Highlights
[Highlight] Is the European Investment Bank not telling us something?
(March 25, 2008)
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"When not presiding over bank collapses or churning out boring budgets, Alistair Darling still finds time to be a governor of the European Investment Bank (EIB), a kind of European Union version of the World Bank.
Darling replaced Gordon Brown on the EIB board when he became chancellor and is assisted by British KPMG man Timothy Stone, an 'expert director' of the EIB. Like Brown, Darling is very keen on the PFI [private finance initiative], and with Stone's help they seem to have persuaded the EIB to lend massive amounts to British PFI schemes. Since the 2005 election alone, the EIB has loaned at least €2.5 billion (nearly £2 billion) to UK PFIs. EIB loans are at very good rates, so this represents a massive public subsidy to UK PFI schemes.
EIB loans have helped float some of the larger and more contentious PFIs: schemes backed since the last election include the Barts Hospital and Birmingham Hospital PFIs. Before then, £600 million of EIB loans went to the now-failed Metronet London Underground privatisation.
Stone is a frequent advisor to the government on PFI, and his company also has a particular interest as it frequently earns fees advising on schemes. Indeed, KPMG was paid to advise on four of the 15 PFI schemes backed by the EIB--the North Staffs Hospital, Cornwall Waste Management, Lanarkshire Schools and Northern Ireland M1/Westlink roads schemes--while these PFIs also received generous EIB loans."
Full text
Darling replaced Gordon Brown on the EIB board when he became chancellor and is assisted by British KPMG man Timothy Stone, an 'expert director' of the EIB. Like Brown, Darling is very keen on the PFI [private finance initiative], and with Stone's help they seem to have persuaded the EIB to lend massive amounts to British PFI schemes. Since the 2005 election alone, the EIB has loaned at least €2.5 billion (nearly £2 billion) to UK PFIs. EIB loans are at very good rates, so this represents a massive public subsidy to UK PFI schemes.
EIB loans have helped float some of the larger and more contentious PFIs: schemes backed since the last election include the Barts Hospital and Birmingham Hospital PFIs. Before then, £600 million of EIB loans went to the now-failed Metronet London Underground privatisation.
Stone is a frequent advisor to the government on PFI, and his company also has a particular interest as it frequently earns fees advising on schemes. Indeed, KPMG was paid to advise on four of the 15 PFI schemes backed by the EIB--the North Staffs Hospital, Cornwall Waste Management, Lanarkshire Schools and Northern Ireland M1/Westlink roads schemes--while these PFIs also received generous EIB loans."
CEE Bankwatch Network gratefully acknowledges EU funding support.