Chunnel link may derail PFI
John Prescott and Neil Kinnock were this week trying to put the private finance initiative (PFI) back on track, after the partial derailing of the #3bn PFI high-speed Channel Tunnel Rail Link project.
London & Continental Railways, which promoted the rail link, last month said it could not deliver the scheme without more than #1bn investment from the public sector, a warning which threatens the future of the PFI project and puts a dampener on PFI as a whole. But deputy prime minister Prescott and European transport commissioner Kinnock this week co-hosted the UK European Union presidency conference on public/private partnership, bringing together 20 transport ministers plus industry leaders to discuss how PFI could deliver European transport projects.
Alistair Morton, ex-chairman of Eurotunnel, gave a keynote speech at the conference, in which he said the deal was unbalanced in terms of benefits and risks for the public and private sectors. If the deal falls through, the taxpayer is expected to shoulder more than #400m of debt.