Social PPP Housing in the UK Kevin Hanlon Director, 4ps...
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Social PPP Housing in the UK Kevin Hanlon Director, 4ps December 2007
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Transcript of Social PPP Housing in the UK Kevin Hanlon Director, 4ps...
Soci
al P
PP H
ousi
ng in
the
UK
Kev
in H
anlo
n D
irect
or, 4
ps D
ecem
ber 2
007
UK
Hou
sing
Mar
ket
•70
% o
f hom
es in
the
UK
are
priv
ate
•30
% a
re G
over
nmen
t soc
ial r
ente
d or
priv
ate
rent
ed
•A
lack
of p
rivat
e ho
uses
; ris
ing
hous
e pr
ices
; affo
rdab
ility
and
lack
of
soc
ial r
ent h
omes
are
acu
te p
robl
ems
in th
e U
K
•A
nnua
l priv
ate
hous
e bu
ildin
g is
abo
ut 1
80,0
00 u
nits
per
yea
r
•Th
e G
over
nmen
t prio
rity
is to
pus
h up
soc
ial h
ouse
bui
ldin
g w
ithan
£8
billi
on in
vest
men
t to
tack
le h
ousi
ng s
horta
ge o
ver 3
yea
rs
from
200
8/09
to :
•B
uild
at l
east
70,
000
affo
rdab
le h
ouse
s a
year
by
2011
•A
targ
et to
bui
ld 5
0,00
0 so
cial
hom
es a
yea
r
Soci
al H
ousi
ng P
PP B
ackg
roun
d in
UK
•S
ocia
l Ten
ants
in th
e U
K h
ave
a rig
ht to
buy
thei
r hom
es. S
ales
sin
ce
1980
hav
e ex
ceed
ed 3
00,0
00 u
nits
gen
erat
ing
£45b
illion
. 75%
of t
he
proc
eeds
hav
e re
verte
d ba
ck to
Gov
ernm
ent w
ith 2
5% g
oing
to th
e Lo
cal
Aut
horit
y.
•S
ince
199
7 12
0+ a
utho
ritie
s ha
ve tr
ansf
erre
d th
eir h
ousi
ng s
tock
to
Priv
ate
Reg
iste
red
Soc
ial L
andl
ords
(RS
L), t
rans
ferr
ing
1mill
ion
prop
ertie
s.
•A
roun
d 98
Gov
ernm
ent L
ocal
Aut
horit
ies
have
opt
ed to
reta
in th
eir s
tock
m
anag
ing
857,
000
prop
ertie
s.
•To
dat
e PF
Iis
set t
o de
liver
: new
bui
ld fo
r ren
t4,4
73
prop
ertie
s,re
furb
ishe
d fo
r ren
t 15,
898
prop
ertie
s, re
furb
ishe
d fo
r le
aseh
olde
rs 2
,373
pro
perti
es, n
ew b
uild
for s
ale
2,75
8 pr
oper
ties.
Thi
s ha
s in
volv
ed in
vest
men
t of £
2.3
billi
on.
•Th
e H
ousi
ng C
orpo
ratio
n (H
C) i
s th
e G
over
nmen
t ‘qu
ango
’tas
ked
with
in
vest
men
t in
build
ing
new
soc
ial a
nd a
fford
able
hom
es. G
rant
isaw
arde
d by
the
HC
to R
SLs
. The
HC
inve
stm
ent p
lans
for 2
006/
08 a
re:
•£3
.1 b
illio
n in
mai
nstre
am p
rogr
amm
es (£
2.6
billi
on fo
r soc
ial r
ent;
£430
m
illio
n fo
r low
cos
t ow
ners
hip
and
£6 m
illio
n fo
r int
erm
edia
te re
nt,
prov
idin
g 60
,882
hom
es
•£4
64 m
illio
n on
13,
882
key
wor
ker h
omes
)
the
UK
PFI
pro
gram
me
to d
ate
•P
FI la
unch
ed in
199
2 in
the
UK
•P
FI c
over
s bu
ildin
g ne
w S
choo
ls; H
ospi
tals
; Was
te P
lant
s; H
ouse
set
c
•U
K s
ucce
ssfu
lly c
lose
d ov
er 7
00 d
eals
, ove
r £45
bill
ion
inve
sted
•R
epre
sent
s 10
-15%
of U
K c
apita
l inv
estm
ent p
er y
ear
•To
tal U
K P
FI in
vest
men
t lev
els
for 3
yea
rs 2
007/
08 –
2009
/10
£12
billi
on
•21
hou
sing
pro
ject
s si
gned
and
16
proj
ects
in p
rocu
rem
ent
•Fu
ture
fund
ing
£1.8
bill
ion
for H
