10. Is there an optimal mix between conventional public procurement and Private Finance for public sector investment? What is the long run role of private finance in the delivery of infrastructure both in the UK and globally?
10.1 Ultimately, all the complexity of PFI is designed to create an arrangement whereby the right people are incentivised to do the right thing in order to deliver public services. As noted above, PFI is not the appropriate structure in all cases. The objective should be value for money and in our view both conventional procurement and PFI have a role and in fact a spectrum should be available. The market can help decide the best mix through its responses to the needs of government and it is not necessary to be dogmatic. The policy framework should be enabling rather than limiting.
10.2 Private finance is in our view likely to continue to have a useful role unless a political decision is taken to further increase gilts issuance or taxation and deliver all infrastructure assets through conventional procurement.
James Stewart
Chief Executive, on behalf of Partnerships UK
23 September 2009