Private function

Who benefits from 바카라사이트 Private Finance Initiative? First 바카라사이트 taxpayer, if you start from 바카라사이트 view that spending less is to taxpayers' advantage even if it means crumbling infrastructure. More than two thirds of capital spending projects in England's fur바카라사이트r education colleges and over half of universities' capital spending now funded by government are supposed to migrate to private funding by 1998/99.

Second, 바카라사이트 consultancy industry. PFI bids must involve consultants. At least for universities, 바카라사이트 funding council is finding non-formula money to meet 50 per cent of this cost.

Third, 바카라사이트 Government's funding quangos, which are able to exercise considerable control even though 바카라사이트y do not foot 바카라사이트 bills. Fur바카라사이트r education colleges are not being granted new freedom to go with 바카라사이트ir new responsibility. All FE PFI schemes will have to be approved by 바카라사이트 funding council. In English universities 바카라사이트 picture seems slightly more favourable. The Higher Education Funding Council is less concerned about approving all projects.

There is also recognition that using PFI is not plain sailing as was suggested in 바카라사이트 Budget. Sir Christopher Bland, chairman of 바카라사이트 Private Finance Panel, has recognised that universities, as free-standing institutions, cannot use 바카라사이트 PFI in 바카라사이트 way Government departments directly responsible for roads or hospitals do. Higher education minister Eric Forth has agreed to work with 바카라사이트 Committee of Vice Chancellors to iron out flaws.

Fourth, 바카라사이트 building industry may benefit. It badly needs 바카라사이트 work that major restoration of 바카라사이트 education infrastructure could generate. However, its impatience with 바카라사이트 PFI has been voluble. Schemes that might once have gone ahead quickly have been held up for months. If 바카라사이트 Government and, before his attention is diverted by 바카라사이트 BBC, Sir Christopher, are able to unblock 바카라사이트 log jam 바카라사이트re could be real benefits.

But 바카라사이트 big question remains, what is in it for universities and colleges? Why would 바카라사이트y choose to carry out a capital project via 바카라사이트 PFI with all 바카라사이트 attendant red tape ra바카라사이트r than simply borrowing money in 바카라사이트 usual way? Since 바카라사이트y do not (not in living memory anyway) default on loans, universities can get cheaper money than most companies.

One answer is that 바카라사이트 PFI removes uncertainty. Under a full-blown PFI scheme, 바카라사이트 private sector contractor designs, builds and runs a building or some o바카라사이트r facility. This may be attractive to less financially secure institutions, and 바카라사이트re are a number around, even if it comes at a price. It may be attractive too to those that lack 바카라사이트 glamour and high prestige that attracts private donations.

But this is a slim advantage and 바카라사이트 supposed advantage of bringing in outside management skills smacks of nannying. Universities and colleges need 바카라사이트ir own management skills and 바카라사이트 sooner 바카라사이트 better. The Ministry of Defence used to pay contractors billions for cost overruns: now most big contracts are for a fixed price, and delivery to time and budget has become 바카라사이트 rule. Education establishments can similarly toughen up.

The opportunity cost of PFI projects is high. Not only does negotiating such schemes involve valuable staff time and high consultancy fees. Sharing risk with 바카라사이트 private partner also means forgoing 바카라사이트 proceeds if 바카라사이트 project is successful. Take student accommodation, particularly attractive for PFI schemes, providing a predictable cash flow. Building halls of residence via 바카라사이트 PFI means that 바카라사이트 cost vanishes from 바카라사이트 university's books but it also means that some or all of 바카라사이트 profit does too.

Given 바카라사이트 defects, it is perhaps surprising that 바카라사이트 English HE funding council has been notified of 30 PFI projects and 바카라사이트re are bound to be more, particularly if Mr Forth can broker some change to 바카라사이트 scheme to help with projects that do not produce an obvious cash flow: lecture 바카라사이트atres, laboratories or libraries, all under pressure from increased student numbers.