During the normal operation of the PFI contract, it is important that there is appropriate and professional application of:

► contract management principles

► price performance mechanism

► lifecycle planning

► scheduled maintenance

► reactive repairs

► reviews

► benchmarking

Cosmetically, an asset may appear to be well-maintained. It is important that the public authority is fully aware of the condition of its assets and that the lifecycle and planned maintenance have been undertaken effectively.

To avoid disputes, an early understanding of the true condition of the asset needs to be established well before it is due to be handed back. This is particularly important if the handback processes are not clearly defined or are ambiguous.

The authority should undertake and explore:

► bespoke training on effective contract management

► identification of opportunities for cost savings

► regular benchmarking and market-testing to minimise overspending

► early resolution on performance issues

► application of contractual rights and, where necessary, negotiation

► consideration and implementation of contract variations to ensure that the contract remains current and effective

► opportunities for refinancing gain