Rebuilding the National Health Service: How can the new procurement methods be enhanced to achieve better value for money for the public sector: Private Finance Initiative (PFI) and Procure 21

Abstract

Tony Blair has described investment in the National Health Service as "genuine opportunity to rebuild the NHS for the 21st Century". Clearly the construction industry has crucial part to play. But what does the NHS client want from the sector And how do those involved in the projects feel about working under PFI and ProCure21 in terms of Value for Money BSJ, September 2004 . The National Health Service is the United Kingdom's largest construction client and will continue to be so for years to come. But it doesn't present a single face to the industry. Different NHS Trusts work in very diverse ways when it comes to procurement of new buildings and refurbishment work. Peter Woolliscroft, head of construction for NHS Estates, believes that in some cases, the Trust have demonstrated that the NHS can be very good client: 'The NHS client is becoming a very sophisticated client to the construction industry in general. Because the industry itself in becoming more sophisticated in its innovation and bringing to the client base a far better and more cost-effective way of doing what it does that it used to do. A lot of this has been driven out of Latham and Egan and such as this some of it is due to natural evolution to be honest" BSJ, September 2004 . This research aimed to compare, for NHS projects, which of the two main recent procurement initiatives viz PFI and Procure 21 is giving the public sector the better Value for Money, and why, and how either could be improved. Value for Money is not simply achieved through specification of efficient products, nor does it mean that each area of the building is efficient in its own right but the whole product achieves synergy. From the two case studies, Queen Alexandra Hospital PFI , Portsmouth and Elyn Lodge at St Helens Hospital Procure 21 , Liverpool, the outcome of the research shows that much more can be done to enhance the Value for Money from the two procurements methods (options) which will benefit the NHS client and ultimately to the benefit of the wider industry and future generations it will serve. Key words: PFI, Procure 21, Value for Money (VFM), Partnering, Teamworking, Innovation and Commitment