ABSTRACT
The Private Finance Initiative (PFI) was introduced in November 1992 by the then Chancellor to make private capital available for the development of 'public' infrastructure and facilities. Revised arrangements in 1994 required that the PFI option be explored by any public body seeking capital investment. From the late 1990s, under New Labour legislation was enacted which first, clarified the legal powers of NHS bodies to enter into PFI contractual agreements and second, provided a guarantee in law that PFI payments by NHS bodies would be 'ring-fenced' to protect them from any future pressure on NHS budgets. The first 'wave' of thirteen PFI new build acute hospital schemes was announced in July 1997 and it is with these that this paper is concerned. This chapter considers the benefits managers speak about in relation to PFI. It discusses the difficulties and concerns they have experienced with it; and finally, the relationship of PFI to the new public management agenda.
