Private finance initiative: Cost rise for Devon projects 1 May 2013 Last updated at 06:00 By Simon Hall BBC South West Home Affairs Correspondent Building works in Devon paid under the private finance initiative (PFI) will cost nearly five times more than the initial price, BBC News understands. Government figures show the PFI cost of funding schools, hospitals, armed forces' accommodation and major buildings will be nearly £2.4bn. PFI allows the government, which plans to reform its use, to fund works without paying full costs at the start. Unions and some politicians have said PFI is a waste of public money. Taxpayers fund expenditure There are eight major PFI projects in Devon which include the upgraded A30 in the east of the county, new schools in Exeter, Plymouth and Torbay, a community hospital in Tiverton and accommodation at Devonport Naval Base in Plymouth. Exeter's combined court building was also built as part of a PFI scheme. Calculations estimate the capital cost of the new infrastructure is £530.2m and the total repayment cost will be £2.394bn. The county's taxpayers will be funding the expenditure for up to 30 years. The biggest margin on a project is new accommodation for services' personnel at Devonport Naval Base in Plymouth. Its eventual cost of £554m is more than 12 times the initial building price. Analysing the figures, it is noticeable the projects with the biggest profit margins for contractors were negotiated centrally, by government, while those signed by local councils appear better value for money. PFI has proved controversial with criticisms that it is overly generous to the private contractors. Private companies carry out the construction work and maintenance, in exchange for regular payments from the taxpayer. Some schools, including in Exeter, have said the quality of parts of their new buildings have been poor. Other public bodies, such as hospitals, have complained that large debt repayments, over long periods of time, make it difficult for them to balance their books. However, defenders of PFI said it provided new infrastructure which would otherwise be unaffordable. The government announced PFI was to be reformed, with the taxpayer taking a share in projects and any profits. It added the scheme would also be made more transparent and efficient. PFI began in the UK in the 1990s under the Conservative government of John Major, and accelerated during the Labour administrations of Tony Blair and Gordon Brown.