Unitary Payments

5.2  The Authority will need to be assured that any change to the unitary payment is properly calculated. The contract will normally include a cost adjustment mechanism for translating changes in costs into changes to the unitary payment. The outcome of the review will not necessarily be a direct pass through to the public sector of the benefit or burden of the cost change. Normally, the revised cost will apply at subcontractor level, and it is important that the Authority is clear how this translates through into a revised unitary payment against the PFI contract. The Authority may need the assistance of financial advisors to check that this is done correctly, and that any allowed overhead costs are transparent and are applied appropriately.