LABOUR ramped up its calls to end the scandal of private finance initiatives (PFI) today following a damning report by Whitehall’s spending watchdog.

The National Audit Office (NAO) found little evidence that government investment in more than 700 existing public-private projects has delivered financial benefits.

And it found the cost of new privately financed projects such as building schools “can be 40 per cent higher” than using public money.

The auditors also disclosed that taxpayers will be forced to hand over nearly £200 billion to contractors for at least 25 years on projects with a capital value of just £60bn.

Although the findings were made before the collapse of privateer Carillion, they included the revelation that The Tories have a £2.6 million equity stake in one of its major projects — public money that is now at risk.

Following Carillion’s fall, unions have reported cases of workers and apprentices being laid off across the country with numerous construction projects halted, and no certainty over when work would restart.

Shadow chief secretary to the Treasury Peter Dowd said the NAO’s report “only further demonstrates this Tory government’s continued commitment to fleecing taxpayers for the benefit of large PFI firms.

“It also raises more questions over the use of PFI in a week in which the Carillion scandal has left many fearing for their jobs and standard of their public services,” he said.

“The next Labour government will draw a line under the failed PFI approach to public investment, and will replace it with a transparent and accountable approach, which will reduce the costs and deliver significant savings to the taxpayer.”

Unison general secretary Dave Prentis said: “PFI hasn’t made schools or hospitals run any more efficiently, and the deals that may have seemed to some like a good idea at the time will also have ended up costing significantly more.

“Many local communities might have seen shiny new schools and hospitals constructed, but the spiralling costs have cost taxpayers a fortune. Millions of pounds of public money has been wasted that could have been spent improving public services.”

Following union calls, the government has set up a national taskforce on Carillion, which met today, with the TUC calling for protections for pay and pensions, and a moratorium on future outsourcing.

Labour leader Jeremy Corbyn said he wants to see changes to procurement rules to make the public sector the default choice for running government services.