Hereford MP in PFI contract calls

The library and history centre in Worcester were part of a PFI project

An MP is calling for re-negotiation of building contracts private firms won, to help offset public spending cuts.

Treasury figures estimate the seven Private Finance Initiative (PFI) contracts in Herefordshire and Worcestershire may cost taxpayers £3bn.

In response, Hereford MP Jesse Norman has said contractors should "take some burden" of the cuts.

The cost of work on schools, hospitals and courts in the counties, since 1998, totals £464m.

PFI was introduced by the Conservative government in 1992 and continued by Labour and the coalition.

Mr Norman, who sits on the Treasury Select Committee, said 70 MPs are now backing calls for the PFI contracts to be renegotiated.

"These costs are fixed at a time when many of our public services are under pressure," he said.

However, John Winterton, Construction Director at BAM, the contractors that built four of the new schools in Bromsgrove, said his firm had only made 2.5 to 3% profit on its £65m contract.

"The contract is actually set up by central government - it's quite an onerous contract and it passes a lot of risk down to the PFI contractor, so we have to take that into account," he said.