LETTERS

Response to public–private partnerships and the Private Finance Initiative

Martin McKee^I,1; Nigel Edwards^II; Rifat Atun^III

^IEuropean Observatory on Health Systems and Policies, London School of Hygiene and Tropical Medicine, Keppel Street, London WC1E 7HT, England
^IIDepartment of Public Health and Policy, London School of Hygiene and Tropical Medicine, London, England
^IIIImperial College London, London, England

Allyson Pollock suggests that we have been unduly lenient on the Private Finance Initiative (PFI), even though we made very clear that this policy, which continues to underpin the British Government’s approach to capital procurement, has many flaws. Specifically, Pollock criticizes our suggestion that the jury is still out. We sympathize with her argument, as will be clear from our earlier paper entitled "Is the private finance initiative dead?"¹ in which we suggested that it was. However, notwithstanding our views, some people seem determined to keep it alive, a decision that is now even more surprising given growing evidence of how it is distorting planned reconfigurations of hospital services.² We felt it was important to reflect the reality that not everyone was convinced by the evidence. Furthermore, it is important to recognize that the available evidence relates almost exclusively to the models adopted in the Australia and the United Kingdom, and we cannot exclude the possibility that models employed elsewhere might be more successful.

We must clarify our description of the debate as ideological. In the following sentence we noted the fierce personal attacks that had been made by some British politicians on one PFI critic and, although we did not name her, the victim was Pollock. The juxtaposition of these sentences was intended to make clear that the ideology was emanating from successive British governments. We agree entirely that the wealth of evidence that Pollock and her team have produced has not elicited any meaningful response from the government, who have consistently declined to engage on the issues.

We disagree that we failed to address the failure to transfer risk from the purchaser to the contractor. While we welcome Pollock’s additional information, we did discuss this in the section on cost. Although we might debate the precise wording that was used, we do not argue that the profits made by some private consortia have been, by any standards, excessive.

We do, however, concede Pollock’s final point about timeliness. We did address this partially in relation to the failed development in west London but we should have made clear that when the overall project duration is considered, beginning with the outline business case, then the duration, as well as the cost, is often much greater than with conventional procurement.

We welcome this opportunity to have an open debate on the British model of public–private partnership. We agree with Pollock that this is a flawed model, even if we focus on different aspects of it. It is only a pity that its strongest supporters are unwilling to justify their position publicly.

References

1. Atun RA, McKee M. Is the private finance initiative dead? BMJ 2005; 331: 792-793.

2. Moore A. Service cuts urged at non-PFI hospitals. Health Serv J 2007; 14 June: 7.

1 Correspondence to Martin McKee (e-mail: martin.mckee@lshtm.ac.uk).