When the Private Finance Initiative (PFI) first came on the scene in the early 1990s it was immediately clear that a great deal of work had to be done before what, in essence, is a relatively simple concept could be made to work in practice. The critics (and they were around then as well as today) rightly pointed out that no private sector entity could borrow as cheaply as the government of the day. How, then, could PFI transactions ever pass the conflicting tests of value for money and risk transfer that lay at the cornerstone of the whole concept?
