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Top e-government news, updated daily, and regular features from the top people in the public sector.
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| PFI payments to be guided by tenants’ satisfaction |
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Low levels of tenant satisfaction could trigger lower payments for contractors delivering housing private finance initiatives.
New guidance from the Treasury, issued with last week's Budget, said there should be a greater emphasis on service users' satisfaction in future PFI schemes.
The document said the government would 'seek to create an acceptable mechanism for linking user satisfaction with payment under future PFI contracts to align the incentives of service providers more closely with user expectations'.
Ian Perry, chief executive of Harvest Housing Group, which is a member of the consortium that holds the Grove Village PFI contract in Manchester, welcomed the Treasury's move to make tenant satisfaction a central part of contract delivery.
'Tenant satisfaction is a key indicator of the success of a scheme in the community,' he said.
Housing PFI needed to shift its focus to what the outcomes are in the community, he said.
Contractors should not fear being held to account by tenants, he added. 'If they don't like it, they shouldn't be in it.'
But Iain Craven, assistant director, project finance at Ernst & Young, said contractors would want objective measures of performance on tenant satisfaction if it could hit their payments.
'They could be meeting their performance objectives 100 per cent but the tenants are still not satisfied,' he said. The guidance also said tenants should be involved long before projects went live, with opportunities for extensive consultation at the procurement stage.
Jeff Zitron, a director at consultants Tribal HCH, said tenants would have to be brought on board as projects were put together.
'It will encourage contractors to be more engaged with tenants during the procurement process,' he said.
The document said the government would also set up an operational task force to provide support to councils running contracts.
Large projects could also face greater scrutiny, it warned. Some schemes would be subject to additional review at an earlier stage by the cross-departmental project review group.
Zitron questioned whether large projects needed more scrutiny. 'If you talk to anybody who has done a PFI scheme I do not think they would say there was a lack of scrutiny,' he said.
Meanwhile, six councils have been drawing up proposals for bids for the fifth round of housing PFI. The deadline for submissions was today.
Salford, Leeds, North Tyneside, and Barking & Dagenham councils were set to put in bids for housing revenue account schemes. Guildford and Stoke are planning non-HRA schemes.
Leeds Council's project involves work on almost 1,200 homes in a mixture of refurbishment and remodelling and the building of an additional 200 homes. The council would be seeking PFI credits from government of around £89 million. |
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