3 December 2008
More than a third of local authorities believe that the current financial instability will have a large impact on major projects and associated service delivery, according to new research.
New leisure, waste management and transport projects are taking longer to secure as the economic downturn bites.
The research by 4ps, local government’s delivery specialist, shows that 27 per cent of local authorities have seen project costs rise and a third have experienced delays.
4ps’ research, carried out with representatives from 200 local authorities in England,
shows that almost half of authorities believe the current economic climate is having
an impact on their ability to achieve programme efficiency gains. Of this group, over two-thirds said their ability to generate efficiency gains have been reduced by up to
10 per cent.
Different sectors are experiencing wide variations with project delivery. Referring to
all types of projects, not just PFI, 11 per cent of local authorities have experienced delays with new waste projects with 14 per cent experiencing problems in the schools sector and 33 per cent saying leisure projects are slipping. Over three quarters of authorities identified regeneration projects as experiencing delays while 61 per cent said housing projects were suffering.
In spite of the economic downturn, two thirds of local authorities said they are still
confident working with the private sector.
Different sectors are experiencing wide variations with project delivery. Referring to
all types of projects, not just PFI, 11 per cent of local authorities have experienced delays with new waste projects with 14 per cent experiencing problems in the schools sector and 33 per cent saying leisure projects are slipping. Over three quarters of authorities identified regeneration projects as experiencing delays while 61 per cent said housing projects were suffering.
In spite of the economic downturn, two thirds of local authorities said they are still
confident working with the private sector.
Edward Lord, 4ps chairman, said that despite the concerns, projects are still closing and local authorities are working hard to maintain the delivery of high quality services in their local communities.
Chris Wilson, 4ps executive director, said: “4ps is supporting authorities to make
efficiency savings through effective joint working, promoting best practice, and
standardisation of procurement operations. Many advantages of Public Private
Partnerships remain, however, it is increasingly important that those local authorities
engaged on projects involving project finance monitor developments closely and
ensure they develop and implement where necessary appropriate risk mitigation
strategies.”
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