Risk assessment in PFI schemes for primary health care

Abstract

This paper identifies that the methods used to quantify the financial risk of appraisals of private sector projects for primary health care development have been inadequate. Data was collected and analysed from private developers on 18 schemes, varying by scale and location. It is argued that this is important for those involved with facilities management as well as those directly involved with the financial risk appraisal of a PFI/PPP project. Financial risks are more likely to arise when certain build designs are used which make projects more susceptible to particular risks. The paper makes recommendations on the appraisal of future projects for value for money reflecting the risk transfer achieved and devising a common, systematic format to provide consistency and standardisation. It concludes, however, that systems should not be formulated which might act as disincentives to the private sector, or impose increased workloads on the public sector in assessing proposals.