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PFI Projects

Whatever the issue, Weightmans stands ready to assist you to achieve the best possible outcome for your PFI project. 

There are over 700 PFI projects operational in the UK, and the aggregate annual unitary charge burden of the public sector peaked at £10.3bn in 2016/17. These projects related to a swathe of public infrastructure assets, from schools and streetlights to hospitals and housing. 

Our team has a long track record with PFI. Having first advised on numerous projects when originally procured in the early 2000s, we have more recently acted on a variety of issues arising from operational schemes. These include voluntary terminations, major variations, refinancings, contract interpretation, dispute resolution, and project restructuring. We have particular expertise in the complex insurance cost sharing arrangements that are typical in PFI contracts. 

We have detailed knowledge of the original Treasury SOPC guidance and standard form sector-specific contracts, and we keep fully abreast of ongoing guidance issued periodically by NISTA - indeed, members of our team have been involved in the drafting of some of that guidance. All of which means we can quickly get to the heart of any contractual issue affecting your project and provide the best possible advice. 

How can we help?

  • Contract management – application of payment/performance mechanisms, poor performance issues
  • Contract mechanisms – insurance cost sharing/Joint Insurance Cost Reports, energy consumption risk share arrangements, third party income share arrangements, benchmarking and market testing
  • Major variations
  • Project restructuring and Refinancing
  • Contract interpretation
  • Dispute resolution – negotiation, settlement agreements and project resets, adjudication processes
  • Early termination
  • Expiry planning and handback arrangements

Accolades 

Schools

We advised a Council on a significant dispute relating to insurance premium cost sharing arrangements. Working closely with the Council team and external insurance advisor, Steve Johns advised throughout the adjudication process and drafted all necessary submissions.

The adjudicator found in the Council's favour on all grounds, resulting in an immediate payment to the Council of several hundred thousand pounds and further unquantifiable savings in the future. We are currently advising other authorities on similar matters.

Leisure Centres

We advised a Council on a re-set of its Leisure Centre PFI. The re-set addressed poor performance and asset condition, and the right for the Council to make deductions as a result. We provided support throughout the commercial negotiations and drafted the relevant Deed of Settlement and Variation. We helped the Council secure a significant payment in relation to disputed deductions, commitments from the Project Co. And FM provider to undertake an asset survey condition and deal with any defects, and commitments to improve service provision in a number of areas.


Office accommodation

One of the few voluntary terminations to have been undertaken, we advised the Council on the contractual approach to termination, supported its negotiation of the termination terms and compensation payable, and drafted and negotiated a deed of termination and related documents. We developed a methodology to deal with residual tax liabilities, advised on the TUPE transfer of staff, and managed the close process including exit from the interest rate swap. We also supported the Council on its future plans for the PFI building, advising upon a refurbishment project and lease to a long-term tenant.

Police stations

Advising a police authority on preparations for expiry of its early PFI project, which includes unusual option arrangements relating to reversion of the assets to the authority at the end of the term. In addition to advising on contractual processes and valuation matters, we are also assisting the authority in its consideration of how to employ the PFl assets in future as part of its wider estate planning.

Waste Authority

We have advised a Waste Disposal Authority in relation to its two waste management and treatment PPP contracts over a number of years. During that time, our advice has covered a wide range of matters, including high-value disputes, major variations, a project restructuring, insurance cost sharing arrangements, change in law claims, the application of and variations to payment mechanisms (including deductions for poor performance), and contract interpretation issues. We provide a comprehensive service to the Authority and are confident that over time our advice has helped the Authority save significant sums.

Case studies