The current UK deficit is fairly substantial. A new argument on the scale of the deficit has opened up. A substantial amount of government spending over the past 16 years has been through part privatisation and concessions. The primary instrument was PFI. For most of capital expenditure over this time PFI was the only game in town. It now seems that this debt is to be reflected in the current deficit calculations and will almost double the deficit. These debts are normally seen as off balance sheet debts but now seem to be included as part of the deficit calculations. Is this another excuse for cuts?
PFI was always about mortgaging the future. Why did we not go down the pure privatisation route? It would have had a lower government risk. Did the banks and financiers get rich from PFI? Very interesting times.
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