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Negotiate your own PFI funding, Ministries told

GOVERNMENT DEPARTMENTS should shop around for the best deal for private finance initiative projects, the UK's most senior civil servant said this week.

Speaking on completion of the £141M project to refurbish the Treasury's Whitehall offices, permanent secretary Sir Andrew Turnbull told NCE that government departments should negotiate their own finance deals or renegotiate the consortium's financing.

'My message to other government departments would be 'don't just take the finance offer that comes along with the project'.'

The Treasury carried out a separate competition to fund the refurbishment once Exchequer Partnerships - a consortium of Bovis Lend Lease, Stanhope and Chestertons - had won the 35 year privately financed refurbishment and maintenance contract.

'Not only did this produce some important savings, but it gave us a degree of due diligence which was way ahead of anything the conventional department scrutiny could produce and required us to think much more carefully about every eventuality, ' said Turnbull.

A National Audit Office report last year confirmed the funding competition would save the Treasury £13M over the lifetime of the project.

The Treasury will pay £14M a year - linked to inflation - for 35 years to Exchequer Partnership for the 45,000m 2building, known as 1 Horse Guards Road. The department's 1,200 staff will move in between now and the middle of August.

Turnbull has just been promoted to cabinet secretary and head of the civil service.

INFOPLUS For full details of the refurbishment and the background to the project and its funding visit www. nceplus.co.uk/magazine

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