§ Matthew TaylorTo ask the Secretary of State for Health what estimate he has made of the proportion of PFI contracts made by his Department where an amount in excess of 90 per cent. of the capital value of the asset is recouped by the lessor out of the capital element of lease payments over the lifetime of the contract concerned; and if he will make a statement. [27699]
§ Mr. HuttonThe Department does not calculate or collect data on this basis.
The balance sheet treatment of private finance initiative schemes is determined by guidance developed by Her Majesty's Treasury (Technical Note 1) and the Accounting Standards Board (FRS5), which was issued in 1998. Neither of these refer to or rely on the numeric test referred to in the question.
142WA small number of early national health service PFI schemes (total approximately £250 million) have been classed as on balance sheet. These schemes reached financial closure before 1998. Although they were classed as off-balance sheet under the tests in force at the time, they were reassessed following the issue of the 1998 guidance and re-classified as being on balance sheet. The test in force prior to 1998 relied on estimates of the variability of shareholders' return, not estimates of payments recouped by lessors.