Question to the HM Treasury:

To ask Her Majesty’s Government whether in assessing the benefits of PFI against conventional procurement they take account of the amount of UK tax paid by PFI investors, as recommended by the Public Accounts Committee in its report of 2011 <i>Lessons from PFI and other projects</i>.

In its response to the Public Accounts Committee report, the Government made clear that it did not agree with the Committee’s conclusion and recommendation.

As set out in the response, HM Treasury stated that the initial appraisal of a project takes into account the additional tax receipts that arise from the use of a privately funded project, compared to a publicly funded project.

Managing Public Money directs procuring authorities to ensure that procurement decisions do not rely on any tax advantage that a particular bid may enjoy because of the tax status of the proposed contactor. Any privately financed option will only be pursued if it is better value for money than the publicly funded alternative.

The Treasury’s full response can be found on the gov.uk website.