Housing a minority in £13bn PFI bail out
Only a minority of the private finance initiative projects that will benefit from a £13 billion government cash injection involve housing.
Treasury minister Yvette Cooper has announced the funding for PFI projects that are currently in the pipeline. But housing will not be a major beneficiary, as the government is between bidding rounds for housing PFI credits.
PFI projects – in which private investors take on the cost and risk of building major public works such as hospitals, schools and housing projects – will be bailed out if banks are unwilling to lend the necessary amount for an investor to go ahead.
‘These projects can therefore go ahead swiftly and support jobs and the economy and help prepare the country for the future recovery,’ Ms Cooper said.
There are some funds for housing, with council housing regeneration projects in Leeds and Lambeth among those offered support, and more housing projects could need help if the availability of credit does not improve.
Funding will initially come from unallocated funds and departmental under spends.
‘Equity investors will continue to bear the primary risk in these projects and, where available, private sector debt will continue to be provided,’ Ms Cooper added.