Many London boroughs are not prepared for the expiry of their private finance initiative (PFI) contracts and may struggle because of a lack of skills and resources, a report has argued.
The research by the think-tank Future of London laid the finger of blame at a combination of overstretched resources, a lack of skilled project management capacity, and not enough clarity around who ‘owns’ the contract and expiry process.
The ILP will convene a roundtable panel discussion on PFI expiry and the implications for local authority lighting teams at next month’s Lighting Live Annual Conference in Glasgow.
There will also be a special focus on PFI expiry in next month’s edition of Lighting Journal.
The Future of London report, ‘PFI Expiry: How London boroughs can get ahead’, with law firm Devonshires and construction consultancy Airey Miller, was based on the findings from two roundtables and interviews with officers and directors from 14 London boroughs.
While it covered the whole range of PFI contracts and PFI expiry – so schools, waste facilities, housing, social care, prisons, and hospitals as well as street lighting, roads and highways – it has some important takeaways, and advice, for local authority lighting teams who are themselves beginning to grapple with this issue as their PFI clock ticks down.
It emphasised just how serious things may be if local authorities get this wrong. The risks of failing effectively to manage the expiry of PFI projects were ‘significant’, it warned. Risks included major financial loss, operational disruption and reputational damage.
PFI expiry is also arriving at a time where London boroughs (and this obviously applies around the country, too) are cash- and resource-strapped. ‘There’s a real risk that a failure to dedicate the time and resource will lead to big problems further down the line,’ the report warned.
The biggest challenges councils identified were resourcing, getting management and political buy-in, lack of expertise and knowledge, lack of collaboration, stakeholder expectations, and costs.
It wasn’t all doom and gloom, however. Boroughs did also see a number of potential opportunities emerging from the expiry process, the report found.
These included the chance to improve assets and align them with future service needs, save on overheads, bring in greater flexibility, adaptability, and more control, leverage more commercial uses of assets, decarbonise, and bring in new thinking around service delivery.
Nicola Mathers, chief executive of Future of London, said the report was the first review of the implications of PFI contract expiry on London local authorities. ‘We talked to most of the boroughs affected and it’s clear that many feel under-prepared and under-resourced,’ she warned.
‘Our report also highlights practical approaches that boroughs can take now to ensure they are fully prepared and make the most of this opportunity to modernise services,’ she added.
The Lighting Live Annual Conference is set to take place from Wednesday 18 to Thursday 19 June at the Crowne Plaza in Glasgow.
To register to attend go to https://lightinglive.org.uk/2025annualconference/
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