With 17 PFI schools built by Miller Construction closed this week for safety inspections, as the PFI contractor “Edinburgh Schools Partnership” cannot guarantee their safety after a wall collapsed at one of the schools, this is just the tip of a PFI nightmare for Scotland.
Better Together have between them landed Scotland with a £22 billion PFI debt mountain - with SNP contributing too - that we will need to pay £1.2billion a year to clear - this alone - from our £30 billion annual budget.
And it’s about to get a whole lot worse with the Guardian reporting Hollyrood could have a £50 billion debt by 2020.
The SNP party have privatised control of all infrastructure decisions across the whole of Scotland, effectively turning Scotland into a PFI monopoly board by carving Scotland into five private PFI territories, controlled by mainly English based consortiums with hugely complex ownership structures in Ireland, Luxenbourg and J.P. Morgan bank in America.
An unelected quango, the Scottish Futures Trust, was created to “oversee” this set up, with the board controlled by people who made their living from consulting and advising on the £22 billion Scottish PFI debt mountain we already have.
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In 2012 there were 20 directors on the Scottish Futures Trust board who shared a £1.92 million a year pay pot between them, before pensions and bonuses are included.
They say “the Scottish Government should consider developing the role of the Scottish Futures Trust, further, to establish a centre of expertise in the ownership, management and disposal of public assets” across Scotland.
The CEO of the Scottish Futures Trust, Barry White, is a former army Major and Morrison Construction man, who left the construction company in 2001 and became a director of "two of the industry’s most prolific "public private partnership (PPP) companies".
In 2009 Barry White said in an interview "PFI could still be used north of the border" four months after the SNP government appointed him to be CEO of their Scottish Futures Trust that was meant to replace PFI.
Barry White, whom no one has elected said councils would not be stopped taking on PFI either.
And now we understand why Barry White wanted PFI to remain - as his LinkedIn profile reveals he has was appointed to the board of “Scottish Roads Partnership” in February 2014.
This is the same “consortium” awarded a PFI contract 6 months earlier to upgrade the motorway network in Central Scotland which the Scottish government told the public would cost £415m but in fact, the real cost is £1.391 billion.
Surely this is a breach of anti corruption laws and a clear cut conflict of interest when the CEO of the board meant to regulate the SNP's initial £9 billion extra PFI debt for SNP has been given a seat on the board of a company that has just won a PFI contract under his supervision.
Is this a case of you scratch my back and I'll scratch yours?
Another three members of the main board of directors, Peter Reekie, Christa Reekie and Tony Rose all previoulsy made their living as “consultants” on the existing £22 billion PFI mountain of debt and directorships on other "public" boards are mounting fast.
As well as being on the board of the SFT Tony Rose has recently been appointed to the board of public company Lothian Buses.
Christa Reekie is on the board of governors for the Glasgow School of Art and is now also the “Chief Exectuive of the new “charity” Local Affordable Rent Housing Trust. (LAR)
This “charity” was set up by the Scottish Future Trust board – with Alex Neil giving his PFI board a loan of £55 million of taxpayers money to set up their own “charity” where they used their position of power to appoint themselves to the board.
This "charity", they say, has been set up to rent out “affordable homes” – at the same time SNP government has slashed housing association funding across Scotland.
Irvine Housing Association, in the SNP Housing Minister’s own constituency, was told by the government there was no money available for homes and the Housing Association visited every tenant in their home to advise them the only way they could raise funds for housing was to merge with Riverside Housing Association in Liverpool and get money from them now instead - I know because I'm one of those tenants.
And now all the tenants in this former Scottish controlled housing association, in the SNP’s Housing Minister’s own constituency are now forced to phone Liverpool to pay their rent or get repairs.
And what sort of “charity” is this as Christa Reekie says “The LAR is backed with a £55million government loan and is expected to raise an overall funding package of over £100million through private sector investment”?
SNP are putting into place Cameron’s big society plan to take us back to the Victorian era and replace accountable housing associations, democracy and councils controlled by elected councillors with unaccountable “charities” to be controlled by the unelected "Scottish Elite" with the CEO of the Scottish Futures Trust appointing himself to this charity board too along with fellow Scottish Futures "Trust" board member Christa Reekie.
