THE EXTENT of the full-scale looting of the country’s public buildings by giant offshore private companies has been highlighted in a report by a think tank that investigates Private Finance Initiative (PFI) deals.
The report by the European Services Strategy Unit reveals that nine offshore investment funds own between 50% and 100% of the equity in 335 PFI projects; currently there are 735 such PFI schemes in the country.
A further 12 offshore companies have bought shares in 74% of these 735 schemes. This means they own between 50% and 100% of these public assets, mainly schools and hospitals, making huge profits out of them.
Five of these companies specialising in lending money through PFI, made a profit of nearly £2 billion, which owing to their offshore status they paid no corporation tax. The head of the Strategy Unit, Dexter Whitfield, said: ‘PFI is essentially a private sector profit machine. If the government adopted a strategy of building the public infrastructure directly through public investment and operating it through their in-house services this whole edifice would not exist.’
He added: ‘All these transactions are a product of the fact that there is so much money to be made in PFI.’ PFI was invented by the Tory government in the 1990s and massively expanded by the Blair/Brown Labour government.
It opened the door for the international speculators to buy up hospitals, schools and any other public buildings they could lay their hands on as the Tory-led coalition and the last Tory government attempted to bring down the country’s massive national debt, standing at £1.8 trillion and rising, by selling off public land and assets.
In this process, schools and hospitals are landed with huge and crippling debts, even just repaying the interest on these ‘loans’ for rebuilding. University College London Hospital’s Trust reported it was paying between 7% and 8% on its PFI debt, an annual bill of £30 million – money that should be spent on patient care, nurses and treatment.
Now these speculators are moving in with a vengeance to buy up the public land these hospitals and schools stand on, bulldoze them out of existence and build houses or shopping malls that will return vast profits. The basis for this ‘fire sale’ of public land and buildings was laid in the Naylor Report published earlier this year. Commissioned by the Tories, the report called for £2 billion of NHS land to be sold off for house building.
This much-delayed first report by Naylor has now been followed by a second which looks at the riches to be made by selling off public assets in London, the big prize for the speculators with its massive property prices and land values.
Although this second report hasn’t been published by the government yet, a presentation by Sir Robert Naylor last month gave a clear indication of what it contains. According to senior staff writer at the BMA, Peter Blackburn, who was at the presentation, while constantly denying there was to be a ‘fire sale’ Naylor made it clear that the five top STPs (sustainability and transformation plans) for having their land sold off and buildings demolished, are all in London.
Blackburn reports that: ‘Simon Corben, NHS Improvement’s director of NHS estates and facilities, echoed the suggestion that London’s estates could make a lot of money – and said Project Phoenix, a national NHS initiative to bring private firms to the table, could be a big part of the future.’
The intention of the Tories is clear – sell off NHS land, close down hospitals and flog the lot off to the overseas speculators and use the billions made to pay off the debts of the bankers. With the NHS bankrupted and reduced to a handful of buildings in London the Tories will move to the ultimate goal of the complete privatisation and destruction of the NHS.
The only way that the NHS and every other public service can be kept from the profit-hungry speculators is to kick out the Tories through the organisation of a general strike and go forward to a workers government that will expropriate the banks and speculators as part of a planned socialist economy.
