The success of the PPPs depends to a large extent on the development of an effective performance incentive regime, which is challenging. It is therefore sensible, where possible and as in this case, to have a period of trial operation (or shadow running) to review arrangements and iron out problems. Typically, not all aspects of a regime can be fully tested ahead of time, and ongoing review is desirable. Within the Tube PPP framework, a review is anticipated at the 7½ year mark.
In introducing new performance regimes, departments should ensure that they take as full account as possible of the effectiveness of different PFI/PPP performance regimes up front. Departments should also conduct ongoing reviews of the effectiveness of the regime, including an independent audit at least one year in, on which basis changes should be made to the regime where possible. (Report reference: A1-A4 and B3) |