5.29 Private sector experience and views of the PFI process and the strength of the market remain of importance to the Government. HM Treasury conducted research into private sector participants' experience of PFI over 2002 in order to assess areas where private sector concerns might be impacting on the effectiveness of the PFI programme. Opinion was positive about PFI. In particular:
• all firms involved expressed pride and satisfaction in the facilities they have provided to the public sector through PFI. All believed they had contributed to an outcome which would not have been possible under conventional procurement and that this represented good value for money for the public sector;
• most were content that the risk sharing approach of Government set out in standardised contracts was a reasonable allocation of risks. Most also provided examples of where risks had materialised in practice, reducing their returns due to increasing costs which they had borne, and demonstrating that risk transfer has been effective; and
• most were content that the future flow of PFI projects was sustainable. All contractors sampled were happy there was sufficient funding liquidity available for projects, as were the funding sources surveyed.
5.30 Where the private sector raised concerns, these centred on:
• high bid costs, particularly after recent changes introduced by the Accounting Standards Board in the accounting treatment of such costs and for some, the length of time taken by some departments and authorities in procuring PFI projects; and
• some were concerned that the Government may pursue an approach to risk transfer that was unsustainable, seeking to transfer too much risk to the private sector. As outlined in Chapter 3, the Government's approach to risk sharing in PFI is to seek to transfer only those risks that the private sector can more effectively manage. It does not seek to maximise risk transfer, as this would offer poor value for money.