B.11 HM Treasury believes that derogations from SoPC4 or approved sector specific contracts should only be made in exceptional circumstances on project-specific grounds. We would emphasise that it is essential that sponsoring departments take an active role in ensuring that the policy on standardisation is implemented.
B.12 If sponsoring departments are aware that individual PFI projects (for which they have oversight) are seeking to derogate from the Core Areas they should, in the first instance, directly assess the specific derogations and work with the Authority in order to reduce these to a bare minimum before presenting a case to Infrastructure UK. Sponsoring departments should avoid approaching Infrastructure UK without having first convinced themselves through detailed assessment that there is an exceptional project specific need for any such derogation.
B.13 If Infrastructure UK is presented with extensive derogations reports it is likely to revert to the department to challenge this position. It should also be borne in mind that the more extensive the derogations presented the longer it is likely to take to reach an agreed position. Such timing concerns should be taken into account in timetables for closing deals. While Infrastructure UK will make every effort to be responsive to the needs of Authorities and departments, the last minute provision of extensive derogations will be likely to slow the procurement process. Where significant changes to Core Areas are sought, it is advisable to seek guidance from Infrastructure UK earlier in the procurement process.
B.14 Subject to the above, Authorities should seek derogations approval once contractual drafting is settled. In the case of a procurement using the competitive dialogue procedure, as there can be no significant changes to the PFI contract following final tender, approval for any necessary derogations should be sought in respect of each bidder prior to conclusion of the dialogue.
B.15 It is not expected that further derogations would arise after this time, but if they do, they must be submitted to Infrastructure UK for approval prior to financial close of the project. Infrastructure UK should, in any event, be notified when the project reaches financial close.
B.16 Infrastructure UK would not normally expect to directly engage in contract discussions relating to derogations with private sector parties involved in PFI deals such as lenders and equity providers. Infrastructure UK's contact would usually be through the public sector bodies responsible for the contract. This is to ensure that there remains a clear line of communication and responsibility in such negotiations.