11. All PFI Projects in procurement are required to adopt this drafting in their contracts.
12. MOD PFU recommends that all operational PFI Projects adopt this drafting in their contracts, where this would be of benefit. The advantages of doing this are that the Change process should be more efficient, ensuring cost and time saving on the part of both parties, and that good relations can be maintained in the partnership8. It should also ensure that the MOD has the best chance of achieving value for money ("VfM") through life and that this can be demonstrated transparently to external stakeholders, such as HM Treasury.
13. It may be possible to agree a new approach to the Change drafting at key points in the deal, such as during any negotiations over the terms of a major change to the project, a market test/benchmarking exercise, a VfM review or a refinancing. At such key stages, other stakeholders in the deal (such as sub-contractors and funders) are likely to be involved and these parties can consider the new Change process drafting at the same time. This is likely to be a more economical approach than agreeing a variation to the contractual drafting on Change in isolation.
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8 In the Report by the Comptroller and Auditor General HC 205 Session 2007-2008, dated 14 January 2008, page 19 para. 2.26, it was noted that "both public and private sector contract managers believe that efficiencies can be made." This suggests that the private sector, too, is frustrated by the existing processes for Change on PFI Projects.