LibDems put bonds before PFI

27 Sep 01
The Liberal Democrats have demanded an immediate moratorium on all NHS Private Finance Initiative schemes and greater scrutiny of private sector involvement in the public services.

28 September 2001

Matthew Taylor, LibDem Treasury spokesman, attacked Labour's record on the PFI at the annual party conference in Bournemouth this week. In a debate that brought ideological divisions to the surface, he accused the government of 'fiddling' the figures. But he also insisted that the public sector should not close the door on private finance.

Delegates carried both Taylor's motion to subject PFI deals to independent evaluation and an amendment by Lord Clement-Jones to suspend NHS PFI schemes until a review is in place.

Taylor said: 'Labour have wedded themselves to PFI, whatever the cost. Unlike the other parties, we are not ideological about private finance or public service, but we are implacably opposed to secrecy, dogma and match-fixing.'

He added that projects from the Channel Tunnel to the London Underground part-privatisation 'wasted public money'.

Don Foster, the LibDem local government spokesman, told Public Finance that councils were suffering because of the government's advocacy of PFI.

He said: 'We favour a different financial regime for local government. If councils were allowed to borrow through the issue of bonds, that would enable them to have a number of financial vehicles and not force them to go cap in hand to central government or go for PFI.'

Some delegates called for PFI to be scrapped. Party executive member Baldev Sharma said: 'There is no place for the private sector in major public services whatsoever. It is the responsibility of the government to run these services and no one else.'

But Foster dismissed talk of a party rift: 'Of course we'll have delegates who will call for the renationalisation of the railways and all the rest of it but they are very much in the minority.'

The pro-private sector wing of the party was represented by Mark Oaten. The Cabinet Office spokesman did not speak in the PFI debate but urged the party to embrace the involvement of commercial interests in public services.

Speaking at a fringe meeting on September 24, Oaten said the LibDems should look 'outside the public sector' for the delivery of services, 'however uncomfortable that may be for some in the party'.


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