PFI delivers projects on time and to budget, says NAO

Private finance initiative projects are mostly delivered on time and to budget, according to a report issued by the National Audit Office (NAO).

A total of 37 central governemnt PFI projects were analysed by the NAO, including 11 hospitals, seven prisons, seven roads and other schemes such as office accommodation and training facilites. Under 22% had exceeded cost and only 24% were delivered late (only 8% were later than a fortnight).

Both figures are massive improvements upon the NAO's last analysis of public sector procurement in 1999; then 73% of projects went over-budget and 70% were delivered late.

Only two projects due to be completed by summer 2002 were unfinished at the time of the census; one has since been completed and the other is the much-delayed National Physical Laboratory at Teddington.

The NAO found that most public sector managers were satisfied with the design and construction and performance of their PFI projects. The NAO recommends the government should make greater use of user surveys in the future.

The NAO also stated that it is not possible to judge whether the favourable construction performance shown by PFI projects could have been achieved using other procurement routes. The NAO recommends government departments should investigate how improved performance could be achieved through traditional procurement routes.