Jun 20 2011

FT: over 90 UK PFI projects moved offshore

Posted by: Nick Shaxson in: Thoughts

Following my blogging on the UK’s Private Finance Initiative, the Financial Times has weighed in with some useful updates and details:

More than 90 private finance initiative projects have been moved into offshore tax havens, according to a report by the European Services Strategy Unit, a think-tank highly critical of the PFI and which maintains a database of the projects.

The FT notes UK MPs accusing PFI firms in the current inquiry of “ripping off the taxpayer” and calling the whole, tax-dodging business “a racket.” HSBC Infrastructure’s PFI deals, the newspaper notes, paid 100,000 tax on 38m in profits – tax rate of less than 0.3%.

“Ian Swales, a Liberal Democrat member of the committee, said so many deals had moved offshore “the working assumption should be that they will end up offshore.”

This is what’s increasingly happening in our globalised world. The working assumption in many sectors – particularly private equity – must be that the business is moved offshore.

And don’t forget: the banks are the biggest users of tax havens.

2 comments so far

Meg Howarth 8th August, 2011 7.41 pm

Do you have any separate data on how PFI’s been used in council-housing? In Islington, north London, PFI set up to implement government’s ‘Decent Homes’ standard: http://t.co/RmTSJmm.

Nick Shaxson 8th August, 2011 8.35 am

Meg, I don’t have any of that particular data to hand, I’m afraid. I wonder if those reports I pointed to in this and earlier blogs might be of use? The European Strategy Unit ought to have a decent handle, I think.
http://treasureislands.org/bbc-exposes-tax-scam-in-uk-private-finance-initiative/

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