And the SNP and Scottish Futures Trust have set up a PFI variant for all those “affordable homes” that Scotland’s people don’t realise are not as affordable or as public as they are led to believe under the National Housing Trust set up by SNP in which the PFI Scottish Futures Trust is involved too.
Are all these "Trusts" set up by the SNP government a complete breach of trust of every single person who voted for them at every election and referendum since 2007?
Despite the SNP government promising to cancel PFI in Scotland here is how the new PFI scheme for the whole of Scotland has been set up.
Each of the five new private PFI “Hub Territories shown on the monopoly board on the left, is controlled by a new private Hub Company set up by the SNP government where each has a complete monopoly for 10 years and can award the "private consortium" members PFI contracts.
Each company is a public/private “partnership” where the private sector consortium controls 60%, the Scottish Futures Trust board controls 12.5% and a host of councils, NHS trusts, police, fire service and even court service bodies only control 2.5% each (30% between them)
The unelected CEO of the Scottish Futures Trust" - ensuring Scotland has no future but £9 billion MORE PFI debt via public bodies in each of the five Hub Territories- with each public body only holing 2.5% of the decision making power - effectively no power.
This ensures the private PFI consortium companies and the government's quango have complete control, for 10 years, of each "Hub Territoriy" on the above PFI monopoly board that used to be Scotland, with all the power to award themselves PFI contracts for any construction projects for every council, NHS Trust, Police, Fire Service and Court Services construction projects under their monopoly control in their hub “territory”
This will then be used by the SNP government to say "it is not us it is the councillors that forced the PFI debt on you - when in fact the Scottish government and their PFI friends have all the power in their hands and it is them that is forcing all of this PFI debt on Scotland.
Hub South West Scotland are already using their monopoly position to their advantage and in December 2015 Graham Construction (who is part of the PFI consortium that controls the Hub Territory, told councillors in the borders they were increasing the cost taxpayers must pay to refurbish schools by nearlly 50%, from £45 million to what could be MORE than £66 million, (at least £21million more than agreed) after “plans for a "super school" for all the town's S4 to S6 pupils were dropped.
To find the extra, at least, £21 million councillors “were told they can reduce spending on other projects or borrow more money or reassess the schools project itself”.
Was this to punish the council with only 2.5% of the power for dropping the super school plan that would have made a PFI fortune for the private companies controlling the new PFI Hub Territory in which the council finds itself ?
Galliford Try’s CEO boasted the company no longer has to worry about democracy or elections and as a result their profits and their profit margins are through the roof – with a report in February 2016 saying their profits are up by 24% - this after they rose by 20% in 2015 - with PFI hubs securing their future profits keep on rising with their monopoly position. (graphic Interactive Investor "Housebuilders extend post election rally)
This graphic for Hub South West Scotland (from the company check website) shows how each hub company is set up. The large blue section represents the private consortium that controls 60%. The remaining 40% is controlled by -
The Scottish Futures Trust (12.5%) and
Councils: Dumfries and Galloway, North South and East Ayrshire and North Lanarkshire councils (2.5% each)
NHS Boards: Dumfries & Galloway, Ayrshire & Arran, Lanarkshire Health Boards (2.5% each)
Courts: The Scottish Court Service (2.5%)
Fire Service: Strathclyde Fire Board (2.5%)
Irvine Bay Development Ltd (2.5%)
The consortium with 60% control of Hub South West Scotland is called Allied Community Partnership Ltd.
Allied Community Partnership consortium is 70% controlled by London based company Equitix via its Equitix Sw Hubco Ltd investment company.
Three construction companies control 10%, each via holding companies, English construction companies Galliford Try and Kier Construction along with Northern Irish company John Graham Construction.
Equitix and Kier Contruction and Graham construction (who control the PFI hub in South West Scotland) are getting the same sort of PFI “consortium” deals across England and Wales as well as Scotland – where the whole of the UK in now just one big giant PFI monopoly board for a handful of PFI profiteers and construction companies to fleece taxpayers for 30 years.
