2.17 It is important for the delivery of public services that construction work is completed on time and built assets are ready for use by the time agreed. In PFI projects there are two phases after contract letting: the construction of the asset and then usually a short period of time during which the built asset is made ready for use. For example, a new hospital will need to be equipped before it becomes operational. Sometimes an early delivery can lead to increased costs to the department. In our report on the A74(M)/M74 Motorway in Scotland we found that the road was likely to be delivered early, resulting in a likely cost increase of £7 million. In that case the department estimated that benefits would also increase (HC356, Session 1998-99).
2.18 In 29 of the 37 projects surveyed (78 per cent) construction was completed by the time specified in the contract, and 28 (76 per cent) were ready to use by the contractual deadline. Twelve of these 28 were ready for use slightly early. In all these cases no bonus was paid for early delivery, though early payments were made as the departments were ready to use the asset at the earlier date (Figure 4).