Preparing for PFI contract expiry: what contracting authorities need to know

The Infrastructure and Projects Authority (IPA) recently published its practical guidance, Preparing for PFI Contract Expiry. Its aim is to provide practical support to the public sector on managing the expiry of PFI contracts. The new guidance recommends that contracting authorities commence planning for PFI expiry “at least seven years prior to the contract end”.

A number of projects will start expiring over the next few years, which gives rise to two fundamental questions: (i) in what condition should the PFI asset, such as a major acute hospital be handed back to the public sector; and (ii) what will the services such as cleaning, catering, and building maintenance look like in respect of that asset on day one after handback and contract expiry?

The IPA’s guidance will help facilitate the required conversations in preparing for expiry, including asset handback and the transition to future services provision, writes Mark Hanlon in his latest article.

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