12 July 2002
The MPs concluded that too many organisations fail to monitor properly the quality and value-for-money of PFI projects after they have signed contracts. They found that only half of the 121 projects examined had proper monitoring systems in place for the lifetime of the contracts.
More than one in five bodies said the value-for-money of their contracts had diminished over time.
MPs said that contractors' equity investment must be tied to results, so that risks and rewards are commensurate with their performance. 'It will undermine an essential commercial discipline if contractors generally are given the impression that the government will always bail them out,' the report added.
The committee also said staff responsible for managing PFI projects must be given adequate training, and called on the Office of Government Commerce to 'plug the gaps' in its guidance. This is crucial to protect the £100bn of public funds already committed to PFI projects, the MPs said.
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