PFI Hospitals. Remember them?

After a hiatus caused by the NHS’ money problems, the first of a new wave of schemes is about to come to the market. The £374m Bristol North PFI is also the first to have a little genetic engineering from Partnerships UK, which has taken into account last year’s Treasury white paper. It won’t be tendered with catering and cleaning – the so-called soft services – as part of the package. And generic designs for rooms will be drawn up before it goes out to tender, a variant of “smart PFI”. It’s also the first big hospital to adhere to the EU procurement rules that force at least two bidders to go to the wire.

This “competitive dialogue” process sounds rather cuddly and co-operative, but in reality it’s no such thing. It does away with the step of appointing a preferred bidder that the trust then negotiates with. Instead, the contenders work up fairly detailed designs and base their final price on them. For a hospital the size of Bristol, it’s thought that that will raise bid costs to about £5m. Although PFI hospital work is hard to come by, contractors’ PFI teams are still busy on Building School for the Future, and there’s plenty of other work around. Bristol is contemplating reimbursing some costs to get three contenders to go the full way. It will need to. Betting £5m when you’re twice as likely to lose as win surely makes no sense, even for the hungriest PFI specialist.

So it all comes down to money

Time for a reality check. As we said last week, all the new ideas, initiatives and chatter about cutting carbon can fool us into thinking we’re making more progress than we truly are. A survey we carried out in conjunction with Corenet, which represents 500 of the biggest landlords and tenants in Britain, underlines just this point. The results, which will be presented at our Think conference next week, reveal just how hard it will be to meet one crucial target, that of cutting energy use in existing office buildings.

The main reason for not making improvements was cost (42%), followed by the landlord–tenant divide (30%). But perhaps the most disappointing finding was that energy performance certificates – the washing machine-style energy labels that come into force next April – will have no impact on 75% of occupiers.

This particular finding raises a number of questions. For example, if energy labelling doesn’t change behaviour, then what will? Large corporations are increasingly pledging to become carbon neutral, but how do they think they’re going to do that if they’re not prepared to pay to upgrade their offices?

The survey is clear that financial incentives, particularly reduced business rates, would be the best drivers for change. The reality, though, is that tougher regulation would be more pain for business, but less pain for the Treasury.