ousi
ng fr
om 2
008/
09 o
ver 3
yea
rs
•S
tand
ard
Con
tract
s no
w e
xist
•M
arke
t wel
l dev
elop
ed
•V
FM a
nd A
fford
abili
ty c
ritic
al
•Lo
cal G
over
nmen
t bid
s fo
r PFI
fund
ing
from
Cen
tral G
over
nmen
t
•A
ll P
FI/P
PP
pro
ject
s ar
e re
quire
d to
pro
duce
an
Bus
ines
s C
ase
•G
over
nmen
t Dep
artm
ents
app
rove
the
Bus
ines
s C
ase
for
prov
isio
nal f
undi
ng
•U
K T
reas
ury
has
a P
roje
cts
Rev
iew
Gro
up (P
RG
)whi
ch th
en
appr
oves
the
mon
ey fo
r the
Bus
ines
s C
ase
•P
roje
cts
with
Dep
artm
ent a
nd T
reas
ury
appr
oval
can
pro
ceed
to
proc
urem
ent
•A
ll P
FI/P
PP
pro
ject
s ar
e su
bjec
t to
Loca
l Gov
ernm
ent i
nter
nal
appr
oval
s
•A
ll P
FI p
roje
cts
prod
uce
a Fi
nal B
usin
ess
Cas
e fo
r Gov
ernm
ent
Dep
artm
ent a
ppro
val b
efor
e th
e m
oney
is re
leas
ed
UK
Gov
ernm
ent P
FI a
ppro
vals
pro
cess
The
PPP
Proc
urem
ent P
roce
ss –
EU G
uida
nce
4 w
eeks
3 w
eeks
3 w
eeks
2 w
eeks
Clo
se
Com
petit
ive
Dia
logu
e an
d C
all
for F
inal
Ten
ders
(C
FT)
Fina
l Ten
der
com
plet
ed
2/4
wee
ks
Fina
ncia
l Clo
se
Con
firm
co
mm
itmen
ts,
final
cla
rific
atio
ns,
due
dilig
ence
&
appr
oval
s
6/24
wee
ks
Fine
tuni
ng, &
fin
al e
valu
atio
n.
Pre
ferr
ed B
idde
r se
lect
ed
6/8
wee
ks
+ 6
wee
ks1
wee
kD
escr
iptiv
e D
ocum
ent*
&
PQ
Q is
sued
on
rece
ipt o
f EoI
OJE
U N
otic
e is
sued
Pro
cure
men
t pr
epar
atio
n
Bid
ders
co
nfer
ence
&
com
plet
ed P
re
turn
ed
1st
Stag e
PRG Competitive Dialogue
Ope
n C
D: I
nvite
to
par
ticip
ate
in
CD
& S
ubm
it O
utlin
e S
olut
ions
(IS
OS
)
Initi
al d
ialo
gue
with
bid
ders
.
O
utlin
e S
olut
ions
su
bmitt
ed
Eva
luat
ion,
cl
arifi
catio
n &
di
alog
ue o
n O
utlin
e S
olut
ions
Eva
luat
ion
repo
rt &
app
rova
l of
shor
t-lis
t for
di
alog
ue o
n D
etai
led
Sol
utio
ns
Ref
inem
ent o
f pr
ojec
t do
cum
ents
Issu
e In
vita
tion
to
Sub
mit
Det
aile
d S
olut
ions
(IS
DS
)
Pot
entia
l fur
ther
di
alog
ue &
re
finem
ent o
f so
lutio
ns
Dia
logu
e an
d B
idde
rs s
ubm
it D
etai
led
Sol
utio
ns
13 w
eeks
10 /
12 w
eeks
Eva
luat
ion,
cl
arifi
catio
n,
dial
ogue
&
“neg
otia
te”
11/1
3 w
eeks
Asse
ss re
adin
ess
to c
lose
dia
logu
e
2 w
eeks
2nd
Stag e
PRG
PQ
Q e
valu
atio
n &
pr
e-qu
alifi
ed li
st
of b
idde
rs a
gree
d an
d ap
prov
ed
The
Leed
s C
ounc
il PP
P U
nit
•Le
eds
Cou
ncil
has
its o
wn
PP
P/P
FI U
nit
•Th
e C
ounc
il ha
s a
team
of l
awye
rs, a
ccou
ntan
ts w
hom
man
age
PP
P p
roje
cts
alon
g w
ith a
dvis
ors
•Th
e P
PP
Uni
t bid
s fo
r cen
tral G
over
nmen
t Fun
ding
(i.e
. PFI
) for
P
PP
no
cent
ral f
undi
ng it
all
com
es fr
om th
e pr
ivat
e se
ctor
•Th
e P
PP
Uni
t man
ages
pro
ject
s an
d pr
ocur
emen
t (ho
usin
g,
scho
ols,
was
te) t
o fin
d pr
ivat
e se
ctor
par
tner
s an
d in
vest
men
t
•S
take
hold
ers
are
cons
ulte
d (p
ublic
, ten
ants
etc
)
•Th
e C
abin
et in
the
Cou
ncil
appr
oves
all
proj
ects
•Le
eds
Cou
ncil
PP
P U
nit h
as m
