Treasury in charm offensive over PFI

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The Independent Online

Chancellor Gordon Brown is preparing to launch a PR campaign on the controversial Private Finance Initiative (PFI) to stave off criticism that it represents poor value for money for the taxpayer.

The Treasury is understood to have commissioned consultants Mott MacDonald to cost PFI schemes against traditional public procurement.

The report is not expected to be made public for at least a month but Whitehall sources say it will show that when all costs are accounted for, PFI schemes work out cheaper. One of the most comprehensive evaluations of the PFI process ever undertaken, the report will cost the extra tax benefits the Treasury receives by ceding control of public services to private companies.

The Government has come under sustained attack from the unions for what they view as the blatant privatisation of public services. Last Monday union members were plotting a major assault on PFI at the TUC assembly in Brighton. But that and other speeches were postponed after the terrorist attacks in America.

One senior union source said: "The issue will not go away. We'll keep banging the drum. Our members will strike if the Government continues with creeping privatisation of schools and hospitals."

But supporters of the PFI hope the report will quell unrest. One government source said: "[The report] should re- move some bitchiness on hospitals and PFI cost savings. The Treasury needs to make sure it is getting good value for money."