline is that the £11Bn assets cost the taxpayer about what you would expect.
So, let's talk about what we're talking about. PFI was a contract between the government (most often the NHS or the DfE) for a private company to build a new hospital or school (etc.) and then for the public sector to pay for it over the course of 20-30 years with a maintenance contract tied in for the period of the contract as well.
If we take the £11Bn of assets build in the mid-2000s and work from there, where do we get to? Well, first of all let's just cover the basics: a new hospital (school etc.) has to be built by a private company. That's inevitable unless we set up a state building company and there's plenty of good arguments against that. Traditionally, the government would provide the capital and pay a contractor to build. The difference with PFI, primarily is that the contractor also brings the finance to the deal. If we went down the traditional route, the government would pay the price upfront and that would be that. So the bill for all these assets would be nominally £11Bn. Of course, the government would (and should!) finance this by borrowing in the form of government bonds. If you look at where interest rates were in the mid-2000s for government bonds and work out the cost of borrowing £11Bn over the course of the loan it comes in at around £30Bn (from memory. I can't be bothered to go and look up the rates and the figures properly but you get the idea. You can do these calculations quite simply by using a mortgage calculator - the principle is the same). Now what we're talking about is the government paying private companies £40Bn when it could have cost £30Bn (i.e. NOT £11Bn). These are not inflation-adjusted figures, just the cash numbers: £30Bn over 30 years. In this context, it is totally analogous to an individual buying a house with a mortgage.
This is the first way in which the headline figures are deeply misleading. Now, that's still profiteering, of course as that's a 33% markup effectively. However, the £40Bn headline figure includes the long-term maintenance contracts. Again, we have to average out here but we're talking £10Bn over ~25 years or £400m/year on £11Bn worth of assets. Difficult to be exact here as the details matter but on the face of it, that's about right. So, the headline figures that are in the public-domain show that PFI is about right for value-for-money for the taxpayer. Now, that doesn't make it true necessarily but the information that is available does not show PFI to be a bad thing. There is another layer to this which is also interesting but before that, a little interlude.
Around the same time, there was a lot of headlines about extra costs. I.e. the private company charging the hospital/school etc. for extra things. £300 to have a new power socket put in would be a typical headline. Again, it's impossible to know if this is reasonable or not. If we pause for a moment to consider what's involved in adding a new electrical socket to a hospital ward. It is more complex than a home environment. Many wards have uninterrupted power supply circuits. All of them have equipment that you don't want to switch off. Therefore isolating the power so it's safe to do the work and completing it safely in an environment where patient care is still on-going is much more complex than installing a socket in a home. And you'd definitely want it done by a qualified electrician... So again, it's impossible to know if the quoted £300 is price-gouging or a realistic price for a professional service to be carried out safely in a specific situation.
So, onwards... The headline costs of PFI as essentially in line with costs to be found by other funding methods. There is one clear and one controversial advantage of PFI. The clear one is this: The building contractor is also the maintenance contractor and thus if the building work is shoddy, they will bear the consequential maintenance costs. This is a natural insurance system, protecting the public sector from this risk. The controversial one is political. In 1997, the public sector estate was in an appalling state due to a shocking lack of care from the previous government who simply did not fund maintenance properly. Any new hospitals build by New Labour 1997-2010 would be at risk of the same skinflint approach to the public realm. By locking the maintenance in from the beginning, the Labour government was tying the hands of future governments and forcing them to pay for the maintenance and it's all wrapped up in the PFI deal. There is a strong democratic/constitutional argument that this is wrong and not what a government should do. There's a strong practical argument that past (and future - i.e. 2010-2024) experience shows this was a shrewd move. I leave you to decide how you feel about this.
For me, there are two big problems with PFI in reality. The first is the lack of transparency. There are some that are good deals for the taxpayer. It's worth remembering that there will always be a private sector / public sector interface of some sort. The private company provides a good service and makes a fair return. There are some that have allowed profiteering. (I THINK). That's my best guess based on the limited amount in the public realm. But it's an assessment that I'm comfortable with. The second is that the NHS trust / local schools etc. took on the debt. If the money came from the Treasury then the debt would have been in the form of government bonds. A few million to build a new hospital is a minimal risk in terms of debt for the Treasury. Conversely, servicing that debt is a measurable chunk of a trust's budget. This shifting of the liability is a problem. However, again, the headlines about 'crippling' PFI payments for the NHS are deeply misleading as we're talking about, at most 2% of the NHS budget. It's a lack of funding that cripples the NHS.
Tying this all together, PFI would not be my preferred way of doing things. However, unlike the current mob, New Labour did build new hospitals (and schools). These buildings with their attached PFI contracts have been properly maintained and as far as we can tell the costs have been about right to the tax-payer (for the most part).
My point and TL:DR is this: whilst PFI is not perfect, it's actually ok and using it as an attack line against the last Labour government makes very little sense. Labour built hospitals (c.f. "Boris") when they were desperately needed and we're using them. That's a good outcome for the taxpayer.
