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John McDonnell 'would bring existing PFI contracts in-house' 
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John McDonnell 'would bring existing PFI contracts in-house' - http://www.bbc.co.uk/news/uk-politics-41379849

That I could dare to dream... But it's more likely you'll get yourself involved in some sort of bunfight just as the Tories are on the ropes, as you ever being in that position at all.

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Mon Sep 25, 2017 5:20 pm
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And the cost could be huge as I assume the PFI contracts have hefty break clauses

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Tue Sep 26, 2017 12:30 pm
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maybe just a Labour 'ambition' just like uni fees ...

sorry forgot to mention Phucking Financial Incompetence PFI ...

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Last edited by MrStevenRogers on Tue Sep 26, 2017 1:30 pm, edited 1 time in total.



Tue Sep 26, 2017 1:07 pm
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There might be hefty break clauses in the contracts but don't forget that a government can legislate. They'd have to be careful how they did it of course but what they need to do is create conditions where it's better for the private companies to surrender the contracts. It could be done with a windfall type tax (or even the threat of a windfall tax - hand back the contracts or we'll make them cost you more than it does the state) or they could freeze out the ability of the suppliers to raise prices so it becomes less economically attractive to hold the contract over time.

The nuclear option is just to put in some sort of state by-back legislation heavily weighted in favour of the state - surrender the contract or we'll by it off you for £1. That would however create problems in the future if the state ever wanted to use any form of private investment again but it's a possibility and one that would certainly appeal to the really hard left.

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Tue Sep 26, 2017 1:18 pm
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davrosG5 wrote:
There might be hefty break clauses in the contracts but don't forget that a government can legislate. They'd have to be careful how they did it of course but what they need to do is create conditions where it's better for the private companies to surrender the contracts. It could be done with a windfall type tax (or even the threat of a windfall tax - hand back the contracts or we'll make them cost you more than it does the state) or they could freeze out the ability of the suppliers to raise prices so it becomes less economically attractive to hold the contract over time.

The nuclear option is just to put in some sort of state by-back legislation heavily weighted in favour of the state - surrender the contract or we'll by it off you for £1. That would however create problems in the future if the state ever wanted to use any form of private investment again but it's a possibility and one that would certainly appeal to the really hard left.

Those tactics have been used in Russia, Venezuela and Argentina. But those aren't the greatest rule of law states. In Britain all of the tactics you describe would be challenged in the courts and struck down given that they are nakedly predatory renegotiations in bad faith. In order to make any of them work at all, the first step would therefore have to be a major rewriting of UK contract law, granting powers to renegotiate in such a way to the state on some sort of strategic basis, or under some other doctrine of unusual force outside of emergency.

Unfortunately, given that similar contracts are used to raise all the sovereign borrowings that make our government work day to day, the instant effect of even presenting such a bill to the House would be to bring the UK's sovereign credit rating down to the sort of status enjoyed by countries who break contracts and expropriate assets outside of emergencies. Which would be ironic, because then we get an actual emergency.


Wed Sep 27, 2017 2:55 pm
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The best way if you really wanted to do it would be to get the companies to comply with every letter of the contract and then when they don't invoke the break clause

Lots of contracts like this also have a break clause for negligence / bad faith etc - so if they are run by a big company the 1st bit of bad press you might be able to use that as an excuse to break the contact

- the idea is to make it so unattractive to keep it that they just hand it back

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Thu Sep 28, 2017 8:07 am
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