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UK authorities step in to save PFI projects

Private Financial Initiative (PFI), once the flagship of the UK government's investment policy going forward is this evening standing on the edge of a precipice. The UK authorities have been forced to inject between £1 billion and £2 billion into the PFI sector as the vast array of banks which offered funding in the early days have disappeared and withdrawn their credit lines. This has left over 100 multi-million pound (and in many cases multibillion pound) projects in limbo and forced the UK government to step in with additional taxpayer funding.

Any delay in the funding of these projects will see school developments delayed, transport projects put on hold and an array of public sector projects under serious threat. Just days ago there were suggestions that many of the PFI construction companies who partnered with the government were in serious financial trouble. This has forced the government to set up a kind of "infrastructure bank" which will be used to ensure no public projects are delayed or cancelled.

While PFI may not have received many headlines over the last few days this is a serious issue for the UK authorities and one which is going to literally eat up billions upon billions of pounds of taxpayer's money.

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