Islington Council is investigating two PFI housing refurbishment schemes in the north London borough following concerns about how contracts were tendered.
The local authority is reviewing the refurbishment of 6,500 homes, mostly delivered by United House for the council’s management company Partners for Improvement in Islington under two contracts worth a combined £240 million.
The review follows concerns being raised by leaseholders about the contracts. Leaseholders are charged up to £10,000 for the work, with the PFI consortium covering the rest of the cost.
Islington Council said it would look at whether contracts were tendered and let following established guidelines and whether they represented best value.
A spokeswoman for United House said: “We are fully supportive of Islington’s review into leaseholder invoicing in connection with the PFI contract.
“This review is part of a wider internal audit programme. We are aware that unfounded allegations have been made in connection with the contract. We strongly refute these allegations and look forward to the outcome of the review.”
A spokesman for Partners for Improvement in Islington said: “We fully support Islington Council’s review and we will continue to work with the council to provide excellent services to tenants and leaseholders.”
The review follows a report from the National Audit Office earlier this month, which criticised affordable housing PFI schemes for running over budget and time.
The report said 21 of the 24 PFI schemes used to deliver social housing had overrun budgets.
Housing minister Grant Shapps vowed to overhaul the way PFI was used to provide social housing.
Islington Council executive member for housing James Murray said: “We are committed to getting value for money and a good service for tenants and leaseholders from contractors. This report will be part of this process.”
The council will publish its report on the review next month.