PPP is now the only game in town

13 Apr 00
Scotland's largest public-private partnership scheme to rebuild Glasgow's secondary schools would not have been affordable without additional government funding, the city's finance director told the Scottish CIPFA branch conference.

14 April 2000

George Black, Glasgow's director of financial services, said that the Level Playing Field Support grant from the Scottish Executive had been a key factor in justifying the scheme. The £200m project involves building 12 new schools and refurbishing a further 17.

Glasgow is receiving £13.8m a year in support from the Scottish Executive as part of the second wave of PPP schemes in Scotland. But this funding will not be available for future projects.

'If PPPs are to continue to flourish, I would argue that Level Playing Field Support or some other form of financial incentive is required to help quality projects become affordable,' he said.

Black said there was little alternative to the PPP route. It had been calculated to be 5% cheaper than the whole-life costs of traditional investment.

'I see no indication that the large-scale capital allocations that have been talked about are just over the horizon for local authorities. I have to look for options that are alive here and now.'

Black's views were echoed by Sarah Wood, director of finance and performance review at Birmingham City Council, who said that PPP was 'the only game in town'. However, she admitted that she still had reservations about whether it really represented value for money.

'It wouldn't surprise me if in five or ten years' time, George and I are stood before an Audit Committee somewhere being asked: "Why did you do that?",' she said.


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