Equity investors have helped to deliver many public sector infrastructure projects via the Private Finance Initiative and have managed them in ways from which the public sector can learn. Against a background of limited information, evidence gathered by the National Audit Office raises concern that the public sector is paying more than it should for equity investment.
Sir John Bourn, head of the National Audit Office, provided Parliament today with a ground breaking report explaining the National Audit Office’s approach to examining the value for money of deals under the Private Finance Initiative (PFI). Having already published eight reports on major privately financed projects Sir John said the time was now right … Read more
By setting up an Infrastructure Financing Unit, Treasury helped reactivate the lending market for private finance projects. While the costs for projects in 2009 represented value for money, Treasury should not presume that continuing the use of private finance at current rates will be value for money.
“When a Government Department is considering major investment in new accommodation, the full scope of the requirement really must be properly defined from the outset. In this case GCHQ failed to consider all the implications of the fact that it was relocating its entire business capability to a new building and that transition of its computer systems to the new premises was a major factor.
“However, other Government Departments might learn lessons from the way that GCHQ developed its programme management arrangements for this major hybrid change programme. Departments should follow best practice and should especially focus on introducing programme management procedures to identify, plan and then deliver all the benefits attainable from their PFI programmes.”
“This major contract has been significantly affected, for the contractor Mapeley in particular, by the current economic climate. Mapeley benefited when the property market was expanding but the economic downturn has made the contract more onerous. HMRC must take a significantly more astute commercial approach if it is to deliver value for money for the taxpayer.”
Modern light rail systems, such as Croydon Tramlink and Manchester Metrolink, have brought significant benefits to passengers, according to a report Parliament by the head of the National Audit Office, Sir John Bourn. They deliver fast, frequent and reliable services and provide a comfortable and safe journey. Their modern look and attractive services have enhanced … Read more
“The tendering process is a vital part of the whole PFI deal and the recommendations in my report need to be acted on to secure better tendering and value for money.”
Sir John Bourn, Head of the National Audit Office, told Parliament today that the funding competition used to finance the refurbishment of the Treasury building in Whitehall saved the taxpayer £13 million. The competition resulted in savings of 7% of the cost of the deal over the lifetime of the project and assisted greatly in … Read more
“This is a good example of a public sector body acting quickly and taking risks that were well thought through and which paid off in providing real patient benefits. This report contains important recommendations for the Department of Health which will help it replicate this success and encourage innovation more widely.”
