A growing number of UK PPP/PFI contracts (for the provision of public buildings, infrastructure and other assets) are coming to an end.
Current government guidance (with industry-approved updates likely to be issued soon) is that the parties should start preparing at least seven years before the expiry date – in itself an indication that there is a lot for the parties to do before the contract ends. As ever, there are nuances between delivery structures (vanilla PFI and NHS LIFT), sectors and the project vintage (when it was signed and the standard form or version of guidance that applied).
Given the cliff-edge nature of the fixed expiry date, the public sector needs to plan for "what comes next". What services need to be delivered and by whom (and whether a procurement process and/or a TUPE consultation needs to be run)?
We are helping clients explore how best to prepare for handing back the "keys" – their plan to achieve a compliant handback and what to consider before entering discussions across the different sectors or commissioning surveys. Ignoring any wider changes of policy that may occur, we are supporting clients on their strategy for potential re-procurement opportunities for services immediately following the expiry date.
Our expectation is that the lessons learnt from UK handback will apply to the wave of international PPP projects that are scheduled to expire in the late 2030s onwards.
See further information and our ongoing Insight series on handback-related issues:
- Ten questions contractual parties ask about UK PFI project hand backs
- What procurement questions should contracting parties have in mind when anticipating the expiry of UK PFI contracts?
- What happens to the project company at the expiry of UK PFI contracts? and
- How to get ahead and avoid disputes prior to UK PFI handback
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.