Inquiry shows Defra handling PFI funding „poorly“

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House of Parliament (Foto: ©Michael Löffler /http://www.pixelio.de)

London — An inquiry into the Department for Environment, Food and Rural Affairs’ (Defra) handling of three private finance initiative (PFI) waste projects has found that the government department „failed to exercise good judgement“. The findings can be found in „The Department for Environment, Food and Rural Affairs: oversight of three PFI waste projects“ report, published by the House of Commons` Committee of Public Accounts.

The Department for Environment, Food and Rural Affairs (the Department) is responsible for ensuring that the national portfolio of projects is sufficient to reduce the amount of waste sent to landfill to meet the EU target. The Department provides grants to some local authorities using the Private Finance Initiative (PFI) to build new waste management infrastructure. However the Department does not accept responsibility for projects delivered by local authorities to meet the national targets for which the Department is responsible.

PFI contracts typically last for 25-30 years and this does not offer the necessary
flexibility to respond to rapidly changing technology and changing policy equirements for waste disposal. Furthermore, the Department has been unacceptably slow to intervene in projects that are struggling to deliver the required waste management infrastructure leading to delays and incurring extra costs.

The Department’s handling of the Norfolk PFI waste project has been particularly poor with the Department failing to exercise good judgement by agreeing to give funding to the project and then failing to give sufficient consideration to the local impact of its decision to withdraw funding to that project. This contributed to the contract being cancelled which has left Norfolk taxpayers facing a bill of some £33.7 million.

The full report can be found under parliament.uk.

Source: Committee of Public Accounts