The government’s management of its 25 private finance initiative-funded housing projects has been weak and under-resourced, with 21 running over-budget, spending watchdog the National Audit Office has said today.

In its report on PFI in Housing,  published today, the NAO criticises the Department for Communities and Local Government for allowing the majority of projects to suffer delays and require extra cash injections from the taxpayer.

Local authorities generally use the PFI modal in areas of high demand for housing, where the housing stock is in poor condition. The long-term contracts are meant to be a flexible and long-term way of funding and maintaining new homes.

However, 12 of the 25 contracts have cost more than double  the expected amount, with an average delay of two and a half years.

The report says councils have questioned the level of expertise in central government agencies, namely the Homes and Communities Agency, to help them deliver the projects on time and on budget.

It also says the government has failed to work out whether PFI housing is delivering value for money.

Head of the National Audit Office Amyas Morse said: “The Department for Communities and Local Government has pursued the PFI funding route for improving housing stock with only limited evaluation of the value for money of the programme. It should now carry out such evaluation.

“The Department should assess, as a matter of priority, whether its current and planned PFI projects are delivering value for money. It should at the same time, assess all its past projects. This assessment should be based on hard numbers as well as qualitative factors.”

To read the full report, click here: PFI in Housing

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