1. The methodology used by the National Audit Office is fundamentally flawed, being based on surveys of informants who have an interest in LIFT schemes.
2. Other than these biased interviews, there is no evaluation of value for money or the factors that underpin it. Specifically:
- There is no comparison of the LIFT proposals against other current or potential financing methods.
- There is no examination of risk transfer despite the unusually high levels of return to equity providers.
- The analysis of the financial models was contracted out to Operis, a PFI/PPP consultancy, and neither the models nor the evaluation are in the report.
- There is strong evidence that affordability (the capacity of the public sector to meet the cost of the unitary charge) may be a problem, but there is no analysis.
As such, the Report marks a new phase in the NAO's problematic shift away from quantitative to qualitative analysis in its evaluation of PFI/PPP projects.
3. The NAO make clear that the new governance structures for the delivery of health and other public services could be problematic, but there is no attempt at evaluation.