Hammond disappoints on PF2 hopes

8 March 2017 Chancellor Philip Hammondís first Budget has disappointed the private finance industry by failing to announce the hoped-for pipeline of PF2 projects.

An announcement on a new pipeline of PF2 projects in “early 2017” was promised in last year’s Autumn Statement, with the Infrastructure and Projects Authority (IPA) understood to be compiling a list of projects in preparation for today’s Budget.

However, the Budget did not include the pipeline, and made no reference to the announcement in the Autumn Statement. Sources have insisted that a pipeline will be forthcoming in the near future, however.

"Many in the industry were expecting the announcement of a new pipeline of PF2 projects, so it's disappointing for it not to even get a mention," said Robert Meakin, partner at law firm Clyde &Co. "Despite being launched back in 2012, the government has yet to fully embrace this model.

"Sooner or later, we'll need to see actual schemes coming to the market, at a sufficient level to convince the private sector that it's genuinely worth the investment of their time, money and resource."

It is understood that schemes covering healthcare, transport, new prisons and new defence accommodation are all in the pipeline to be developed under the PF2 model. Sources had suggested that some schemes could be tendered before the end of this year, although that had been on the assumption that there would be announcements in the Budget.

In January, Partnerships Bulletin revealed that the Infrastructure and Projects Authority had been working on a refresh of the SoPC guidance, but this was not mentioned by Hammond.

On infrastructure more broadly, Hammond linked it once again to productivity, saying that increases in investment would reduce the country's productivity gap. He also pledged £19m for the North and £23m for the Midlands to tackle transport congestion.

There was £325m in capital for the first sustainability and transformation plans (STPs) to be put forward by the NHS.

Hammond also announced a deal had been agreed with the Mayor of London on more devolution for the capital, which will include a taskforce “to explore piloting a new approach to funding infrastructure”. 

This page was last updated on:
21 September 2017.

thumb

Time to be bold

PF2 projects are slowly bubbling to the surface, but will the market take the bait?

thumb

The Insurance Man

Darryl Murphy, head of debt investment at Aviva Investors discusses where he intends to take the organisation next

register

Register now to get un-restricted access to all sections of the website.

Want to see more first? Try our free preview...