Q81 Matthew Hancock: No, but the way that it's financed is obviously very different.
Peter Coates: Well, the financing of hotel service is a revenue cost to the trust.
Q82 Matthew Hancock: So, in the future building programme, have you done a comparison between whether it's better value for money to deliver them through PFI or the public sector?
Peter Coates: Well, we would rely on the NAO Report that points out that, broadly, there's no difference between the two.
Q83 Matthew Hancock: No, but if it's cheaper in some cases to do one and, in other cases, to do another, then even if the average of doing either all PFI or not is the same, you might be able to deliver better value for money. After all, you said earlier that a couple of them were cheaper another way.
Peter Coates: The Report implies that in the round there's not a great deal of difference between outsourcing and doing it in-house at present. That must drive us to the point where we say to trusts that this is clearly a choice for you to make. There's one Trust that's keeping its services out-house and that's Papworth. They outsource all their services already anyway.
Q84 Matthew Hancock: Okay, but it's their choice to make?
Peter Coates: Their choice.
Q85 Stella Creasy: The thing that's interesting to me is what you're learning from contracts that are being negotiated. I actually think the issue of maintenance is a bit of a red herring in this because what it's saying in this Report is that 33% of trusts rate at least one service-including those that you are saying they can renegotiate over five years-as unsatisfactory. So I wonder if you could tell us a little more to begin with about where contracts have been broken and where there has been renegotiation on those services that can be renegotiated, and what you've learnt from that process.
Peter Coates: We don't keep all the details of regular market testings that trusts do because it's totally within their own delegated authority and powers. If they don't want to tell us about those retenders then they needn't. Clearly foundation trusts have no linkings with us at all in the way they operate their hospitals. All I can tell you about is where we are keeping track. We are told in 2010 that the market testings that have happened have all used benchmarking rather than going to the market to evaluate the services. They've all come in more cheaply than the old rate and that's about all we know.
Q86 Stella Creasy: So you have got no examples of external tender, for example, for some of these tenders?
Peter Coates: Not in this year.
Q87 Chair: Can I ask you both some general questions to get this clear? Our job here is to assure the taxpayer that we're getting value for money. If we are to do that we need the data; we need the information. You guys are all reducing your central staffing, so you're going to have fewer to do it. I'll ask Bob Kerslake, to give you a breather. The Report suggests you haven't done it very well in the past, you haven't had the data, you've got a very weak centre in overseeing the PFIs in housing. Can you give an assurance to this Committee that you will have the capability over the next period to both collect the data and make value for money assessments across the piece on PFI?
Sir Bob Kerslake: The short answer to that is yes. I think we've already taken steps to strengthen our knowledge of the process, particularly in procurement and then contract. We've done a baseline assessment of the projects before they go into contract, so we've got a comparison with the operational phase.
Q88 Chair: The Report suggests you haven't, but you're saying you've got enough people at the centre and you've got enough pull on your housing associations and local authorities and ALMOs etc to get from them the data you need for us to be able to say whether or not this is value for money.
Sir Bob Kerslake: As I said earlier I think we absolutely have the data now when we go into contract. The bit we're developing is the operational comparisons once they're in contract. I'd make a couple of points on that. One is that there isn't a local authority in the country that only used PFI, so they themselves have comparative data of other methods.
Q89 Chair: But can we, at the national level, see?
Sir Bob Kerslake: We at the national level can and will capture that information. I believe we've got teams that have got the capacity to do it. We will clearly need local authorities to co-operate in that process, but so far the evidence is that they're willing to do so.
Q90 Chair: Are you in the same position?
Peter Coates: We rely on trusts to buy in the necessary benchmarking data and market tests.