With Galliford Try saying in their annual report in 2011 their profits had increased 80% and "the company said that it had secured partner status on the Homes and Communities Agency’s 2011 to 2015 framework and had been awarded £3 million for the delivery of 200 homes under the FirstBuy scheme."
It's not just the Westminster parliament giving Galliford Try "partner status" as the SNP government is doing the same - giving Galliford try a near 60% monopoly of Scotland.
Hub South East Scotland Ltd is in control of what sounds like a Scottish private consortium - Space Scotland Ltd
But it is in fact 3 English companies in control - construction company Galliford Try (83%) along with London investment companies AECOM (16.5%) and Fulcrum Infrastructure Group LTD (0.5%)
AECOM is 45% owned by a Southern Irish comany and Fulcrum is 100% owned by Luxenbourg company Meridiam Infrastructure Finance Ii)
Do these Luxenbourg and Southern Ireland financiers get to user this structure to avoid paying tax on 30 years PFI profits from this new Scottish cash cow?
And as part of the consortium with monopoly control of the Scottish PFI Territory Galliford Try announced in October 2015 they had "been appointed" the contract and £72 million public money to build a new Hospital in Haddington Edinburgh and a further £32 million of public money (PFI)
"to provide ongoing hard facilities maintenance and lifecycle management to the East Lothian Community Hospital. This contract will be worth approximately £32 million over the 25-year period. In addition to this, Galliford Try Investments will also be investing and providing management services to the company which will be set up to fund the project."
As the 83% owner of Space Scotland Ltd - which controls 60% of Hub South East Scotland - "Peter Truscott, Chief Executive of Galliford Try said
"We are delighted to have been selected by Hub South East Scotland for this major project in Haddington. This appointment demonstrates the capabilities of our combined offering across construction, facilities management and investments and we look forward to working with Hub South East Scotland and NHS Lothian to create the top class facilities the local public deserve.""
Hub East Central Scotland is in the control of private consortium Amber Blue East Central LTD which is 41.67% owned by London based Amber Investment Holdings LTD which is owned by Orangetone Ltd which has one director, Mr Giles James Frost, who is on the board of over 100 PFI companies across Britain.
Amber Infrastructure bought control of 100% of the Department of Education’s share in the BSF programme, giving the fund a minority stake in every local education partnership (LEP) in the country
And In 2011, Amber was appointed – as part of consortia – to manage a £55m regeneration fund in Wales, the £50m Scottish Partnership for Regeneration of Urban Centres fund, and the £100m London Energy Efficiency Fund.
Two Scottish firms, Forth PPP Ltd (16.67%) and Robertson Capital Projects Hub Investments LTD (41.67%) control the remaining share of the east central hub.
Hub North Scotland Ltd is controlled by another Scottish sounding private consortium“Alba Community Partnerships” which has no connection to any Scottish Community as the website states it is owned by Galliford Try Investments, Equitix and Sweett Investment Services
But the company name is now Acp North Hub LTD and the owners are listed as Galliford Try Investments (50%) and Sweett (50%)
On 23rd July 2014 the Press and Journal article, Galliford Try signs up for £50million-plus Highland school deals reported
"Expanding housebuilding and construction group Galliford Try will build the new Inverness Royal Academy and a primary school in Wick after netting deals worth a total of £50.8million. The contracts were awarded by public-private partnership Hub North Scotland and Highland Council"
- where Galliford Try and Sweett have 60% of the decision making power in Hub North Scotland and Highland council only has 2.5% of the decision making power.
This £50.8 million (capital cost) deal where Galliford Try is part of a company that controls 60% of the Hub company who awards the contract (and the council only has 2.5% so no control).
How many "contracts" are the Hub "consortiums" with monopoly control of Scotland awarded themselves?
Hub West Scotland Ltd is controlled by private consortium Wellspring Partnership LTD which has a complex ownership structure which leads all the way to American Bank J.P. Morgan controlling 80% of the consortium
Is this entire setup a very dangerous set up to slowly slowly catchee monkey where American bankers will get to use this structure to grandually take over control of each of the Hub territories set up by the SNP government (as Galliford Try is doing after they bought over Morrison Construction which initially was part of one of the Hub Consortiums) - with Scotland totally oblivious to becoming enslaved forever to American banks using PFI debt to achieve it?
