Auditors criticise management of local PFI waste schemes

16 Jun 14
The management of three local authority-led Private Finance Initiative waste projects has been criticised by government auditors for a lack of clarity.

The National Audit Office examined the contract oversight provided by the Department for Environment, Food and Rural Affairs in PFI contracts entered into and managed by Surrey County Council, Norfolk County Council and, jointly, by Herefordshire and Worcestershire County Council.

All three sit under Defra’s Waste Infrastructure Delivery Programme, which provides support, guidance and funding to councils undertaking waste projects through PFI. The programme oversees the allocation of £1.7bn in waste infrastructure credits to 28 local authorities in England, effectively funding councils directly for a portion of the costs it has to pay its contractor.

Auditors found that all three projects had been plagued by significant delays because of difficulties obtaining planning permission, complex commercial considerations, opposition from local groups and uncertainty over technology.

‘It was clear from correspondence received by the NAO that there was a lack of clarity over both the facts and figures relating to these three projects, and the roles and responsibilities of the parties involved,’ the watchdog said.

It concluded that Defra had given good support and guidance to the local authorities involved, but that the nature of its funding agreements with Surrey and Herefordshire and Worcestershire made it difficult for it to withdraw or amend its financial support, even when significant infrastructure had not been delivered as planned.

The report makes no judgements about the value for money provided by the three contracts as this is a matter for the local authorities’ auditors. Nor does it examine the value for money provided by Defra’s Waste Infrastructure Delivery Programme.

Its findings will form the basis of a Public Accounts Committee hearing.


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