PLC Public Sector reports:
The House of Lords Economic Affairs Committee recently announced that it would be conducting an inquiry on the private finance initiative (PFI) and off-balance sheet debt. The Committee has published a list of questions that it hopes the Inquiry will answer and asked for evidence to be submitted by 25 September 2009.
The questions published by the Committee strike a chord with a previous blog post published on this site. Questions such as:
Is there significant risk transfer to the private sector or is it more apparent than real?
and:
Are there realistic alternative roles for private finance than the current PFI-type private finance models?
in particular, follow a similar theme.
If the Inquiry can produce definitive response to each of the 10 questions posed, it should provide an excellent overview of where PFI is, and, more importantly, guidance on which direction public procurement needs to go. Undoubtedly, private sector expertise and some level of private finance will need to play a role. The key is identifying how much and on what basis.
Without wishing to sound pessimistic, providing definitive responses will, at best, be difficult. What may be even more of a challenge, will then be persuading the Government (whether it be Labour or Conservative by the time the Committee reports) that any move away from PFI is necessary.