§ Matthew TaylorTo ask the Chancellor of the Exchequer how many contracts his Department had with(a) Barclays, (b) the Royal Bank of Scotland, (c) UBS Warburg and (d) the Bank of Scotland for advice on private finance initiative and public private partnership contracts in each financial year since 2001–02; and what fees were paid in each case. [186662]
§ Ruth KellyNone
1208W
§ Mr. CousinsTo ask the Chancellor of the Exchequer what level of costs for insurance is included in PFI/PPP schemes agreed in the last two years; what review of insurance costs has been undertaken; and what conclusions have be en reached. [186845]
§ Mr. BoatengThe contractor in a PFI consortium is responsible for procuring the necessary insurance for a PFI scheme. The costs will vary depending on the nature of the project as well as the conditions in the insurance market at the time the insurances are taken out.
There has been no official review of PFI insurance costs by HM Treasury. However, guidance on the treatment of insurance costs is contained in the HMT Standardisation of Contracts Version 3 (SOPC3) and OGC Business and Operational Guidance "PFI Contracts: Insurance Costs". SOPC3 states that the risk of increases in insurance costs should be borne by the contractor, while recognising that it will not represent best value for money if bidders price in worst case scenarios for future insurance premium levels in to their bids. The OGC guidance therefore sets out a mechanism for sharing insurance cost increases should there be exceptional circumstances in the international insurance market.