Manchester University Press
6 Follow the money
Abstract
This chapter turns to the bottom line of outsourced regeneration and self-regulation – the colossal financial riches made. The chapter follows the money from government to the immediate companies and then through to their ultimate owners, often offshored in tax havens. A first section recaps on the variety of unnecessary costs imposed on the public sector through PFI procurement that would simply not arise if the schemes were financed and procured directly through the public sector. A second section focuses on the complex yet lucrative financial deals done to raise the upfront investment that provide private banks, financial market traders and PFI investors with enormous, risk-free profits. The chapter then turns to the generous profit margins commanded by the construction and maintenance firms in these PFI schemes from the lack of genuine competition in the procurement process. It goes on to detail how corporate consultants and the ‘big four’ accountancy firms also financially benefit from advising on and auditing these schemes in ways that create real conflicts of interest. A final section follows these different profitable financial flows through the MFN regeneration scheme.
Abstract
This chapter turns to the bottom line of outsourced regeneration and self-regulation – the colossal financial riches made. The chapter follows the money from government to the immediate companies and then through to their ultimate owners, often offshored in tax havens. A first section recaps on the variety of unnecessary costs imposed on the public sector through PFI procurement that would simply not arise if the schemes were financed and procured directly through the public sector. A second section focuses on the complex yet lucrative financial deals done to raise the upfront investment that provide private banks, financial market traders and PFI investors with enormous, risk-free profits. The chapter then turns to the generous profit margins commanded by the construction and maintenance firms in these PFI schemes from the lack of genuine competition in the procurement process. It goes on to detail how corporate consultants and the ‘big four’ accountancy firms also financially benefit from advising on and auditing these schemes in ways that create real conflicts of interest. A final section follows these different profitable financial flows through the MFN regeneration scheme.
Chapters in this book
- Front matter i
- Dedication v
- Contents vii
- List of boxes, figures and tables ix
- Acknowledgements xi
- List of abbreviations xiii
- Introduction 1
- 1 Privatisation and the death of public housing 19
- 2 Outsourcing on steroids 56
- 3 Partners for improvement? Corporate vandalism inIslington and Camden 93
- 4 Not fit for purpose 121
- 5 The accountability vacuum 159
- 6 Follow the money 191
- 7 After Grenfell 227
- Appendix. List of formal interviews cited in the book 245
- Index 247
Chapters in this book
- Front matter i
- Dedication v
- Contents vii
- List of boxes, figures and tables ix
- Acknowledgements xi
- List of abbreviations xiii
- Introduction 1
- 1 Privatisation and the death of public housing 19
- 2 Outsourcing on steroids 56
- 3 Partners for improvement? Corporate vandalism inIslington and Camden 93
- 4 Not fit for purpose 121
- 5 The accountability vacuum 159
- 6 Follow the money 191
- 7 After Grenfell 227
- Appendix. List of formal interviews cited in the book 245
- Index 247