Is that why Nicola and Alex kept racking up air miles to America and why Nicola flew over to America once she became First Minister, to hold a meeting with the American controlled IMF (where JP Morgan has very close links) with a secret side trip to Rupert Murdoch's office too?
And just like Upert Murdoch backed Blair, Clegg, Cameron and Salmond will she be handsomely rewarded for her loyalty to American banks– with Alex Salmond already reeping the rewards being paid £10,000, just to attend lunch with American hedge funds in London during the general election campaign, where they were all photographed laughing (at us) together.
The SNP government plan to add a further £9 billion to Scotland's existing £22 billion PFI debt now.
But the delayed SNP plan is actually to add £60 billion debt to Scotalnd's people's by 2030.
And that's a sum that American bankers would like to take over all five hub companies for - just as Galliford Try is working it's way to a 100% monopoly of Scotland for it's construction company's annual 20%+ profits increases.
Nicola, Alex and John Swinney and their board of PFI directors were attempting to hide their massive new PFI spending spree from Scotland and pretend it was not public works but the EU forced the Scottish Government to put all their new PFI plans on hold (other wise the PFI debt would already have been mounting fast despite SNP gaining power on promises they would stop PFI in Scotland - at a time when government and councils could borrow at the lowest rate of interest and build without PFI at the lowest cost in history).
The EU ordered SNP to now show the total cost of all PFI projects on the public accounts and only authorised the Scottish government to move ahead on that basis.
John Swinney is now desperately trying to see how he can change the model after this EU ruling – is that in an attempt to try to find a way round the new EU rules to again try to hide the colossal PFI debt?
And he thinks he has found it as an MSP explained
"Since the proposed NDP/PPP projects were deemed by the Westminster Office Of National Statistics" to be on the public sector because risk level to the private sector wasn't enough, the SNP are to get round this by changing the investments to about 25% government, 25% Charity (why SNP setting up a new "charity" for affordable housing?) and 50% private"
Like their Tory counterparts in Westminster using "charity" as the vehicle to replace democracy and "public" accountability.
And who will appoint the members of the board of the unaccountable, unelected "charity" the MSP pointed out saying "We will see what the ONS thinks of this new twist in the saga".
Let's ask Nicola and John Swinney as they attempt to hide up to £30 billion planned new PFI debt because Westminster and the EU said this is public debt and must be shown on the public accounts for the Scottish Government.
With the Guardian warning in December 2015 “The scale of the debt, which dwarfs Holyrood’s annual budget of £30bn, has never been set out by ministers or investigated by the Scottish parliament”. And “Scotland could have a £50 billion debt pile by 2020”
Now the EU has given the SNP the go ahead, as long as they make the total cost of their PFI plans public, here is just the first four PFI projects the Guardian revealed four months ago – projects SNP had hoped to start years ago..
● The Aberdeen western peripheral route’s current capital cost is stated as £469m, but private operators will charge taxpayers £1.45bn over the 30-year contract to fund and run it
John Swinney said on on 31st July 2015, "the capital cost was £745m and will cost £1.45bn over 30 years when maintenance and loan repayments are included".
So the capital cost has dropped £300 million according to John Swinney's own figures yet the PFI deal has not dropped £300million - ensuring an extra £300million PFI profit on top of the now £469m (not £745m John Swinney claimed).
● The new City of Glasgow College campus will cost £193m to build, but its private contract costs £604m
● The Scottish Blood Transfusion Service’s new HQ outside Edinburgh will cost £33.3m to build but involves £100m in running costs
● The new Anderson high school in Shetland will have a capital cost of £41m, but its lifetime cost through unitary charges will reach £102m.
Here is a table with the Scottish Government figures of the first of the SNP PFI projects showing how taxpayers are being charged an extra £2.08 billion on top for projects that total just £798 million - when interest rates and borrowing costs for governments and councils are at the lowest rate in history - the Motorways project, with the h ighest % mark up, is the project the CEO of the unelected quango Scottish Futures Trust, Barry White, now sits on the board of the PFI company delivering it.)
