No Evidence on Value for Money of PFI projects say MPs

Not a candidate for PFI, the infamous Duckhouse.

The private finance initiative may have delivered many new hospitals (including the new City Hospital in Peterborough), and homes which might otherwise not have been delivered, but there is no clear evidence of whether PFI is any better or worse value for money than other procurement routes, MPs have said.

In a report on the use of PFI in hospitals and social housing, the influential Public Accounts Committee said that by April 2009, there were 76 operational PFI hospitals in England and more than 13,000 homes had been built or refurbished through PFI, “representing a small but significant part of investment in social housing”.

It said: “As with previous reports, we again found no clear and explicit justification and evaluation for the use of PFI in terms of its value for money. However, we accept that the then government gave the Departments (the Department of Health and the DCLG) no realistic alternatives to PFI as the procurement route to use for these capital programmes.”

The committee said its other concerns revolved around central government's failure to use the market leverage that comes from overseeing multiple contracts, and the lack of robust central data to support effective programme management.

The MPs suggested that there were cases where PFI was used where there was no evidence it was the best procurement route.

They called on the government to do more to:

- identify the circumstances where PFI works best
- capture the lessons learned from PFI procurements, and
- apply clear criteria to future decisions over identifying the best route for particular public infrastructure investments.

The committee said it expected any procurement decisions on the housing projects whose future is now being reconsidered in the context of the Comprehensive Spending Review “to be made using clear value for money criteria”.

The report claimed that it was clear that implementation of PFI projects could be improved.

“Many PFI housing procurements have taken very much longer, and cost a great deal more, than originally planned,” the MPs said.



(C) Park Farm Neighbourhood Watch Peterborough UK Tel: 01733 345581 Broadcasters direct call ISDN 'down the line' 01733 555319 ISDN Codecs G722 & APT All Press Enquiries Julian Bray 01733 345581