3.3 Arguments as to the importance of risk transfer are further undercut by research which found that hospital trusts were paying a "risk premium"-conservatively estimated at 30% of the total construction costs-to ensure projects are running to time and budget.17 So while it is true that the private sector absorbs the cost of overruns etc, additional charges are written into the contracts to account for this.
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17 Edwards P, Shaoul J, Stafford A, Arblaster L, (2004) Evaluating the operation of PFI in roads and hospitals research report no 84, The Association of Chartered Certified Accountants. London: Certified Accountants Educational Trust, at p 10. Available at http://www.accaglobal.com/publicinterest/activities/research/reports/accountability/rr-084