18 May 2007
If the Treasury will not seize a proportion of the profits made from sales of Private Finance Initiative shares it must act to stop uncompetitive monopolies, MPs have said.
The Commons Public Accounts Committee's May 15 report, Update on PFI debt refinancing and the PFI equity market, follows calls from some Labour MPs for profits from PFI share sales to be split with the public sector. The PAC did not heed them, but said the Treasury should closely monitor the situation.
'There is no requirement for the gains made by investors through selling on their shares in PFI projects to be shared with the government,' said committee chair Edward Leigh.
'The Treasury must keep the working of the PFI equity market under close scrutiny to make sure the public interest is not being compromised.'
The PAC fears that although a 'secondary market' in PFI equity could bring down costs — as investors know they can sell on their shares — the equity market has shown signs of consolidation, increasing the risk of market monopoly.
PFmay2007
