4.43 Overall, this research indicated that because of the significant differences between ITPFI and PFI in other sectors, and the attendant difficulty of ensuring an appropriate sharing of risk through PFI, IT PFI may not be able to consistently offer value for money benefits. In particular many aspects central to IT procurement do not fit well with the central requirements of PFI, laid out in Chapter 3, particularly:
• the fast pace of change in the sector make it difficult for the public sector to effectively define the outputs it requires in a long-term contract;
• the high level of integration of IT infrastructure into the other business systems of the procurer makes it difficult to clearly delineate areas of responsibility to the client and the contractor, and so makes an appropriate sharing of risk more difficult to both discern and enforce;
• the lack of a market for third-party finance in IT PFI removes a powerful driver ensuring appropriate and effective risk allocation in a project. This detracts from PFI's ability to secure value for money for the public sector;
• the nature of the capital investment, with costs in IT dominated not by large up-front investment but by running costs; and
• the duration and phasing of investment, where IT projects have a short life,
and include significant asset refresh, makes defining and enforcing long-term
service needs more problematic.
These points are outlined in more detail below. The policy implications of these findings are detailed in Chapter 7.