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Official Report: search what was said in Parliament

The Official Report is a written record of public meetings of the Parliament and committees.  

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Dates of parliamentary sessions
  1. Session 1: 12 May 1999 to 31 March 2003
  2. Session 2: 7 May 2003 to 2 April 2007
  3. Session 3: 9 May 2007 to 22 March 2011
  4. Session 4: 11 May 2011 to 23 March 2016
  5. Session 5: 12 May 2016 to 5 May 2021
  6. Current session: 12 May 2021 to 14 May 2025
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Displaying 3102 contributions

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Public Audit Committee

Expiring Private Finance Initiative Contracts

Meeting date: 6 June 2024

Richard Leonard

It would be useful for the committee if you could give us the comparison of the overall cost under the old model and the overall running cost under the new model, so that we can get an understanding about whether a transfer from a PFI-style contract into an in-house arrangement costs more or is about even. It may vary from situation to situation. Mr Rennick also has responsibility for schools, for example, so it may be that these issues are not so acute in other parts of the public sector where PFI transitions are likely to take place.

I also have one other issue to raise with you. For the record, Teresa Medhurst, are you saying that, on 1 December, there will be a big bang and that is when everybody in HMP Kilmarnock will move over to the SPS’ terms and conditions, or is there a period leading up to 1 December in which different cohorts will transfer to the new terms and conditions under the new contract?

Public Audit Committee

Expiring Private Finance Initiative Contracts

Meeting date: 6 June 2024

Richard Leonard

We have the chief executive of NHS Scotland coming before the committee before we break for summer recess, so we could consider the issue then.

My parting question is around lessons learned. Teresa Medhurst, I know that you and your colleagues are still in the middle of the transition but, even at this early stage, do you think that there are things that you might have done differently? Lorraine Roughan, when you go to Kerry Alexander’s collaborative workshops and share your experience, what are the dos and don’ts that you would take to that kind of get together?

Public Audit Committee

Expiring Private Finance Initiative Contracts

Meeting date: 6 June 2024

Richard Leonard

That is very insightful. Does anyone else want to come in with lessons learned, or things that we can do in relation to future examples of PFI expiries?

Public Audit Committee

Expiring Private Finance Initiative Contracts

Meeting date: 6 June 2024

Richard Leonard

We are in the middle of a general election campaign, Mr Reekie, so who knows what the future might hold.

I thank our witnesses this morning for their input. It has been very useful to us and the committee will have a continuing interest in this area, so I thank you for giving us some of those introductory lessons. We may go on to future phases of analysis and audit in the area, and I am sure that the Auditor General will be taking some notes from this morning’s session, too.

I now move the meeting into private session.

10:40 Meeting continued in private until 11:11.  

Public Audit Committee

Expiring Private Finance Initiative Contracts

Meeting date: 6 June 2024

Richard Leonard

My final question is for Mr Rennick. Looking at the scale of all this, I think that the total value of these contracts is £9 billion and that around half of that is in schools, is it not, which is your responsibility?

Public Audit Committee

Expiring Private Finance Initiative Contracts

Meeting date: 6 June 2024

Richard Leonard

Do you have any sense of when demand will be greatest on the capacity of that part of the public sector that you have oversight of?

Public Audit Committee

Expiring Private Finance Initiative Contracts

Meeting date: 6 June 2024

Richard Leonard

That is helpful. I am conscious of the fact that, the last time he was here, Mr Reekie told us that there are only three people in the team looking at PFIs, so I recognise that there might be some capacity issues. However, if you could supply us with that information, that would be helpful.

In a similar vein, is retendering an option in any of these cases? That is probably more a question for Mr Rennick. Do you look at a range of options in the lead-up to the expiry of one of those PFI contracts? We rehearsed the issue a little bit in relation to the Serco contract at Kilmarnock, but in more general terms, wearing your value-for-money hat, is that a consideration?

Public Audit Committee

Expiring Private Finance Initiative Contracts

Meeting date: 6 June 2024

Richard Leonard

Thank you. I am conscious of the time and I know that two other members of the committee want to come in with some questions. I will turn to the deputy convener first and then I will bring Mr Simpson in.

Public Audit Committee

Expiring Private Finance Initiative Contracts

Meeting date: 6 June 2024

Richard Leonard

I am sorry to repeat myself, but I presume that you are the accountable officer who is responsible for the economy, efficiency and effectiveness of processes including these and their outcomes.

Public Audit Committee

Expiring Private Finance Initiative Contracts

Meeting date: 6 June 2024

Richard Leonard

I am struggling a little bit to understand why you could not have got the Serco staff on to those superior terms and conditions at a much earlier point. Why are they having to wait until December?