The Financial Times provides a detailed discussion of just what PFI is, why it is appealing to governments and just how much money the British public owes on existing contracts.
Based on the recent National Audit Office report on PFI and PF2, the Financial Times reports on the economic harm done to local governments and citizens by these contracts. In one particularly disturbing example, the Liverpool City Council owes £47m in fees for a school that cost half that to build and that was only operational for 12 years.
Yet, as the NAO report states,
PFI can be attractive to government as recorded levels of debt will be lower over the short to medium term (five years ahead) even if it costs significantly more over the full term of a 25-30 year contract.