PFI Assurance Issue:

9. Financing structure, availability of finance & Special Purpose Vehicle (SPV) robustness

…to provide assurance that the PFI contract will be (or continues to be) achievable where the private finance is demonstrably available, structured in a cost effective way and the SPV is demonstrably robust, in accordance with mandated policy and best practice.

Commercial/Financial Assurance Guide Ref:

DE&S Commercial Assurance Guidance & DE&S Finance Instruction: n/a

Relevant MOD policy/guidance used as measure for assurance:

Relevant external policy/guidance used as measure for assurance:

• MOD PFU Guidance Note - MOD Standard Project Agreement v1 for PFI Projects

• MOD PFU Guidance Note - Refinancing of PFI Projects

• [MOD PFU Guidance Note - Financing PFI Projects]34

• MOD PFU Guidance Note - Preparing the Invitation to Negotiate for PFI Projects

• HM Treasury: Standardisation of PFI contracts (SoPC) Version 4

• HMT Guidance: Preferred Bidder Debt Funding Competitions - draft outline guidance for feedback

• HMT Guidance: Refinancing of Early PFI Transactions - Code of Conduct

• HMT Guidance Note: Calculation of the Authority's Share of a Refinancing Gain

• HMT Covering Note: Value for Money in Refinancings

• HMT Application Note: Value for Money in Refinancings

Evidence Required for each Procurement Phase

Up to Initial Gate:

Up to Market Engagement:

Up to close dialogue and Preferred Bidder appointment:

Up to Main Gate:

Up to Contract Award:

Post Contract Award35:

• Market sounding results/report (Market analysis)

• ITN/ITT
(instructions to bidders)

• Financial advisors letter of support confirming the contract is bankable, appropriately/efficiently structured and robust

• Plans for a funding
competition

• Plans for Parent Company Guarantees and/or Collateral Warranties

• Financial advisors tender evaluation report

• Financial advisors letter of support confirming the contract is bankable, appropriately/efficiently structured and robust

• Bidders proposals (incl term sheets, finance documents, funder letters of support)

• Parent Company Guarantees and/or Collateral Warranties

• Evidence/results/plans for Refinancing

• Evidence of SPV change of control/ownership

• Evidence of change of key sub-contractors

• Evidence of call on Parent Company Guarantees and/or Collateral Warranties

• Plans for a funding competition

• Evidence of & results from funding competition