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Procurement of the M25 private finance contract

Procurement of the M25 private finance contract
Author: Great Britain: National Audit Office
Publisher: The Stationery Office
Total Pages: 44
Release: 2010-11-19
Genre: Business & Economics
ISBN: 9780102965544

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The slowness with which the Highways Agency's PFI contract to widen the M25 was taken forward resulted in higher financing costs in the credit crisis. Moreover, the Agency was slow to investigate a potentially cheaper alternative to widening. An 18-month delay in preparing and finalizing the widening procurement meant that the contract was let in May 2009 at the height of the credit crisis. This increased the net present cost of the deal by £660 million (24 per cent) to £3.4 billion. The case for PFI was less convincing than the Agency thought owing to shortcomings in its cost estimation process. The Government had announced in 2003 its intention to reduce congestion on the M25. The Agency was starting to carry out trials at that time of an alternative, potentially cheaper solution of hard shoulder running (allowing drivers to use the hard shoulder at times of peak congestion), first tested in Europe in 1996. The NAO estimates the savings from a conventionally procured hard shoulder running solution might range between £400 million and £1.1 billion. The Agency, however, doubted the technique's suitability for one of the sections of the M25 being widened which has high traffic flow and whether operation and maintenance savings could be achieved through conventional procurement


M25 private finance contract

M25 private finance contract
Author: Great Britain: Parliament: House of Commons: Committee of Public Accounts
Publisher: The Stationery Office
Total Pages: 48
Release: 2011-02-08
Genre: Business & Economics
ISBN: 9780215556332

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In May 2009 the Highways Agency signed a 30 year private finance contract for widening two sections of the M25 motorway, including the Dartford Crossing, and maintaining the entire 125 mile length of the road, and 125 miles of connecting roads and motorways. The Committee makes eight points in conclusion of its review of the contract: they do not agree that the PFI contract represents value for money; the £80 million spent on consultants over six years for this project was excessive; the Agency lacks the capacity to assess whether its advisers are providing value for money; the Agency significantly over-estimated the market rate for operation and maintenance; the invitation to tender was too narrowly drawn as it excluded hard should running as a solution for traffic congestion; the Agency persisted with its preferred solution of widening the M25 because of the time taken to trial hard shoulder running; the Agency appeared to be committed to a single procurement route & justified a widening deal through a flawed and biased cost estimation; evidence could not be taken from the Senior Responsible Owner of the project as he had left the Agency and was employed by one of the project's major contractors and investors. Ultimately the Committee believe that the project was mishandled at a potential extra cost to the taxpayer of around £1 billion


Public–Private Partnerships and the Law

Public–Private Partnerships and the Law
Author: Yseult Marique
Publisher: Edward Elgar Publishing
Total Pages: 329
Release: 2014-08-30
Genre: Business & Economics
ISBN: 1781004552

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This timely book examines the legal regulation of Public_Private Partnerships (PPPs) and provides a systematic overview of PPPs and their functions. It covers both the contractual relationships between public and private actors and the relationships be


Treasury minutes on the nineteenth to the twenty first and the twenty third to the twenty seventh reports from the Committee of Public Accounts session 2010-11

Treasury minutes on the nineteenth to the twenty first and the twenty third to the twenty seventh reports from the Committee of Public Accounts session 2010-11
Author: Great Britain: H.M. Treasury
Publisher: The Stationery Office
Total Pages: 56
Release: 2011-05-16
Genre: Political Science
ISBN: 9780101806923

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Dated May 2011. The reports published as HC 651 (ISBN 9780215556232); HC 688 (ISBN 9780215556363); HC 721 (ISBN 9780215556424); HC 687 (ISBN 9780215556530); HC 667 (ISBN 9780215556646); HC 668 (ISBN 9780215556745); HC 741 (ISBN 9780215556851); HC 765 (ISBN 9780215556882)


State-led Privatisation and the Demise of the Democratic State

State-led Privatisation and the Demise of the Democratic State
Author: Mike Raco
Publisher: Routledge
Total Pages: 239
Release: 2016-04-01
Genre: Political Science
ISBN: 1317050223

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For decades now we have been told that we are living through a governance revolution. Gone are the days when government agencies and bureaucrats told us what to do and how to do it. We are no longer clients of the state but empowered citizens who are able to take greater control over our own lives and the activities of those who govern in our name. Across the world the prevailing narrative has become one of Good Governance, devolution, liberation, and freedom of expression. In policy fields as diverse as development planning, healthcare, and public transport a neo-pluralist rhetoric has emerged based on the principles of ’co-production’ and partnership working. And yet at the same time a curious paradox is emerging. Whilst the prevailing zeitgeist is one of openness and citizen empowerment, this book will show that in reality new modes of governance are emerging in which state controls have actually been expanded into many spheres of life that were previously left unregulated. For some a new political economy of ’regulatory capitalism’ has emerged and this, in turn, has ushered in unprecedented forms of state-led privatisation under which democratically-elected politicians have voluntarily handed over their powers, responsibilities, and resources to new corporate elites who promise to deliver services in more efficient and equitable ways. As the discussion will show, in reality the rhetoric of Good Governance has, therefore, been used to legitimate the wholesale transfer of welfare assets and services beyond the democratic control of state actors and the citizens that they represent. Privatisation has become a new utopianism that involves a revolution in ways of thinking about democracy, governance, and urban management, the implications of which will be felt by current and future generations.


