Guidance

PFI/PPP finance guidance

Finance guidance specific to PFI/PPP arrangements.

• From: Infrastructure and Projects Authority and HM Treasury
• Published: 25 July 2013
• Last updated: 7 December 2018 — See all updates

Documents

Application note: interest-rate and inflation risks in PFI contracts

PDF, 131 KB, 23 pages

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Guidance note: the use of internal rates of return in PFI contracts

PDF, 46.4 KB, 5 pages

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Preferred bidder debt funding competitions: letter

PDF, 49.8 KB, 1 page

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Preferred bidder debt funding competitions: draft outline guidance for feedback

PDF, 66.4 KB, 12 pages

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Refinancing of early PFI transactions: code of conduct

PDF, 11.7 KB, 4 pages

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Guidance note: calculation of the authority´s share of a refinancing gain

PDF, 51 KB, 6 pages

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Covering note: value for money in refinancings

PDF, 125 KB, 2 pages

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Application note: value for money in refinancings

PDF, 215 KB, 10 pages

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Guidance on application of the Spens clause to PFI transactions: covering letter

PDF, 24 KB, 1 page

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Guidance on application of the Spens clause to PFI transaction

PDF, 31 KB, 2 pages

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Details

The government has announced that it will no longer use PF2, the current model of Private Finance Initiative (PFI) for new government projects. Existing PFI and PF2 contracts will not end because of this announcement.

Application note: interest and inflation risk

The application note has been designed to help Authorities understand and evaluate cost effective strategies for managing interest rate and inflation risks in PPP transactions.

The guidance note provides guidance on the calculation and use of internal rates of return (IRR) in PPP contracts.

Preferred bidder debt funding competitions

Following the public sector consultation of preferred bidder debt funding competitions, guidance has been published in draft-outline for wider feedback.

Refinancing

The Code of Conduct sets out the basis on which individual Authorities will approach the refinancing by private sector contractors of early PFI transactions. It is a voluntary Code to enable private sector contractors to share refinancing gain with the public sector on a consistent and equitable basis.

The guidance note is intended to help authorities and their financial advisers in calculating Refinancing Gains.

Spens

The government has previously expressed its concern that the Spens formula, which applies to listed bonds in the UK, creates an extra cost of termination for a PFI project. To address this concern HM Treasury requires all PFI contracts funded through the capital markets to contain a modified Spens clause. This guidance has been issued to assist Authorities in determining the most appropriate form of modified Spens to be applied.

Published 25 July 2013
Last updated 7 December 2018 + show all updates

1. 7 December 2018

   Updated with the statement: 'The government has announced that it will no longer use PF2, the current model of Private Finance Initiative (PFI) for new government projects. Existing PFI and PF2 contracts will not end because of this announcement'.

2. 25 July 2013

   First published.