Key findings relating to the operational phase:

•  most authorities consider that their PFI projects deliver good value for money although there was a decline in satisfaction since the contracts were let;

•  the public sector needs careful project management and close management of the relationship with contractors to ensure value for money;

•  most relationships with contractors are good;

•  development of a successful relationship will be assisted by the right contractual framework, which will include allocating risks correctly and clearly defining areas of service quality;

•  although most authorities were satisfied with the risk allocation in their contract, only two-thirds of contractors felt the same way;

•  more than half of the authorities had made deductions for poor performance;

•  there was evidence that authorities and contractors were using performance review processes to bring about positive changes in the way services were delivered;

•  authorities had limited experience in using benchmarking;

•  dealing with change was a significant issue; the change mechanism had been used in 55 per cent of projects with change procedures;

•  having staff with the right skills is critical to good contract management; this includes a thorough understanding of the project and an ability to build effective relationships with contractors;

•  there was considerable variation in the extent of the training provided; there was also difficulties in achieving staff continuity;

•  contractors believed there should be better training for public sector staff;

•  most authorities and contractors believed that governance arrangements were working well;

•  some contractors said they were unable to be innovative due to the fixed views of departments;

•  three-quarters of contractors thought authorities had adopted an appropriate approach to contract monitoring, although some thought the authority had become too closely involved; and

•  both parties need to review their relationships on a regular basis to establish how they can be improved and maintained.