April 30, 2007—Most PFI contracts are making money and delivering profits, according to a survey of 93 private sector contract managers undertaken by KPMG, the professional services firm, in co-operation with the Business Services Association (BSA) on the operational effectiveness of PFI contracts.
The projects covered in this annual survey undertaken by KPMG and the BSA represent a cross sample of almost 800 PFI projects active in the UK.
While there have been improvements in a number of areas since last year’s survey was undertaken, a number of difficult issues remain around the effectiveness of PFI contracts. These include retaining members of the management team, developing more balanced responsibility and greater partnership working across the teams. Other concerns center on new regulations, such as the costs of environmental legislation and tax changes to capital allowances introduced in the 2007 Budget.
The survey also found that user satisfaction surveys are conducted by 71 per cent of so-called ‘hard’ (such as landscaping and vehicle maintenance) services and 83 per cent of ‘soft’ (e.g. catering and cleaning) service contracts, with a variety of methods being employed, including mystery shoppers’ and face-to-face feedback sessions.
In more than 90 percent of cases, hard and soft services are being delivered to an acceptable standard, either always, or most of the time.
According to the survey, the clarity of the PFI contract continues to be an important issue for respondents. Thirty-seven percent of managers refer to their contract at least once a week, 32 percent once a month and 24 percent at once every three months. Seventy-five percent felt that it was reasonably accurate in the services it specified.
For more on the survey, see the BSA Web site.
