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PFI RECEIVES ASSURANCE ON PROJECT FUNDS

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The treasury's private finance initiative taskforce yesterday provided a written assurance that funding for PFI pro...
The treasury's private finance initiative taskforce yesterday provided a written assurance that funding for PFI projects would be guaranteed once contracts had been signed. The Financial Times (p13) reports that the taskforce also attempted to resolve a dispute within the accountancy profession over how PFI projects should be treated in the public accounts.

The taskforce said moves were also in hand to streamline its relationship with 4Ps, the public-private partnership programme. At present, 29 'pathfinder' projects are in the pipeline; these are designed to test and develop PFI principles across a range of local government services. The taskforce will sign off projects it judges to be of good quality, and offer its expertise on those judged 'significant' - a label yet to be defined. Its endorsement will be needed for local authorities to obtain government support.

Charles Cox, the chairman of the Confederation of British Industry's public procurement and efficiency committee, is quoted warning government departments that they must act now 'to avoid a hiatus in PFI while they carry out comprehensive spending reviews over the coming year'. The issue of whether a PFI project, or parts of it, should count against the public sector borrowing requirement is only likely to be resolved when the Accounting Standards Board publishes its formal view.
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