Challenges of using PFI in housing

1.13  Housing is a particularly complex PFI sector and has some specific challenges. It is the only sector where the key users of the assets, tenants, have significant rights to make decisions about the asset, for example, refusing improvements or making changes to their homes themselves. In addition, the range of asset types and their underlying condition is much greater than in other sectors.

1.14  PFI uses standardisation to drive efficiencies. Some local authorities perceived that the standardised aspects of PFI conflict with the need for flexibility and requested changes to the standard contract which have to be approved centrally, causing delays. The Department's view, however, is that PFI housing can be quite flexible but local authorities need to work within the guidance to achieve this. The Department has recently updated the standardised documents and guidance.