In housing private finance initiative (PFI) schemes local authorities contract with private sector firms to build, improve, manage and maintain their social housing stock.
While management of the housing becomes the responsibility of the private sector contractor, the local authority continues to own the housing and retains its tenants. Good PFI deals transfer risks from the public sector to the private sector, whilst maintaining good value for money.
The projects that benefit most from PFI tend to have a capital-intensive element and a service provision element. The local authority pays for both elements over the course of a long-term contract, typically 25-30 years, on a performance-related basis.
The PFI approach offers an alternative to direct procurement, stock transfer and social housing grants, and the scheme can be applied to homes that are accounted for within or outside of the council’s housing revenue account. PFI credits have been made available from central government to support the capital element of projects.
Details of all housing PFI schemes - pdf (100kb) are available. In November 2010 DCLG announced the outcome of its review of all housing PFI schemes, either already under contract, in procurement, or in the pipeline. Thirteen housing schemes already in procurement and worth over £1.2bn will continue to be supported during the current spending review period. A further twenty-five housing schemes under contract will also continue to be supported, however funding support will be withdrawn for a further 13 pipeline schemes – those that had not already had their outline business cases approved – that would have cost an additional £1.9bn.
A complete list of those schemes and procurement and in the pipeline is available on request.
We are responsible for administering the housing PFI programme. We provide support to local authorities running PFI projects to help maximise outputs from the available funding, and will work with those authorities with pipeline schemes to look at possible ways of achieving their ambitions through non-PFI routes.