Major Contractors Group director Jennie Price said she was also heartened by Denham's final statement of support for the principle of the private finance initiative.
She said: "I think one of the most helpful things is the very positive statement on the PFI and the value for money it can deliver.
"They do not seem to be deterred at all by the National Audit Office report [on the Dartford & Gravesham hospital]. The first deals were never going to be the best for either side, and they seem to appreciate that." She said Denham's suggestion that the department might pilot a PFI format in which three bidders worked to a fixed price rather than two going on to the more advanced position of best and final offer before selection was "very good news".
She said: "If you look at the money that is spent on bringing a project to best and final offer – often up to £1m – half of that is spent at the final stage and could now be saved.
"The trick is to be sure that the three at the shortlisted, fixed-price stage aren't carrying out the same amount of work as the two firms that might have been making best and final offers.
"What will be needed are robust output specifications from trusts, so that contractors can have the certainty to give a fixed price. If the specifications are not good enough, a fixed price cannot be agreed." Price said she was happy with Denham's comments on the flow of deals, commenting that contractors would rather have well-thought projects coming to market than half-baked proposals. But Price said the Treasury's failure to confirm its overall plans for the PFI was casting "a long shadow".
Treasury taskforce chief executive Adrian Montague is due to leave in July, with the rest of his team leaving in October. There is now great uncertainty over central control of the PFI.
Representatives of Sir Robert McAlpine, Taylor Woodrow, Laing, Tarmac and Amec met Priestley to discuss plans to reduce the department's supplier base to increase construction efficiency.
With a conventional spending programme of more than £1bn a year, contractors want NHS Estates to be clear about its procurement routes from the earliest possible stage.