Please forward interest (PFI)

Desperate times call for desperate measures, they say, and judging by Tory MP Jesse Norman’s recent pronouncements, the time has come for contractors that have participated in the UK’s private finance initiative (PFI) to help the country get back on its feet.

In a recent opinion article in the Financial Times, Norman expounded on the benefits of a PFI rebate, which would see the private sector reduce the interest payments they receive from public institutions by between 0.02 percent and 0.03 percent per year, a move that could save the public purse between £500 million and £1 billion.

The obvious problem, as Norman recognises, is that these payments are regulated by contracts that can’t just be torn up. So the solution would be to make the rebate voluntary.And by voluntary, he means the “’l’ll make you an offer you can’t refuse” type of voluntarism.

In essence, Norman is calling for the government to gently remind PFI contractors just how much they depend on public institutions to make a living, as “encouragement” to “push [for] fairer treatment”.

After all, “the idea that our public services are getting a bad deal here is gaining momentum,” he warns. And bad deals in times of austerity tend to open the door for all sorts of government intervention.