According to media reports a PFI contract, one of 10 new deals to be agreed in the Yorkshire region over the coming year, is the largest ever seen in the area, despite widespread criticism of the initiative.
Sheffield City Council is currently in the final stages of agreeing a radical £2bn PFI contract to take place over the next 25 years, which will see a private firm take control of the city’s entire network of streets and highways.
Under the terms of the deal due to be signed early next year the winning bidder will be responsible for the renovation of Sheffield’s notoriously pot-holed roads and then maintain them at that level for the duration of the six year contract.
All aspects of the council’s highways department’s role will be handed to the private firm, from sweeping the streets to emptying litter bins and repairing benches and street signs.
The council has secured £1.2bn in PFI ‘credits’ from the Government – effectively a huge grant – towards the project, meaning the deal has been widely welcomed in a city.
With actual public works representing only one aspect of the overall deal, Mr Micheal Platt, the councils project director suggested it may prove better value for money than other construction-only projects, where the cost of private-sector borrowing has meant schemes end up costing far more than if they had remained in the public sector.
He said: “There is a transfer of risk here which is a major benefit to ourselves.”