05 September 2008
A Public Accounts Committee attack on the management of Private Finance Initiative projects has sparked more opposition to the schemes from unions and doctors' leaders.
In a report published on September 2, HM Treasury: making changes in operational PFI projects, the PAC found that many public sector managers did not have the commercial expertise required to oversee multimillion pound projects over a long period.
The MPs said up to 15% of projects were not being managed on a full-time basis and too few changes were being put out to tender. They called on the Treasury to improve training for managers and provide greater central support.
Reacting to the report, Jonathan Fielden, chair of the British Medical Association's consultants committee, said: 'The PFI has proved a long-term millstone around the neck of the NHS. It is time for the NHS to move away from this detrimental funding system towards one that is more cost-effective and allows vital funds to get to patients.'
Public sector union Unison also renewed its attack on the use of the PFI. General secretary Dave Prentis said: 'It is no good pointing the finger of blame at contract managers when the whole PFI system is fundamentally flawed. It is a failed policy and should be abandoned.'
A recent survey by the National Audit Office found that a third of contract managers at PFI hospitals and one in six contract managers of PFI schools described their teams as under-resourced.
PAC chair Edward Leigh said: 'This is particularly worrying where changes are being made to the services and assets provided, at a cost to the taxpayer in 2006 of £180m. Public sector authorities must keep the incumbent private sector contractors on their toes by, wherever appropriate, making proposed changes costing over £100,000 subject to competition.'
The authorities, he added, should refuse demands by the private sector to pay unjustified additional fees for processing change requests. And the public sector needed centrally provided guidance on what prices were reasonable for common minor changes to projects.
Currently, there are more than 500 operational projects with a combined capital value of £57bn. Future payments amount to £181bn (a present value of £100bn).
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