The Audit Commission this week joined in the onslaught on the PFI, claiming in a report that some projects took too long and were too complex.
The commission said the process of negotiating with a preferred bidder was long-winded and took up too much senior management time. It recommended that the whole process take no more than nine months for big projects and six for smaller ones.

The report noted that the negotiation of PFI contracts usually took from 12 months to two years and that a PFI project was likely to take at least three to four years to come into operation.

The commission concluded that savings on capital costs were uneven. In an analysis of eight schemes, it found that one school refurbishment, worth £130m, had predicted savings of 17% while smaller schemes had claimed that they would save only 3-5%.

The report says: "While the PFI can generate significant predicted savings, it is not guaranteed." However, it adds that if a PFI project is approached in the "right spirit", it can deliver facilities and services that provide value for money.

While the PFI can generate significant predicted savings, it is not guaranteed

Audit Commission report

The report, entitled Building for the Future, makes it clear that it is simply dealing with the practical issues raised by PFI, and neither endorses nor questions the assumptions that underpin the procurement policy.

It notes that if PFI is to deliver value for money, the higher costs of private finance and the level of return demanded by the private sector must be outweighed by lower design, construction, management and operating costs.

The commission's comments comes hard on the heels of a paper by centre-left think tank the Institute of Public Policy Research. This recommended that the government should sometimes use different forms of procurement.