7.2.1 The terms PFI and PPP are largely interchangeable. The first refers to the Private Finance Initiative, which introduced private finance into the funding of public sector projects, and the second refers to Public Private Partnerships, which describes the relationship between public and private sector organisations using private finance to fund public sector projects.
7.2.2 The Scottish Government subsequently introduced the Non-Profit Distributing (NPD) model to describe a variant of the PFI arrangement to be used in Scotland.
7.2.3 The first PFI schools programme in Scotland commenced in 1998 prior to Scottish devolution in 1999. It involved ten local authorities, 75 schools and represented investment worth over £500m. The first schools were delivered in 2000 and the last school under this first scheme was completed in 2005.
7.2.4 The Scottish Government provided financial support for this programme as a means of encouraging participation by Local Authorities. The programme was known as Level Playing Field Support (LPFS). By 2010 the amount of annual revenue support from the Scottish Executive for LPFS amounted to £44.4m.
7.2.5 The ESP PPP1 project for 17 schools was one of those that received support under this programme.
7.2.6 The second schools PFI/NPD programme in Scotland commenced in 2002. It involved 30 local authorities, 200+ schools and represented investment in the school estate worth around £2.8 billion. The first schools under this programme were delivered in 2004.
7.2.7 In 2006, under this programme and following a separate PPP procurement process, Edinburgh Council signed a second PPP contract ("PPP2") for a further eight schools which were completed in 2010.