2.2 Since the PFI was introduced over 25 years ago, the public sector has used PFI and PF2 to build a large number of new assets, such as hospitals and schools. There are currently 716 PFI and PF2 projects either under construction or in operation, with a total capital value of £59.4 billion.38 In recent years, the government's use of the PFI and PF2 models has slowed significantly, reducing from, on average, 55 deals each year in the five years to 2007-08 to only one in 2016-17 (Figure 6 overleaf). The total amount of investment in deals achieving financial close has similarly reduced - in the five years to 2007-08 it stood at an annual average of £5.5 billion; in the last two years it has averaged less than £0.5 billion, down from a peak of £9 billion in 2007-8.
2.3 A total of 7 out of the 11 departments we surveyed stated that the main reason for their reduced use of private finance in recent years was "concerns about cost efficiency and value for money". The government's decision in 2010 to remove PFI grants to local authorities and to halt the Building Schools for the Future programme, owing to high costs and long delays, also contributed to this reduction.39
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38 This is less than the original investment as some deals have been terminated, such as Transport for London PFI deals, and some contracts have ended.
39 Hansard HC, 5 July 2010, cols 47-49.