AFZ
Good use of FOI!
There is no doubt that in some PFI deals the private company took the public sector for a ride. Quite possibly because of a lack of contractual expertise on the part of civil servants. That problem is not peculiar to PFI, however.
I remain torn. For the reasons outlined above, much of the criticism is simplistic and misplaced but your example is hardly unique. The question that is begged is what would it look like if the big infrastructure builds had been done by non-PFI routes. I would argue that it's much the same - it depends on getting the contracts right. I had to cut out above my experience of PFI working due to space but it was essentially it worked, was just slow to get things done.
However, the overarching point is that Blair/Brown's use of PFI was not for some right-wing ideological reason (See here, the VIP lane for Covid contracts) but a belief that this would get the much-needed public capital investment in place.
My point remains that using it as evidence of New Labour being Right Wing doesn't stand up to analysis. You could argue it makes them Third Way believers and not as Left as you or I might like... That I would agree with.
But elections are always a choice between the candidates that are standing not the ones we wish were. Pretending that Labour is no different to the Tories just gives them a free pass for EVERYTHING and that is how our democracy dies.
AFZ
So absent a real world example I don't think it's worth getting into the weeds here; so will limit myself to a few general observations - and this may be a discussion worth taking to Purgatory instead.
In the simplest case where the government is contracting out the provision of infrastructure to a private company rather than borrowing to cover the costs, the contract will include that company's cost of capital which will be higher than the gilt rate.
Post Carillion it's increasingly hard to make this argument stick. For larger ticket items there's a virtual oligopoly in operation and the government is wary of threatening the financial stability of a particular company because of possible knock on impacts on other contracts and/or being left dealing with a monopoly supplier.
Okay, but the government is focusing on core competencies and buying in expertise! Except on examining these organizations, they consist of a central bid team that hunts down large contracts and then recruits to deliver them and then dispersing teams when complete. Essentially doing the same thing the government is doing, albeit at one remove.
The lack of contractual expertise is largely a function of not running these projects in house, without which civil servants don't have the background to draft the contract. £300 for a power switch, or £3000 for moving a desk make headlines, but the real costs are usually in the large amounts of 'change control' along the way.
There's a good post on this topic here:
https://www.harrowell.org.uk/blog/2018/01/31/in-the-eternal-inferno-fiends-torment-ronald-coase-with-the-fate-of-his-ideas/
One of my 'experiences' as an education officer was overseeing a design and build contract to build a primary school with a very well-known company. The company people were very nice and provided excellent tea and biscuits at their local HQ for meetings. After about 12 months of messing around, we realised that they were not really interested in the job. It was petty cash from their POV, they had much more profitable work elsewhere. So all that was achieved was the delay of the project for 12 months. A further delay of 12 months was caused by Great Crested Newts, but that's another story. All this dilly-dallying cost the taxpayer £££s, but no one seemed to care. Well, I did, but next to the Great God of Public/Private Partnerships, I was nothing.
Oh yes, trying to figure out whether building contractors have any interest in the job you're proposing has got to be one of the biggest sources of delays for the inexperienced client. We had site visits with builders who just ghosted us, and others who'd promise to get back to us and never did.
Very neatly summarised, and it applies to both central and local government.
If we look back 50-60 years large local authorities had their own Works Departments which took on large-scale building projects from design to build - many award-winning architects started their working lives apprenticed in a local authority office. What happened to change this was the RIBA doing away with the pupillage route to qualification (and the way they went about that was a scandal in itself) which was followed by LAs deciding to "buy-in" expertise. Now, a generation down the line you have a situation where people supposed to commission and run large-scale projects worth many millions have no more expertise than an enthusiastic DIY-er (if you're lucky). The ignorance of many in the planning bureaucracy is bad enough at individual homeowner level - for large-scale works it is disastrous.
As for central government, the situation is, if anything, worse: projects are started and stopped at will, there is a fixation with perceived value for money that doesn't understand either the time-scales of build or the lead-times for supply, and the continual attempts to squash two projects into one "to save money" is resulting in more waste. Look no further than HS2 if you want to see what a combination of ignorance, political expediency and bureaucratic ineptitude gets you. Special Award for incompetence must go to the MoD where a combination of bureaucrats with no idea overseen by a rapid turnover of similarly ignorant politicians, sprinkled with some inter-service rivalry, results in grotesque overruns and kit that cannot ever work as designed or desired.
[A gallant example of a private organisation imitating HMG is the CofE, particularly in relation to housing.]
At the national level this problem dates back to the abolition of the Ministry of Public Buildings and Works. This centralised expertise amd provided a distinct career ladder for those expert in the management of such projects. Devolving this work to separate government departments led to many projects being supervised by non-specialists, often at a relatively junior level, with some other non-specialist higher up the chain of command having notional responsibility, with no one in charge actually knowing how to do the job well.