PFI Compliance

The Public Sector has an absolute right to understand if any contract it has let is performing well and according to contract. While most PFI/PPP contracts have an expectation of self-monitoring, this expectation does not remove the public sector’s need to confirm the accuracy of this data, and so to assure itself of the adequacy of performance.

PFI Compliance has a long history in independent audit, and our studies have ranged over many subjects:

• FM ‘hard’ and ‘soft’ services;
• Management responsibilities;
• Statutory compliance;
• Accuracy of reportage;
• Health & Safety.

Audits tend to be of most value if they are undertaken relatively openly, and so that any Provider is aware of the exercise and the need for it. While the terms of any audit do tend to be confidential to the client, once the Audit Report has been published the document becomes open to all with an interest in the subject. Transparency of approach, and of why opinions might be formed (‘pass/fail’ for example) are an integral part of any successful Audit, so that all affected by its outcomes can more readily accept its findings.

Audits are meant to be constructive, in the sense that they seek to provide perfect clarity on any matter of concern. While any private-sector partner may not welcome an Audit, they are compelled to be open-book with their public sector clients, and should ultimately feel the benefits of the process through greater Client trust, greater clarity of operations, and an agreed clear way forward (if any matters do require alteration).

HM Treasury, in their March 2006 Report on ‘PFI – Strengthening Long Term Relationships’ recognised the need for long-term monitoring of PFI/PPP Contracts (a link to this report is contained in this website). As PFI Contracts mature, it has become a recognised Treasury requirement that the public sector understands how well a Contract is performing through regular monitoring, and so is in a position to instigate timely measures for change.

We feel strongly that the public sector has a ‘right to know’, and that a long-term Contract increases that need. While any PFI/PPP Contract may be perceived to be performing well, independent confirmation of that perception is important. If a Contract is perceived to be performing less well, Audit can identify very clearly areas requiring improvement.