At the Labour Party conference earlier this year, McDonnell announced that a Labour government would bring PFI contracts back in-house – although confusion surrounded the policy afterwards as it was suggested that only a handful of contracts might actually be brought under government control.
However, speaking on the BBC’s Andrew Marr show on Sunday, McDonnell appeared to suggest that the majority of contracts would be brought in-house.
“We are going to review the PFI schemes and then we will do deals on bringing them back,” he said.
McDonnell claimed the move would not cost the government anything, adding: “When you bring them back you will make a saving because you are not paying out expensive amounts of money in profits for those private companies. Over the life of those contracts the savings will pay for it.”
The suggestion that a Labour government would “do deals” to bring back the contracts will provide relief for some in the industry, who feared the party might try to simply legislate to bring back the deals in one go, creating all sorts of legal complexities and potentially damaging investor confidence.
McDonnell also said a Labour government would “go through every individual scheme”, adding that there would be consultation.
However, critics argue that such a process would be hugely time-consuming and potentially expensive for the government.