Cost of PFI contract revealed in Council budget papers

Telford & Wrekin Council made payments of £12,431,116 in respect of a private finance initiative (PFI) contract last year, budget papers say.

The council has a 28-year PFI contract in place for the building and servicing
of school and leisure facilities at Hadley Learning Community and Queensway for £289m.

The contract with Interserve Limited ends in 2034.

Budget papers say the inflation linked payments started off at £9,071,500 per annum in 2006.

In 2023/24 the bill came to £11,918,711 and this has risen to £12,431,116 in 2024-25.

Council officers say the council receives £5.9m per annum from the government to help offset this cost.

“The costs of the contract are being met from a combination of Government support, school contributions and council support,” say the budget papers.

“The council has approved a budget strategy which makes provision for its commitments”

PFI’s were launched in 1992 by Conservative Prime Minister John Major, and expanded by Tony Blair’s Labour government,

They were way of getting the private sector to  design, build, finance and operate a public asset and related services but some have proved controversial.

PFI contracts have delivered more 700 UK infrastructure projects across the country but are no longer used.

Hadley Learning Community was purpose built for £70m million and opened on the September 1, 2006.

Interserve (now Mitie FM) provides all HLC facilities management on site and work closely with it to maintain the environment for students, staff and community, says the school’s website.