July 31 2014 Latest news:
By Amie Keeley
Friday, May 9, 2014
»The leader of Islington Council has pledged to reform controversial and costly contracts it has agreed with big businesses.
Labour’s Richard Watts said that withdrawing from Private Finance Initiatives (PFIs) altogether would not be an option as it would cost the local authority £330million.
The schemes allow councils to borrow private capital to design, build, finance and manage public sector projects, such as housing and schools.
In return the taxpayer pays fees to PFI companies over the contract period, usually about 30 years.
Treasury figures from 2011 showed Islington had borrowed £358million from PFI schemes, which will rocket to £1.3billion – almost four times the initial outlay – by the time it is paid off in 2037.
Speaking at a grand hustings event at Islington Town Hall on Tuesday night, Cllr Watts said PFI schemes were being “properly investigated”.
He said: “The council can’t get out of the PFI contracts – it would cost £330m, so it’s not an option.
“But we are looking to work with our partners and getting them reformed.
“Given we are where we are, we need to make them better and we are looking into what legal powers we have.”
The council, under the Liberal Democrats, commissioned six PFI projects from 1998 to 2010, including street lighting, improving schools and housing.
During the event, Conservative candidate for St Peter’s ward, Oriel Hutchinson, criticised the Labour administration for failing to maintain council properties despite making £32m a year in PFI payments.
She said she knew of one woman living in a property with “toxic mould” while the companies behind the lucrative schemes “were laughing all the way to the bank”.
Council candidates from the other main political parties also spoke at the event, which was organised by the Islington Society ahead of the elections on May 22.
Liberal Democrat councillor for Highbury East, John Gilbert, said there “was not a lot to choose from the four manifestos” and it was more about “focus and attitude”.
“We are about local people and doing things for and with local people,” he said.
Green candidate Caroline Russell, standing in Highbury East, said it was time to implement policies which would have longer-term benefits to the borough.