PFI schemes may be pooled

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The Independent Online
THE GOVERNMENT is considering plans to pool together different projects under the private finance initiative (PFI) in an effort to speed up the development of smaller schemes.

Under the plans, local authorities will be urged to group together projects below pounds 20m in order to make them more attractive to private investors.

In a radical departure from past PFI schemes, local councils will also be allowed to put together schemes from different sectors such as hospitals, schools and roads, offering contractors the chance to bid for regeneration work in an entire area.

At present a number of small infrastructure schemes under the PFI - the Government programme to foster private-public investment - are shunned by the private sector because their small size does not justify the high cost of bidding for a PFI contract. The chief secretary to the Treasury Alan Milburn yesterday said that smaller PFI projects needed "greater strategic planning".

In his first public pronouncement since taking over the PFI brief from the disgraced Geoffrey Robinson, Mr Milburn said: "We have hundreds of potential deals but they are pretty small scale, between pounds 5m and pounds 20m, and we need to make them more attractive."