Pinsent Masons has won a role on a major waste deal that could mark a volte-face over the Scottish government’s opposition to PFIs.
The firm is advising Edinburgh and Midlothian councils on the project, which will involve the construction of a waste treatment plant by a private sector contractor to be tendered for in early 2010.
The exact structure of the deal has yet to be determined, but it is certain that it will include substantial elements of English-style PFI arrangements, with some possible adaptations.
Scotland’s SNP government has always opposed PFI deals because of the perception of private sector shareholders reaping massive profits at the expense of the public purse. Instead it has used the non-profit distribution model, which channels profits back into the project itself or charitable concerns. However, critics claim this approach is flawed because it lacks a market incentive.
Pinsent Masons projects consultant David Nash, who is leading the deal alongside environmental partner Gordon McCreath, said: “The Scottish government is historically anti-PFI. But to maximise marketability we wanted to some extent to follow English precedents as closely as possible, [adapted] to address Scottish government concerns.”
Pinsents beat off competition from six other firms to pick up the deal.
There is a wave of waste projects currently being tendered in Scotland including in Ayrshire, Borders, Glasgow and West Lothian. This comes as councils across the UK procure waste treatment projects to avoid being fined under the European landfill directive.
Pinsents also advised one of the special purpose vehicles on Europe’s largest waste PFI - Greater Manchester (The Lawyer, 20 April).