Magazine article Public Finance

PFI Projects Going Overbudget, Auditors Find

Magazine article Public Finance

PFI Projects Going Overbudget, Auditors Find

Article excerpt

More than a third of Private Finance Initiative construction projects have exceeded their budgets, according to data released by the National Audit Office.

An NAO report, The performance of PFI construction, studied building projects worth over £20m that were completed in 2008. It found that 35% were blighted by extra costs and 31% were delayed.

The October 2 report, a follow-on from a 2003 study, indicated that PFI performance had slipped in the past five years.

In 2003, the NAO found that 76% of PFI projects came in on time, and that 78% were on budget.

One contributing factor was the financial difficulties experienced by building firm Jarvis PIc. Of the projects reporting delays, 15% said they had been affected by Jarvis's problems, reporting hold-ups of up to 36 months. …

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