The Scottish Future Trust webpage lists the “value” of each project – which is not the total value once PFI charges are added, just the capital cost of the projects. - this despite the fact the EU ordered the SNP government to show the public the total cost of PFI projects,
This is just the first £2.9 billion PFI debt which the Scottish Government website shows as £796.8 million instead with the Scottish government stating they have another £6 billion PFI planned now.
And with 17 PFI schools closed in Edinburgh, as they cannot guarantee they are safe, with more PFI schools across Scotland now requiring urgent inspections too – Nicola Sturgeon is desperate to play it all down so as it does not interfere with the SNP £1billion PFI schools plan they are rolling out right now.
And so, Nicola has resorted to that old Westminster trick yesterday - “lets have a long term inquiry” – to try to push the scandal back out of the limelight – the only reason they announce an inquiry – to quell the public anger now so she can force another £1billion of PFI schools on us out of the spotlight again.
Just as the long term inquiries like Chilcott, Lockerbie, Hillsborough, State Child Sex Abuse – ensured there is no more public discussion and to ensure no one gets charged and all those involved walk away scot free and they all carry on doing the exact same thing while the public inquiry is going on – wars, child abuse, police wrongdoing, PFI - are the £9 billion of PFI profiteers hounding Nicola don’t let the PFI school safety scandal stop business as usual (give us a long term public inquiry to achieve it).
And all those “affordable homes” Nicola Sturgeon talks about – we are given the impression will be social housing for rent – that is another carefully crafted illusion as SNP have set up a new financial scam for them too – where the homes can be sold on just 6 years after they have been built, to make sure the council gets no further revenue despite putting up the money and Nicola claiming we will provide public housing.
The Scottish Futures Trust, set up to control PFI is part of the “affordable homes” plans –which has been designed to work as a PFI variant where everyone makes money – (with a taxpayer guarantee just in case they don’t) with tenants only guaranteed affordable rents for between 5 and 10 years and the private profiteers can sell the homes just 6 years after they have been built so the public loses all interest and income forever.
Here is the SNP government setup - their own special PFI variant for "affordable homes" they claim are public homes for rent - with the PFI Scottish Futures Trust involved, which will make the homes anything but affordable and anything but public owned in the long term for tenants.
Like the five Hubs they are public/private partnerships.
“The members of the LLP are the council, the developer and SFT. Once complete, the homes are purchased by the relevant LLP.
“The LLP pays between 65% and 70% of an agreed purchase price to the developer up-front. This contribution is funded by participating councils who provide loans to the LLPs in their area. This is primarily through on-lending borrowing which has been raised from the Public Works Loan Board (PWLB). The remaining 30% to 35% of the purchase price is contributed by the developer as a mixture of loan funding and equity investment.
Homes are expected to be available to tenants at an intermediate rent for five to 10 years. The developer puts in place an agent(s) to manage the homes and to carry out maintenance and repairs to agreed customer service standards. Managing agents allocate homes to tenants based on criteria agreed with the council.
Each LLP's income from tenants' rents will be used to pay interest to the council so it can finance its own borrowing for the initiative and will also pay interest on the loan from the developer and pay for agents responsible for managing and maintaining the homes. The Scottish Government provides a guarantee to participating councils that it will cover capital and interest payments due to the PWLB if the LLP is unable to pay what it owes to the council.
The developer can trigger the sale of the homes between years six and 10. The sales proceeds will be used firstly to repay the council’s loan to the LLP and then to recoup any calls on the Scottish Government guarantee. This is before the developer receives any repayment of equity capital (up to a capped level)."
And who is going to be building and profiteering from the “affordable” homes?
SNP (and Scotland) face it’s own China crisis as Nicola Sturgeon stands accused of misleading the public over the deal she singed in secret with a Chinese Construction company Norway refused to do any more deals with, warning they felt the company was highly corrupt.
When caught after signing the £9billion “memorandum of understanding” without informing the nation or Parliament Nicola Sturgeon claimed she did not tell anyone as nothing had been discussed about how it will be used.
