Even before the collapse in January of Carillion, one of the largest and hitherto most successful private finance initiative (PFI) operators, the storm clouds were gathering over the future of public private partnerships in the United Kingdom.

In the midst of strong economic and political headwinds, ministers’ enthusiasm for using PPPs has been on the wane. Now, the insolvency of Carillion has added to uncertainty, highlighting to an already skeptical market the risks of taking on complex and costly projects in an era of austerity.