Jubilee Scotland is bringing attention back to Public Private Partnerships (PPPs) with the second stage of a campaign to bring them to an end across Scotland.
PPPs have saddled the Scottish public sector with debt, poor service, lack of accountability, and unsafe buildings since 1990 when Private Finance Infrastructures (PFIs) were introduced across the UK.
There are four key reasons why dependence on PPPs to deliver health and education infrastructure is problematic:
- They result in hidden debts being accumulated for local councils and the already limited public finances being misused.
- Service standards typically decline as taxpayers’ money is spent on assuring a profit to company shareholders rather than the best possible service for the public.
- Lack of detail surrounding PPP deals due to being protected by corporate confidentiality hinders scrutiny and accountability.
- PPPs have proven to result in unsafe and unusable buildings due to infrastructure being built with quality for the taxpayer coming second to investor profit.
The Scottish Government have produced a variety of PPP models over recent years in order to move away from the tainted PFI model, such as Non Profit Distributing (NPDs) and ‘Hubs’, however their most recent model, Mutual Investment Model (MIM) returns to many of the features from PFI. All these models rely on private financing, and are costly to the Scottish public.
In 2020, there were 80 active PFI contracts in Scotland at a value of £5.6bn; 10 more NPD projects at £1.6bn; and a further 54 projects (across 41 contracts) through hubs at a value of £1.3bn (Audit Scotland).
The capital value of assets covered by all of these current contracts is £9bn, however so far Scottish taxpayers have paid £13.1 bn up to 2018/19, and will pay a further £27bn between 2019/20 and 2047/48.
Stage one of the campaign
In 2019, Jubilee Scotland successfully completed Stage One of the ‘Scotland against PPPs’ campaign to bring a stop to PPPs, and all other models which include outsourcing to the private sector.
In the first stage, we worked with stakeholders and politicians to expose the extent of the PPP problem in Scotland and published the report “Rethinking Private Financing of Scottish Public Projects”. We met with political parties and concluded that there is cross-party support for abandoning PPPs, and so, the natural next step is to push for systemic change.
Stage two of the campaign
Stage Two in the Scotland Against Public Private Partnerships (SAPPP) campaign we will develop a feasible alternative to PPPs, secure political and public support for the alternative, and put the alternative model to the Scottish Government alongside the request that PPPs are brought to an end.
An alternative to PPP in which ownership and operation is returned to the public will have a positive impact on sustainability by facilitating project developments which meet the goal of a net zero carbon economy, as well as a positive financial impact, moving away from burdening future generations with private debt.
Ending the use of these PPP models will allow local authorities to take back control of their public assets and spend in a way which benefits local communities across Scotland.
Let’s bring public spending back to the people in Scotland and set an example for other Governments to follow.