Wednesday, 4 March 2009

From the Record - PFI

Yesterdays news led me to ask this in the Assembly:

Leanne Wood: We are all acutely aware of the current economic conditions and that the situation is likely to get worse before it gets better. The Westminster Government has committed billions of pounds of public money to bailing out the banks, and that money will have to come from somewhere. It seems likely that the bailouts will be paid for, in the long term, by cuts to front-line public services.
We heard in the news today that the Westminster Government intends to provide further billions of pounds to bail out failed and failing private finance initiative schemes. Is it not ironic that public funds are now needed to save private finance initiative schemes? The Welsh Assembly Government is to be commended on its cautious approach to PFI. As times get more difficult, the wisdom of the decision not to embrace the idea of the private sector running public services will become more apparent. However, this Government’s past prudence could work against us in terms of the PFI bailout unless we get our share of any money that becomes available. Will we get our Barnett share of this bailout so that we, too, can build new schools and hospitals?
We also need to be aware that all of this will have an impact on what was meant to be the biggest PFI scheme in the whole of Europe, namely the proposed military training academy at St Athan. The estimated cost of that scheme has already crept up from £11 billion to £12 billion. The project has already lost its lead partner and has since acquired a new partner in the form of a French catering company—

The Presiding Officer: Order. This is not a debate about defence or anything else. This is about the business statement. I would like a question.

Leanne Wood: Thank you, Presiding Officer. Do you agree that PFI is fiscally dangerous, that the Government is under contract to pay for services under PFI—

The Presiding Officer: Order. This is not a debate about PFI. However, if you would like to ask the Leader of the House whether he will organise a debate in which you can raise these issues, that would be quite in order.

Leanne Wood: I am coming to that, Presiding Officer.

The Presiding Officer: Well, it is taking some time. [Laughter.]

Leanne Wood: I would be grateful, Leader of the House, if you could find time for this Assembly to discuss the implications of this latest Westminster bailout. We need to know whether there will be a Barnett consequential for Wales and whether the precarious nature of PFI projects in this economic climate raises questions about the planned development at St Athan.

Carwyn Jones: The Government supports the defence training academy. That project will bring many jobs to the Vale of Glamorgan and surrounding areas. It is the Government’s hope that that project continues to move forward.
The banks are a matter for the UK Government and, indeed, Governments around the world. Despite the imprudence and incompetence of so many banks, it nevertheless remains the case that the banking system must be kept afloat. The hope is that all the shares in the banks that the Government has bought over the past year or so will eventually be sold at little or no cost to the taxpayer. However, I suspect that that time is not at hand, if I may put it in that way.
On the need to debate these issues, the First Minister is able to answer Assembly questions as they come. I know that he will have made his points clearly this week in the meeting of the various First Ministers of the UK’s devolved institutions and the Prime Minster that we wish to ensure that the Welsh budget is protected.

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