A council which has signed contracts worth more than £900 million under the controversial Private Finance Initiative says the ‘buy now, pay later’ scheme is “not the answer to everything”.
Wakefield Council is one of 14 local authorities around Yorkshire to have signed deals under the scheme, under which private firms fund the upfront costs of new buildings and are paid back over the next 25 years or more.
Contracts signed by town hall leaders across the region for facilities such as schools, homes and waste centres will cost the public purse more than £13bn by the time the final agreement concludes in 2042.
In Wakefield, council PFI schemes will see £907m paid to finance a street lighting scheme and a waste management site.
The street lighting contract will see £120 million paid out over 25 years, according to Treasury PFI estimates.
It was claimed when the deal with contractor Amey was signed in 2003 that 70 per cent of the lights in the district would be replaced.
The Wakefield Semi-Integrated Waste Management Project will see £790m paid over 26 years for the council’s waste processing plant in South Kirkby.
Andrew Wallhead, corporate director for regeneration and economic Growth at Wakefield Council, said: “We recognise that PFI is not the answer to everything, but it is right for some projects.
“The council’s street lighting PFI contract has meant we have benefitted from expertise to significantly upgrade the infrastructure and improve the quality of the service.
“We have also partnered in a PFI with Shanks, which has expertise in using new technology to increase recycling rates in our district and reduce the amount of waste going to landfill.”
The PFI deal was signed with a company called Shanks, which would process most of the district’s waste instead of it going to landfill under the contract.
In February this year Shanks merged with dutch firm Van Gansewinkel Groep and rebranded as Renewi.