A.8 The majority of respondents to the call for evidence expressed the view that the private sector should have a role in the delivery of public sector assets. Respondents stated that this was due to a number of factors, such as the skills and experience the private sector brings to projects, commercial rigour and due diligence, as well as risk transfer and innovation.
A.9 Some respondents did say however that the private sector should not have a role in sectors such as ICT, defence, politically sensitive areas and front line service delivery.
A.10 A number of respondents proposed other delivery, procurement and financing models used to deliver public infrastructure in the UK and internationally as a means of addressing some of the perceived issues associated with PFI. These included the regulated asset base approach, joint ventures, Local Improvement Finance Trusts (LIFT), Non Profit Distributing model (NPD), Local Asset Backed Vehicles (LABV), institutional leases, charitable trusts, alliancing, Tax Increment Financing (TIF) and conventional procurement. Key features of these alternative models included their partnership based approach, regulation of equity returns, transparency, better flexibility and risk allocation, attractiveness to institutional investors and speed of procurement.
A.11 Respondents did, however, suggest a wide range of features of the PFI model that should be retained. These included the incentives to ensure good project performance, the transfer of construction and operation risk to the private sector, the provision for lifecycle maintenance and the focus on whole life costing, as well as the standardisation of contracts.
A.12 When considering how the use of private finance should be evaluated when considering the appropriate procurement route for a project, respondents suggested that, as is the case currently, the use of private finance should be evaluated on the basis of value for money. Other considerations raised by respondents included a project's sustainability, the environmental and social impacts and the certainty over the time and costs involved.