Welsh Tax Payers Service Gordons' £161bn PFI Debt!
A statistic which passed almost unnoticed in the Chancellor's pre-Budget statement last week was that the Private Finance Initiative (PFI) Debt has now reached a staggering £161bn, up £13bn in just one year. That means that Gordon Brown has had to set aside an extra £13bn in one year alone to service this debt, a figure which is only £1bn less than the entire budget for Wales!
This should concern us all very deeply in Wales. There have been very few PFI projects in Wales because, wisely, local authorities have preferred only to use the money they have rather than mortgage their budgets for decades to come. Now however there is a squeeze on the capital provision for local authorities (Powys County Council will be at least £12m short of its requirements next year) and there are endless calls for "efficiency savings" whatever that may mean in schools and old people's homes. We are constantly being told that there is "no more money in the pot" for education and social services, yet clearly there is £13bn to service the PFI debt in 2006 - 07 as well as £25bn for Trident and £70bn de-commissioning costs for the new generation of nuclear power stations Blair is so keen on.
Is now clear that we, as Welsh tax-payers, are mortgaging our own futures since it is partly our taxes which are going to service this £161bn debt, nearly all of it used for schemes outside Wales. If Welsh authoriites prefer not to use PFI there should surely be a sizeable uplift in their dirtect grant since they are, effectively, saving Gordon Brown billions of pounds a year.