John McDonnell vows to end PFI ‘scandal’ by bringing all contracts into public sector
All Private Finance Initiative contracts will be brought back into the public sector if Labour wins the next election, John McDonnell has declared.
The Shadow Chancellor said he wanted to end the “scandal” of private firms making huge profits on the back of deals to build hospitals and schools.
Under PFI, privately-run consortiums agree to build major public construction projects, with taxpayers picking up the repayment bill.
In his speech the Labour conference, Mr McDonnell said that “over the next few decades, nearly two hundred billion is scheduled to be paid out of public sector budgets in PFI deals”.
He said that in the NHS alone, £831m in pre-tax profits have been made by private firms involved in PFI contracts.
The Shadow Chancellor said Labour had already pledged not to sign any new PFI deals if it comes to power at the next election.
And he added: “We will go further. I can tell you today, it’s what you’ve been calling for. We’ll bring existing PFI contracts back in-house.”
It is unclear how much the policy would cost, but it is likely to run into the tens of billions at the very least.
Shadow Treasury Secretary Peter Dowd told the BBC’s Daily Politics that the policy would be “pretty self-financing”.
Mr McDonnell’s vow came just hours after he revealed plans to renationalise the Royal Mail, water industry, railways and energy sector – with Labour ministers setting the price.
Elsewhere in his speech, the Shadow Chancellor said the next Labour government was “in sight” and its performance will be “will be measured by the care we show to all our people and the richness of their lives”.
He added: “We proved in the election, and we will now go on to prove in government, our belief that hope will always overcome fear, kindness and generosity will always overcome greedy self-interest and that the flame of solidarity in our society will never be extinguished.
“For years we have proclaimed that “Another World is Possible.” I tell you now, that world is not just possible, it is in sight. Let’s create it together.”