Tony Poulter, global head of project finance at PricewaterhouseCoopers, said: 'This doesn't look like an attempt to compete with the private sector. It is focused on sensible things like better early-stage project development in the public sector, and providing special funding to the private sector for specific parts of the deal.
'If this is managed sensibly it should lead to better projects, more deal flow and some perfectly sensible downward pressure on the rate of return which investors expect.'
But Charles Cox, chairman of the CBI's public procurement and efficiency committee, said the association was worried that Partnerships UK would have conflicts of interest, including seeking the best deal for the public sector while wanting finance arrangements which gave it the best return.
However, the Treasury said conflicts of interest need not arise, and Partnerships UK would invest only if both the public sector and the private financiers of the project agreed.
Its deals would be examined by the National Audit Office and the public accounts committee, it said.