1.5 At financial close, the Home Office and Prison Service occupied three leasehold and three freehold buildings in central London. Details of their condition, size and the number of staff accommodated are provided in Figure 2. The design and internal layout of the buildings is inflexible and most are in poor condition. In particular, Queen Anne's Gate requires refurbishment of both the plant and internal services and there are potential problems with the external building fabric. A 1993 study by the former Government accommodation department, Property Holdings, concluded that Horseferry House was incapable of future economic occupation. Although they are in better condition, the Home Office has calculated that Abell, Cleland and Clive House require some £28 million of work over the next thirty years. Grenadier House is a more modern building in better condition.
1.6 Figure 3 shows that the Home Office will be paying about £6 million more per annum for its new accommodation under PFI than it had been paying for the existing estate at financial close in 2002. However, it considers that it will be worth paying more in return for greatly improved quality accommodation and new facilities. Furthermore, the annual cost of owning, operating and maintaining the existing estate is rising as a result of its condition and other factors, and are now estimated to be £45 million. Funding for essential repair and maintenance would have been expected to add substantially to the cost of running the existing estate in subsequent years.