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Explained: How PFI works

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The PFI sees the design, construction, maintenance and operation of key public infrastructure, such as roads and hospitals, passed over to the private sector for typically 25 to 30 years.

The private sector stumps up the cash to pay for the services.

The government then pays it back over the length of the contract with the PFI consortia keeping any profits that they make over the lifetime of their involvement.

Banks lend to consortiums, which usually include a construction company, architect and facility operator, which use bank funding to pay for the project.

See also

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