North Yorkshire Fire Service Facing Final PFI Price Hike Before "Mortgage-Free" Future

Building costs for the service will rise by £100k in the coming year before the long term PFI deal expires in 2027.

North Yorkshire Fire and Rescue Service is set to navigate a final financial hurdle in its building costs this year, with payments under the Private Finance Initiative (PFI) rising by £100,000. However, officials have confirmed that the service is on the brink of significant long-term savings as the long-standing contractual scheme prepares to expire next year.

The projected increase in PFI costs for the 2026/27 financial year is attributed to contract prices being linked to Retail Price Index (RPI) increases. Despite this short-term pressure, the service is looking toward May 2027, when the PFI contract officially concludes. At that point, the financial burden is expected to ease considerably, with ownership of the buildings transferring to the Mayor.

Michael Porter, the Deputy Officer for Police, Fire and Crime Functions in North Yorkshire, compared the transition to a homeowner finally clearing their property debt. He stated:

"The PFI contract ends in May 2027. So we're into almost the last 12 months of that contract.At the end of that, the amount that we will pay for it will drop down significantly.

So that's like your household where you've stopped paying your mortgage. You still got to pay for all of your bills. You just don't have to pay your money to the bank anymore. So that's what happens in in May 2027.

The ownership of those buildings will pass to the mayor and from a operational perspective, they will continue to deliver in the same way as they have done".

This shift in ownership is viewed as a pivotal moment for the service’s future financial health. The money currently tied up in contractual bank payments is earmarked for reinvestment into the workforce, specifically to bolster training programmes.

Jonathan Dyson, North Yorkshire’s Chief Fire Officer, highlighted the importance of this transition, noting:

"This is an opportunity for the service because the mayor will own that estate and hopefully then some of the funding then that we're not putting into the uh contractual payments allows us then to have an investment portfolio in training which is absolutely essential for us.

That's clearly stipulated in both the fire and rescue plan and the community risk management plan is our commitment to that training environment".

The condition of the fire service's buildings has been a point of focus for leadership. Efforts are already underway to address years of limited investment through a new joint maintenance agreement with the police. This partnership aims to ensure that repairs are handled more efficiently, with a commitment to responding to call-outs within 24 to 48 hours.

Michael Porter, explained the necessity of this new approach:

"One of the things we've been open about is the fact that the estates from a fire perspective hadn't been invested in in the way that we would have liked over a number of years.

So what we've done now is we've put a contract in place with the police and we've jointly procured a contract that will look at the repairs and maintenance of the entire estate.

What that will provide is a more reactive service repairs and maintenance and call outs will be done in 24 or 48 hours, but also they've done a whole review of the estate and planned out what we need. to do to be able to bring it up to a certain standard. So that's why we're investing in that area".

The broader financial plan for the service includes a focus on the Yorkshire Coast, with Scarborough station identified as a priority for redevelopment. Nearly £14 million has been set aside within the capital programme to facilitate improvements at several key sites, including the Scarborough station, to ensure they meet the demands of a modern fire service.

While the £100,000 increase in PFI costs represents a challenge in the immediate budget, the forecast for the following year shows a dramatic reduction. PFI expenditure is expected to drop from over £2 million in 2026/27 to approximately £1.37 million in 2027/28, providing the service with the "mortgage-free" stability it has long sought.