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Motion · S6M-16287 · 29 Jan 2025

The Ongoing Impact of PFI/PPP on Scotland’s Public Finances

Lodged by Kenneth Gibson (No Party Affiliation) Members' Business Motion 27 supporters

The motion

That the Parliament believes that the total unitary charge payments associated with Public Private Partnership/Private Finance Initiative (PPP/PFI) contracts that were paid across the public sector in Scotland from 2006-07 to 2022-23 amounted to £14.173 billion; understands that PFI/PPPs are long-term contractual arrangements between a public sector entity and a private sector provider, which were introduced by the Conservative UK administration in 1992 and then expanded by Labour following its 1997 election victory; believes that the total PFI and PPP unitary charge payments to be paid across the public sector in Scotland in 2025-26 will be £1.25 billion, the highest in a single year, with the remaining cost associated with PFI/PPP being £14.699 billion from 2023-24; understands that, by 2038, North Ayrshire Council will have paid £440.1 million for four schools that were built for £83 million; notes that research carried out by the National Institute of Economic and Social Research shows that successive UK administrations have made payments to private companies associated with PFI contracts at, on average, more than three times the cost of construction, with said companies distributing £300 million in dividends to investors from £1 billion in profits between 2005 and 2022; recognises that the scheme was abandoned by the UK Government in 2018, 11 years after being replaced with an alternative model known as non-profit distributing (NPD) by the Scottish Government to limit excessive private sector profits; notes with concern media reports that the Chancellor of the Exchequer, Rachel Reeves MP, is considering relaunching the PPP funding model frequently used by Tony Blair’s Labour administration; considers PFI/PPP to have had a disastrous impact on Scotland’s public finances, and notes the calls for the UK Government to end what it sees as its obsession with PFI/PPP. 

Supporters (27)

Source: the Scottish Parliament motions and amendments record.