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The UK's infrastructure landscape is at a turning point. With a substantial wave of Private Finance Initiative (PFI) contracts due to expire over the next 15 years, and a Government focused on bringing fresh private capital into public services, the key question is: what does the next generation of public-private investment actually look like?
Our latest insight note tackles that question head on, exploring the emerging infrastructure finance models being considered by the UK Government and the very real challenges of transitioning away from a deeply embedded legacy estate and managing the interaction between old and new structures.
Some of the issues we examine in our analysis include:
- A deep dive into each of the financing models – outlining their different philosophies around how risks, returns and governance are shared between public authorities, private sponsors and lenders and examples of how each has been deployed in recent infrastructure projects.
- Exiting and unwinding existing PFI arrangements - we examine the financial and legal barriers authorities may encounter when seeking to exit a legacy contract and transition to a different structure, including compensation obligations, lender consent and reprocurement costs.
- The healthcare challenge - Government ambitions around new community health facilities are considerable. We consider the challenges of navigating the complex landscape of existing partnership assets in the NHS estate and Local Improvement Finance Trust properties in relation to the new financing models.
Please click here to read our commentary in full.
We will continue to track developments closely as policy evolves and will publish further guidance in due course. In the meantime, we would be happy to answer any questions, whether you have existing PFI investments or are considering a new opportunity. Please contact any of the team below for an initial conversation.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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