With an increasing number of Private Finance Initiative (PFI)/ Public and Private Partnership (PPP) contracts reaching their expiry phase, building knowledge and capability for building owners within the public sector is essential.

The Infrastructure and Projects Authority’s (IPA) guidance document ‘Preparing for PFI Contract Expiry) recommends that the authorities (NHS Trusts, Higher and Further Education Sector, etc) commence the process of planning for a PFI or PPP building ‘handback’ at least seven years before the date of expiry of the contract.

The National Audit Office (NAO) found in its June 2020 report on PFI contract expiry that the public sector underestimated the time, resources and complexity involved in managing the end of PFI/PPP contracts.

What happens if you fail to prepare for PFI/PPP expiry?

The risks of failure to manage the expiry of PFI/PPP projects are significant and include:

• Operational disruption
• Lack of service continuity
• Financial loss
• Reputational damage

One of the reasons for commencing the process for ‘handback’ early is that for large and complex operational buildings (for example, major acute hospitals), it takes considerable time to undertake surveys and complete remedial works in advance of the contractual final condition survey work.

Our Recommendations to prepare for PFI/PPP handback

The process of preparing your lifts for PFI/PPP expiry can be broken down into four stages:

1. The first stage involves understanding the current condition and life expectancy of the lifts within your buildings and to ascertain the proportion of lifecycle costs expended on maintenance and repair.
2. In the second stage, a program of necessary refurbishment or upgrading works should be prepared, along with a detailed cost analysis. This information should be shared with both public and private partners.
3. The third stage involves negotiating a schedule of works and funding arrangements. It's important to consider the operational activities within the building to ensure that there is minimal disruption to tenants or the operational service.
4. Finally, upon completion of the program, commissioning data and handover information should be provided to the public sector or building owner to ensure that the lifts are compliant with the terms and conditions of the original PFI/PPP contract.

How ILECS can help you

If you’re looking for assistance in preparing for the transfer of ownership and mitigation of liabilities for the lifts in your buildings, ILECS are here to help. As independent lift and escalator consultants, we offer a range of services to help you navigate the process, including conducting condition surveys, providing expert recommendations and budgetary costs, establishing a programme of works, professionally managing any refurbishment or modernisation works, and undertaking the role of Authorising Engineer (lifts).

Please don't hesitate to contact us for more information on how we can assist you.