2.14 Most contracts have value testing clauses (benchmarking and market testing) for some services, such as cleaning, to ensure the public sector is paying a fair price. However, this can cause costs to increase as well as decrease. We have previously reported that following value testing the cost of existing facilities management services tended to rise above inflation in PFI hospitals and schools - resulting in higher costs for the public sector. In all these cases the SPV had initially proposed even higher increases.46 The SPV provides the benchmarking data creating a potential for conflict of interest. Public bodies need to collect their own data to prevent price increases occurring without challenge - this can be difficult for public authorities with limited information on prices charged in other projects. Market testing (which involves re-procuring the services) can be a time-consuming and costly exercise for the public sector, and there is no guarantee that new bidders will emerge. There is no central management or monitoring of benchmarking and market testing.
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46 Comptroller and Auditor General, Benchmarking and market testing the ongoing services component of PFI projects, Session 2006-07, HC 453, National Audit Office, June 2007, Figure 15.