This is the first time that a local authority has sought equity participation in an education PFI project. Supported by Partnerships UK, the former PFI Treasury Taskforce, the pilot sees Kirklees holding 30 per cent of the total equity stake of more than £500,000 and taking a seat on the project company’s board. Kirklees will take a share of the profit if the project succeeds, but will lose its equity stake if the project fails to perform. The other shareholders are Jarvis and Barclays Infrastructure, the latter of which will provide subordinated debt.
The new model aims to foster closer working relationships between the public and private sector during the course of lengthy PFI contracts. Kirklees is making its mark as an innovator: it is a joint venture partner in Kirklees Waste Management and in the vehicle responsible for the Alfred McAlpine Stadium.