2.56 In MOD's final comparison before closing the deal Modus' price of £746.1 million was in the middle of the range of possible costs that MOD estimated would have arisen under conventional procurement. Recognising the uncertainties in the cost comparison, particularly in respect of the estimated costs of the project using conventional procurement, MOD concluded that the comparison demonstrated that, in broad financial terms, the PFI deal would cost equivalent to conventional procurement.
2.57 MOD also considered that the PFI solution would deliver overall value for money because, the costs being equivalent to conventional procurement, it would deliver the same benefits as the original business case for the project, and other factors tipped the balance in favour of PFI. The contractor would be incentivised to complete on time, the PFI cost was more certain than the possible cost outcomes under conventional procurement and there would be specified service standards with payment deductions for poor performance.