UPDATE. UK National Infrastructure Plan 2011 and Call for comments on PFI

Date December 04, 2011
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UPDATE. UK National Infrastructure Plan 2011 and Call for comments on PFI The UK Government is taking a fundamentally new approach to coordinating public and private investment in UK infrastructure. The Government prioritised PFI in the last years and it will continue giving preference to private investment in infrastructure.
 
However, the Government has signed a Memorandum of Understanding with two groups of UK pension/infrastructure funds (including the National Association of Pension Funds and the Pension Protection Fund, and a separate group representing pension plans and infrastructure fund managers) to support additional investment in UK infrastructure.Pension funds are "hungry" to invest in stable long-term, inflation-linked infrastructure process. In addition,  the government believes that allowing pension/infrastructure funds to invest directly into infrastructure could be a better value for money proposition than executing PFI transactions.
This radical and different approach to infrastructure investment still has to be worked out but it seems like not everybody is going to like it.Other ideas from the 2011 Plan are the following:
  • exploring new sources of revenue to support investment. It will explore innovative ways of financing  including tolls, which will also be investigated for other new capacity proposals.
  • allowing local authorities more flexibility to support major infrastructure.
  • using guarantees when investors cannot accommodate certain risks.
£250bn investment in infrastructure is planned beyond 2015. The NIP identifies over 500 infrastructure projects that the Government wants to see built over the next decade.The NIP also sets out 40 high priority infrastructure investments.
See the UK NIP 2011.In addition to this, we have a report that The Infrastructure Forum has prepared to review the lessons learned from the PFI experience in the UK (November 2011). It's a good read, we recommend it.All these reports and many more can be found at InfraPPP Reports.UPDATE:- PFI reform: Call for evidence
  • Issued: 01 December 2011
  • Open date: 01 December 2011
  • Close date: 10 February 2012
On the 15 November 2011 the Government's intention to reform the Private Finance Initiative (PFI) was announced by the Chancellor. The Government intends to conduct a broad based engagement process and is now inviting all interested parties to respond to a call for evidence on the reform of PFI and to bring forward proposals for a new approach to using the private sector in the delivery of public assets and services.
In particular feedback is sought from industry participants with an active role in the delivery and operation of public facilities, from those with an interest in investing in these projects, as well as from across the public sector, academics, think tanks, employees and wider stakeholders.
Allen Overy has published very quickly after the release of the National Infrastructure Plan a report called: An analysis of the UK National commenting the mentioned Plan.
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