The Chinese say it is their "one road one belt strategy" which they say is their "Marshall Plan" for 65 countries which it appears includes Scotland.
Days later the London Tory, Sir Richard Heygate, who negotiates the deals (along with the former director general of the Tory Party) and gets commission for "matchmaking" after he set up a company, 88 Initiative to help students from rich Chinese families to circumvent the new strict immigration laws, said Nicola Sturgeon had held discussions with the Chinese about 3 projects and was looking to start them within a year as it was revealed
“Sir Richard Heygate told BBC Radio Scotland today that discussions have been ongoing between the SNP Government and the Chinese consortium and that construction is due to start within a year.
Three projects have already been identified. These include 5,000 homes in Falkirk, Edinburgh and East Ayrshire, as well as a biomass plant in East Ayrshire and an unspecified railway project. He added that Ms Sturgeon had been an “enthusiastic” backer of the plans."
So will Nicola and the Chinese and the Scottish Future Trust board be building these homes under the terms of their PFI variant, National Housing Trust, for “affordable housing” for rent – where the rent is only affordable for up to 10 years max and they can be sold after 6 years to anyone that wants to be the new private landlord for them forever so tenants get fleeced and councils have nothing to do with the “affordable homes”.
It appears so as on 15th April 2016 the Herald story "Sturgeon signed £10bn deal with Chinese firm after 'flat pack houses' plan snubbed by council " revealed the Chinese have already approached Falkirk council to build flat pack homes using public money with the Scottish Government even trying to broker the deal - which the council says is illegal as all work must be put out to public tender by EU rules.
And are the Scottish government going to force every council to borrow the money and give it up front to the Chinese who then get to sell the homes - give the council back their borrowings and keep the rest under the SNP PFI variant National Housing "trust" model?
It appears SNP have carved Scotland up into a PFI monopoly board not only for English and Chinese construction companies but for Irish, Luxenbourg and American funds too (is that tax to enable avoidance via EU rules and UK government double tax agreements where the Chinese can opt to pay tax on profits made in the UK to the Chinese government rather than the UK and Scottish governments
The SNP Scotitsh Futures Trust and National Housing Trust all set up by SNP to ensure Scotland's people are just to be PFI cash cows for 30 years and more. in the new global order, with the public perpetually charged between 300% and 450% more than they should be for every public infrastructure project from here to eternity, no matter the quality.
This is what globalisation is all about -your government awards contracts to any one but companies in your country to enrich tax avoiders in other countries.
All this when interest rates are at the lowest in history and governments and councils can borrow borrow the money at the lowest interest rates in history - instead SNP like their Westminster Tory counterparts ensuring taxpayers get enslaved in debt for generations to come for shoddy PFI projects they are meant to deliver for government, NHS, police, fire service, courts, transport and more for American, Luxenbourg, Irish companies and banks who are borrowing at the lowest rates in history and charging us £billions extra on top of the construction charges.
The Scottish government is slashing council budgets and will not guarantee budgets for 30 years ahead for them yet every PFI Profiteer gets their taxapayer budget set in a legally binding contract for 30 years.
And now Galliford Try have a 40% monopoly of Scotland (effectively 60% as they are the only construction company involved in a 3rd Hub Territory consortium too) - despite a demand Galliford Try is banned from public projects in Wales. Why?
They ran 3 years over, and a "worker told BBC Wales: "You get sent to do something in the morning, and then halfway through the day you get pulled away to do something else. "So, boards and ceilings are going up without asking the electricians or the plumbers if they've finished in the roof. They then have to cut out holes to bring their cables through."
The plan forgot to include a dedicated care park with the costs spiralling constantly, with no end in site, going from £37m until the eventual cost totalled £49 million - a near 32.4% increase.
Morrison construction started the project but Galliford Try's performance after they bought the company over has been no better in this farce.
A professor of architecure said this week he has been warning for years about the shoddy PPP projects as the focus is on private profit not quality.
The SNP government's Scottish Futures "Trust" and the National Housing "Trust" are just the same PPP/PFI wolves being wrapped in sheeps clothing.