UK politics: small differences

13/04/2015

Every man, woman and child in Britain is more than £3,400 in debt – without knowing it and without borrowing a single penny - says the Independent on Sunday. This is the £222 billion owed to banks and businesses as a result of Private Finance Initiatives (PFIs) – "buy now, pay later" agreements between the government and private companies on major projects.

The headline debt is based on "unitary charges" which start this month and will continue for 35 years. They include fees for services rendered, such as maintenance and cleaning, as well as the repayment of loans underwritten by banks and investment companies.

PFI's were the brainchild of the Conservative Party in the 1990s, but were swiftly embraced by New Labour. Successive governments signed hundreds of the deals. PFI-funded schools, streetlights, prisons, services, police stations and care homes can be found across Britain.

The system has yielded assets valued at £56.5 billion. But Britain will pay more than five times that amount under the terms of the PFIs used to create them, and in some cases be left with nothing to show for it, because the PFI agreed to is effectively a leasing agreement.

Some £88 billion has already been spent, and even if the projected cost between now and 2049/50 does not change, the total PFI bill will be in excess of £310 billion. This is more than four times the budget deficit used to justify austerity cuts to government budgets and local services.

Strangely, this will be another issue that does not make it to the top of the list in this election. But when both main parties have sticky fingers, this is hardly surprising. And there's the rub. On this and so many other things, the choice is barely worth having.

We thus make our choices not on the grand sweep of things, but on small differences. And there is one difference that matters to us. Mr Cameron has promised us a referendum on the EU. Mr Miliband hasn't.  And now, Mr Farage is telling his supporters to vote Conservative, it is that little bit closer. We could actually be looking at a referendum in 2017.