1 / 11

PPPs and Health: an NAO perspective David Jackson National Audit Office

PPPs and Health: an NAO perspective David Jackson National Audit Office. Performance evaluation. Getting value for money up to financial close Getting value for money once projects are operational. PFI/PPP : possible advantages and disadvantages. Better delivery Private sector expertise

kalare
Download Presentation

PPPs and Health: an NAO perspective David Jackson National Audit Office

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. PPPs and Health: an NAO perspective David JacksonNational Audit Office

  2. Performance evaluation • Getting value for money up to financial close • Getting value for money once projects are operational

  3. PFI/PPP : possible advantages and disadvantages • Better delivery • Private sector expertise • Integrated whole-life approach • Clearly defined service standards But • Higher financing costs • Locked into long term contract

  4. Signing deals: 4 value for money principles

  5. Some key lessons in making deals Setting Objectives • Clear and stable, taking a strategic view The Process • Maintain competitive tension Selecting the best available deal • Price is important but lowest price is not always best Make sure the deal makes sense • Recognise uncertainties in financial comparisons

  6. Deals in progress: 4 VFM principles

  7. Some key lessons for operational deals Good performance against contract • Shared business objectives, payments systems that incentivise and are well run Satisfying expectations • Good involvement of future users in the planning stageand planning for future changes before signing At least as good as conventional • Right skills and managing the relationship well Wider context • Taking a system view in the business case with realistic assumptions about the broader pattern of service delivery

  8. Financing: pre-deal • Can the project be financed? • Exploration of all financing options • Will sourcing of financing be competitive? • Are funding terms reasonable given the risks? • How may movements in financing rates before closure affect the deal

  9. PRIVATE SECTOR RETURNS FINANCING COSTS RISKS Implementation Operation As service implementation is completed: risks and financing costs decrease  expected private sector returns increase 

  10. Refinancing • Early refinancings at Darent Valley and Norfolk & Norwich generated largeprivate sector gains through increased debt • But more recently very little refinancing activity

  11. Managing the relationship: The key stages • Partnership approach supported by the rightcontractual framework • The right skills are needed at the right time • Make the partnership work in practice

More Related