Scottish Labour calls for halt to PFI deals and demands rethink on public procurement

In his first conference speech as Scottish Labour party leader, Richard Leonard committed to “signing no new private finance deals” and demanded a review of how the public sector purchases goods, services and construction projects in Scotland.

The party leader said should he become first minister then he pledged to “call a halt” to the use of PFI funding schemes and said it was “unjust” that private companies are “raking in millions in profits” under schemes such as PFI, public-private partnerships and the Scottish Government’s NPD system of funding.

Leonard who took the reigns of Scottish Labour last November said the party would use a parliamentary debate to demand a rethink of public procurement in Scotland, amid growing concern about how public projects and services are delivered. He also confirmed the party’s manifesto for the 2021 Holyrood election and claimed they would commit to not signing any new private finance deals for public projects. “Why don’t we simply call a halt to the racking up of extortionate PFI debts which push local services to the brink?” Leonard added.

The conference also discussed the party’s forward looking Industrial Strategy which recommends we stop awarding billions of pounds of public procurement contracts to companies that don’t pay the living wage, use zero-hour contracts or blacklist workers.

The strong line taken by the opposition party comes after a number of notable failures connected to public procurement in Scotland. This includes the liquidated outsourcing giant Carillion which had contracts with a number of public sector agencies in Scotland worth at least £630m.

The urgent review demanded should also scrutinise employment practices and the operation of the  Scottish Futures Trust (SFT) which was set up by the Scottish Nationalist Party to deliver a version of the private finance initiative for infrastructure projects.

Scottish Labour’s economy spokesperson Jackie Baillie said: “The public sector in Scotland spends billions on procurement every year. That’s money that should support the delivery of public services, providing decent jobs and helping to grow the economy. But in all these areas we are being failed by the SNP. That’s why we need an independent, root and branch review of how public procurement is operating in Scotland, including the Scottish Futures Trust. SNP economy minister Keith Brown has tried to convince us everything is fine, when the clear reality is that he has been sleepwalking into a crisis.