07 April 2000
Sarah Wood, director of finance and performance review at Birmingham City Council, said she had 'reservations' about the figures supporting a local Private Finance Initiative project to rebuild seven schools and refurbish a further three.
'Of course, publicly I've got to say that it is value for money. Privately, I am not sure,' she told delegates at the CIPFA Scottish branch conference in Crieff on April 5. 'But it is the only game in town. It is the way you do get money into your services.'
The project has been assessed as having a net present value of £78m and involving PFI credits of £50.6m. Its public sector comparator is £83.5m.
Wood said that local authorities would struggle to run successful PFI schemes without additional financial incentives. She compared Birmingham's situation with that of Glasgow which, according to financial services director George Black, had made 'not insignificant' savings by closing ten schools in advance of its own PFI project.
'How many PFI schemes can a local authority take on if you don't have the luxury of having closed ten schools and having the money in the bank?' she said.
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