7. When the basis of a Private Finance contract needs to be altered post procurement because of changing client needs-for example, a bigger jail is required due to a larger than expected prison population-has this proved problematic compared to projects under traditional procurement? What has been the experience of PFI projects that have reverted to the public sector?
7.1 It is acknowledged that it can be cumbersome to change the use of a facility under PFI, slightly less so under LIFT, and this is an area which does require improvement. However, it should also recognised that changing contracts in this way is much more time and cost effective than having to implement a new procurement exercise. In addition, it used to be the situation pre-LIFT where the public sector constantly changed its mind about what it wanted. This led to the illusion of flexibility as frequently when a change in specification was requested, part of a new built facility was knocked down before it had even been brought into use. This resulted in huge cost overruns and court cases with contractors. We should therefore not necessarily aspire to the situation that went before. Under LIFT, private sector partners will accommodate requests from PCTs to update, improve or change the facility at any point after the completion of the initial construction phase, with value for money guaranteed by market testing-the only constraint in this situation is sign-off via the Strategic Partnering Board.9
7.2 The LIFT Council would therefore argue that the crux of this issue is enabling public sector partners to understand what they want and ensuring any facility strongly aligns with local need, existing estate and strategic objectives. In LIFT, the private sector partner can be used to support the PCT's vision and ensure very little needs adjusting. Flexibility and future-proofing can be built into a facility as required, though too much can be the product of poor remitting.
7.3 The estates strategy is therefore critical and it is in this area that the LIFTCo can work together with the PCT to identify where the existing estate is holding back quality and cost improvements in clinical service delivery and improved value for money. Indeed, 2008's Pre-Budget Report announced that the Department of Health will enable PCTs to extend LIFT public-private partnerships to the management of their entire estate and we look forward to working with colleagues at the Department and our PCT partners to make this a reality.
7.4 The LIFT Council is only aware of one project having reverted to the public sector which makes this question difficult to answer.
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9 The Strategic Partnering Board is a body set up by the parties to an SPA (Strategic Partnering Agreement) and other co-opted parties, which meets regularly to consider (among other matters) how the SPA is operating. The SPB acts as approver for the SSDP (Strategic Service Development Plan).