Friday, 21 June 2013

Union hits out at high cost of private financing for Scottish transport projects

21 June 2013
UNISON today (Friday) welcomed the call from Audit Scotland for greater transparency on the costs of five key transport projects.

The public services union said it was clearly wrong that the full public sector financial commitment for the projects has not been reported before now and condemned the continued use of expensive PFI/PPP through so-called Non Profit Distributing (NPD) financing.

Audit Scotland warned that the total estimated spending commitment over 30 years is £7.5 billion but that the Scottish Government “has not fully demonstrated the reliability” of its analysis that this is affordable.

Dave Watson, Head of Bargaining and Campaigns, said: “Two of these road projects use NPD, while the Borders Rail project failed as an NPD scheme.

“We have long warned about the high costs and lack of transparency about PFI/PPP. It is mortgaging future generations to the hilt at greater cost than conventional financing.

“Today’s report warns about inconsistencies and inherent uncertainties in the way costs are estimated. UNISON is concerned that Full Business Cases, which should in theory allow assessment of potential costs and any service delivery issues, are not produced early enough. Pressure to deliver the project overwhelms the need for adequate financial scrutiny.

“For Audit Scotland to say that the Transport Scotland and Scottish Government reports on infrastructure spending don’t provide any information about the estimated long-term budgetary commitments arising under revenue-financed projects is pretty damning.”

UNISON has warned about the difficulties of assessing costs of PPP schemes as these are often deemed ‘commercially sensitive’.

Dave added: “The report notes that due to commercial sensitivity we don’t yet have public reporting of the 30 year costs for the NPD schemes. However, we welcome Audit Scotland confirming* that the costs should not be commercially sensitive once contracts are in place, as this has frequently been challenged when Freedom of Information requests are made.

“We look forward to full details being published as soon as possible after that.”

* (Par 103)





Note to editors:

1. UNISON’s briefing on PFI/PPP projects in Scotland is online at


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