Effectiveness of private finance initiatives (PFI): study of private financing for the provision of capital assets for schools


  • Nada K. Kakabadse,

    1. The University of Northampton, Northampton, UK
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    • Nada K. Kakabadse is a Professor in Management Business Research in Northampton Business School.

  • Andrew P. Kakabadse,

    Corresponding author
    1. Cranfield School of Management, Beds, UK
    • Cranfield School of Management, Cranfield, Bedfordshire MK43 OAL, UK.
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    • Andrew P. Kakabadse is a Professor of International Management Development in Cranfield School of Management.

  • Nick Summers

    1. The University of Northampton, Northampton, UK
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    • Nick Summers is a Post-Graduate Researcher in Northampton Business School.


The study reported in this paper explores how effective Public Private Partnerships (PPP) have been as critical providers of capital assets within the state education sector in the UK. Specifically, the research investigates the impact on educational provision of the UK government's contentious £43 billion Private Finance Initiative (PFI). The inquiry focuses on 27 English Local Education Authorities (LEAs) currently or recently involved in PFI. The investigation examines the effect of PFI's on LEA decision-making processes and discusses these authorities assessment of the UK government's current PFI strategy. An evaluation of PFI as a source of sustainable finance is reported as well as recommendations made for LEAs currently considering adoption of PFI. Through such analysis, this study seeks to de-layer and ascertain the influence of complex external environmental influences and stakeholders that need to be taken into account in order to make PPPs work. The paper concludes by presenting the critical considerations for enhancing the working relationship between private and public sector partners. Copyright © 2007 John Wiley & Sons, Ltd.