Public Sector Management

Public Sector Management
Author: Norman Flynn
Publisher: SAGE
Total Pages: 297
Release: 2012-04-05
Genre: Political Science
ISBN: 085702874X

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The highly-anticipated Sixth Edition of Norman Flynn’s Public Sector Management continues to provide students with an insightful, jargon-free description, analysis and critique of the management of the public sector by the UK government. New companion website with free access to full-text journal articles, policy documents, links to useful websites, and relevant multimedia and social media resources, as well as additional case studies and discussion questions. www.sagepub.co.uk/flynn.


Lessons from PFI and other projects

Lessons from PFI and other projects
Author: Great Britain: National Audit Office
Publisher: The Stationery Office
Total Pages: 36
Release: 2011-04-28
Genre: Business & Economics
ISBN: 9780102969672

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Lessons from the experience of using PFI can be applied to improve other forms of procurement and help Government achieve its aim of securing annual infrastructure delivery cost savings of £2 billion to £3 billion. To secure the best value for money from all types of procurement, the public sector needs to develop skills the NAO has identified. These are collecting better data to inform decision-making; ensuring projects have the right skills; establishing effective arrangements to test, challenge and, if necessary, stop projects; and using commercial awareness to obtain better deals. The case for using private finance in public procurement needs to be challenged more. Also, privately financed projects will often still be off balance-sheet which may continue to act as an incentive to use PFI. There has not been a systematic value for money evaluation of operational PFI projects by departments. So there is insufficient data to demonstrate whether the use of private finance has led to better or worse value for money than other forms of procurement. The Treasury and departments should identify alternative methods for delivering infrastructure and related facilities services to maximise value for money for government. The NAO welcomes the current plans of the Treasury and Cabinet Office to strengthen project assurance. The report highlights the need for independent challenge capable of stopping projects which do not give the prospect of value for money. This is particularly important as there is still a shortage of the skills needed to manage and oversee complex major projects.


Planning Economic Infrastructure

Planning Economic Infrastructure
Author: Great Britain: National Audit Office
Publisher: The Stationery Office
Total Pages: 44
Release: 2013-01-16
Genre: Business & Economics
ISBN: 9780102980486

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Large-scale infrastructure projects, in sectors such as energy, rail, roads, water, waste, flood defences and digital communications, pose significant challenges. With limited funds available, the government is looking to private companies to wholly own and finance around 64 per cent of the £310 billion expected cost by 2015, with the burden of funding likely to shift towards the public as consumers rather than taxpayers. The first of the risks to achieving value for money is that forecasters might get wrong the need for infrastructure in the long term. Secondly, uncertainty over government policy might lead to deferment or abandonment of projects in the UK for opportunities elsewhere. Thirdly, there is the possibility of a failure to take into account the cumulative impact on consumers. Increasing the burden on consumers may increase the risk of financial hardship, or the need for unplanned taxpayer support. The full impact of spending on economic infrastructure in the years ahead is unclear. While there is information on individual sectors, no overall assessment has been undertaken by government. Taxpayers may be exposed to substantial losses as a result of government guarantees to bear some project risks should they materialize. The NAO has made a series of recommendations to help ensure value for money is achieved. It calls for the Treasury to work with departments and regulators to provide greater clarity for consumers regarding the financial impact of planned infrastructure investment. Where there are limits on affordability and availability of finance, the NAO notes that the Treasury and departments may need to refine their prioritization of infrastructure programmes and projects.


ITF Roundtable Reports Ex-Post Assessment of Transport Investments and Policy Interventions

ITF Roundtable Reports Ex-Post Assessment of Transport Investments and Policy Interventions
Author: International Transport Forum
Publisher: OECD Publishing
Total Pages: 132
Release: 2017-02-28
Genre:
ISBN: 9282108155

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Ex-post evaluation is important to improving the delivery of transport policy objectives. It can be used for multiple purposes at the core of which is the improvement of ex-ante assessment. A small number of jurisdictions employ ex-post evaluation systematically and leading experience is ...


The procurement of consumables by National Health Service acute and Foundation trusts

The procurement of consumables by National Health Service acute and Foundation trusts
Author: Great Britain: Parliament: House of Commons: Committee of Public Accounts
Publisher: The Stationery Office
Total Pages: 48
Release: 2011-05-20
Genre: Medical
ISBN: 9780215559609

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The 165 NHS acute and Foundation hospital trusts in England spend over £4.6 billion a year on the procurement of medical supplies and other types of consumable goods. Each trust controls its own purchasing and can purchase consumables in various ways: dealing direct with suppliers; through the national supplies organisation, NHS Supply Chain; or via the regional Collaborative Procurement Hubs. They can also choose to join other trusts in collaborative purchasing arrangements for particular localities or types of supplies. The Department sees the future for NHS procurement as a 'pyramid' structure with national, regional and local procurement of different types of goods, as appropriate to the products and the supplier markets. However, this theoretical model does not reflect the current complex reality, with a profusion of bodies involved in the procurement process. Its effectiveness is open to question in the emerging landscape where Foundation Trusts act independently with no explicit incentive to co-operate. The fragmented system of procurement has produced a great deal of waste, with trusts being charged different prices for the same goods, ordering in inefficient ways and failing to control the range of products which they purchase. The NAO has estimated that trusts could save around £500 million annually, 10% of their consumables expenditure, by amalgamating small orders into larger, less frequent ones, rationalising and standardising product choices and striking committed volume deals across multiple trusts. A lack of data has limited progress towards more efficient procurement and there has not been sufficient control over procurement practices.