USING private finance deals to pay for major public projects was questioned yesterday, after more than £20 million of taxpayers' money was spent returning a troubled college into public ownership.
The Scottish Funding Council (SFC) approved the £27.5 million buy-out of West Lothian College's Private Finance Initiative (PFI) contract.
Six years ago, the college became the first in Scotland, and just the second in the UK, to be built using P
FI.
But in 2005, the Scottish Parliament's audit committee warned that the college faced an £11 million budget shortfall as it tried to meet its PFI payments over the next 20 years.
Late last year, the Scottish Executive backed the SFC's recommendation that the college's PFI contract be bought out.
Last night, Fiona Hyslop, the SNP's education spokeswoman, said "lessons must be learned" about how public projects are financed.
She said: "This move shows how fundamentally flawed PFI is because at the end of the day, the taxpayer is having to pick up the bill.
"I agree that this is the right move for West Lothian College and should prove cheaper in the long-run.
"But serious lessons have to be learned about PFI, which provides excess profits for private financiers."
Ms Hyslop said that if her party wins the election on 3 May, they would replace PFI with an independent, not-for-profit trust.
Sue Pinder, the principal and chief executive of West Lothian College, which contributed £5.5 million to the buy-out, said the PFI contract "did not offer the college the flexibility" it required.
She said: "We explored every conceivable alternative and agreed that voluntary termination was the best way forward for the college
"We would like to thank everyone involved for their co-operation, understanding, and confidence."
A spokesman for the funding council said: "We are satisfied, after a full examination of the options, that this agreement offers best value for public money to deliver the best vocational education to the people of West Lothian."
