Originally launched in 1992 by the then Chancellor of the Exchequer, Mr Norman Lamont, as the Private Finance Initiative (PFI), it sought to allow the public sector to benefit from private sector finance and project management skills.

The initiative also freed up badly needed public funds for projects unsuitable for the private sector to finance. The scheme has been enthusiastically continued under New Labour.

The value of current PPP projects in the UK exceeds £15 billion sterling and consultants estimate that there is a further £10 billion worth of projects in the pipeline. PFI projects in the UK have included economic infrastructure, health and education services, social welfare payment systems and prison services. The apparent success of British PPPs in the UK can be attributed to the size of the potential market where the volume of projects that can be brought forward at any one time allows for economies of scale in the procurement process.