Monday, Feb 16, 2009
Another bail-out on the way
BBC News: PFI 'may need government funds'
PFI's were supposed to be an off-balance sheet way for the government to raise money for schools 'n' hospitals. It seems now that the private sector is not prepared to fund government projects, to the tune of £4bn...
Posted by iblewitlasttime @ 09:28 AM (519 views) Add Comment
6 Comments
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1. paul said...
And now, all of a sudden, the rationale for quantitative easing becomes clear ... the government has to bail itself out by printing more money. In other words, just like Zimbabwe.
2. stillthinking said...
As well known by now, PFI had just one goal and that was to keep government debt down. For private companies to borrow funds on the basis that their repayments were lower than their due from government begs the question why on earth didn't government take advantage of cheap funding?
Now the government seems to be in the even more strange position of arranging their own loans via third party.
3. tyrellcorporation said...
Paul, my thoughts exactly. Plenty of spin already about the benefits of QE (printing) but lets be in no doubt, the only people who are going to benefit (short term) are the government. As 'short term' is what GB is about, expect QE to go ballistic and it'll be spun that it's 'all good' as it helps our beleaguered export market by destroying the Pound - um...sorry, making the Pound more competitive.
4. Orcusmaximus said...
@stillthinking - "As well known by now, PFI had just one goal and that was to keep government debt down. For private companies to borrow funds on the basis that their repayments were lower than their due from government begs the question why on earth didn't government take advantage of cheap funding?"
Er, no. PFI had one goal, and that was to hide government debt off the balance sheet. Which pretty much answers your question.
5. mark wadsworth said...
This is a triumph for off-off-balance sheet funding.
6. alan said...
They can't all have funds.
Does Gordo have a Plan B ?