anag
ed £
800
mill
ion
in p
roje
cts
The
Swar
cliff
e Es
tate
PFI
in L
eeds
Swar
cliff
e Le
eds
Swar
cliff
e PF
I -Po
or H
ousi
ng
•In
nee
d of
inve
stm
ent a
nd re
gene
ratio
n
•2,
700
poor
non
-Dec
ent C
ounc
il ho
mes
•1,
300
owne
r occ
upie
rs -
50%
of t
he h
ouse
s
•P
opul
ar fa
mily
hom
es &
sta
ble
popu
latio
n
•P
oor l
ayou
t, ac
cess
& p
arki
ng
•P
oor q
ualit
y pu
blic
spa
ces
and
neig
hbou
rhoo
d ce
ntre
•11
unp
opul
ar h
igh
rise
bloc
ks
•E
mpt
y fla
ts; h
igh
turn
over
of o
ccup
ants
•S
ubst
ance
abu
se, c
rime,
ant
i-soc
ial b
ehav
iour
risi
ng
Wha
t was
nee
ded
•H
ouse
s no
t fla
ts•
Dec
ent H
omes
•S
ecur
e ho
mes
•G
reen
Spa
ce•
Car
Par
king
•Fa
mily
pla
y ar
eas
•N
ew H
omes
•S
hops
•Im
prov
ed R
oads
Why
PFI
/PPP
•S
igni
fican
t inv
estm
ent n
eede
d £1
00m
+ Le
eds
did
not h
ave
the
mon
ey
•U
K G
over
nmen
t pro
mot
es th
e pu
blic
and
priv
ate
sect
ors
wor
king
in
par
tner
ship
s
•U
K g
over
nmen
t offe
rs L
eeds
£79
mill
ion
in P
FI fu
ndin
g
•S
truct
ured
2 y
ear p
rocu
rem
ent t
o fin
d a
suita
ble
partn
er
•25
yea
r con
tract
bet
wee
n Le
eds
and
its P
artn
er
•P
rices
fixe
d; ro
bust
lega
l con
tract
s; ri
sks
trans
ferre
d to
priv
ate
sect
or
•P
artn
er: C
arill
ion
PLC
; Yor
kshi
re H
ousi
ng a
nd B
ank
of S
cotla
nd
Plc
Typi
calP
FI s
truct
ure
Loca
l G
over
nmen
t
SP
V L
imite
dB
ank
Ope
rato
r/FM
Com
pany
Con
tract
or
Inve
stor
s
Cen
tral
Gov
ernm
ent
Dire
ct A
gree
men
tA
sset
s &
Ser
vice
s
Uni
tar
y
Pro
ject
Agre
emen
t
PFI
Cre
dits
(?)
Shar
e C
apita
l
Juni
or o
rSu
bord
inat
ed D
ebt
Con
stru
ctio
n C
ontra
ctO
pera
tion
/ Fac
ilitie
s M
anag
emen
t Con
tract
Loan
Agr
eem
ent
Cha
rge
The
Inve
stm
ent M
ade
•1,
659
Cou
ncil
hom
es im
prov
ed
and
refu
rbis
hed
to D
ecen
cy P
lus
by 2
010
•94
3 Fl
ats
dem
olis
hed
•N
ew c
omm
unal
are
as, e
xter
nal
envi
ronm
ent &
com
preh
ensi
ve
rene
wal
s
•£1
50m
inve
stm
ent o
ver 3
0 ye
ars
with
£79
mill
on fr
om U
K c
entra
l G
over
nmen
t in
PFI
mon
ey
•P
lann
ed m
aint
enan
ce fo
r 25
year
s
•C
aret
akin
g, c
lean
ing
& g
roun
ds
mai
nten
ance
•Te
nanc
y m
anag
emen
t via
the
ALM
O
•Th
e D
evel
opm
ent A
gree
men
t
•35
0 ne
w h
omes
for s
ale
•10
0 ne
w h
omes
for s
ocia
l ren
t; 40
fo
r sha
red
owne
rshi
p
•N
ew ro
ad la
yout
& c
onne
ctiv
ity
•La
ndsc
apin
g &
env
ironm
enta
l w
orks
•3
play
are
as
•G
uara
ntee
d m
inim
um p
rice
•P
rofit
sha
ring
on in
crea
ses
in la
nd
valu
es
•E
co H
omes
Now
in 2
007
•To
wer
blo
cks
dem
olis
hed
•H
omes
bei
ng re
furb
ishe
d
•60
new
hom
es c
ompl
eted
•Th
e ar
ea h
as c
hang
ed fo
r the
be
tter
•S
atis
fact
ion
leve
ls a
re u
p
•C
rime
& a
nti-s
ocia
l beh
avio
ur
dow
n
•N
ew h
omes
are
pop
ular
•E
mpt
y ho
mes
at 1
% &
turn
over
low
•Jo
int w
orki
ng e
stab
lishe
d be
twee
n Y
orks
hire
Tra
nsfo
rmat
ions
and
Le
eds
Eas
t Sou
th E
ast H
omes
2007
Dev
elop
men
t of E
co H
omes
and
C
omm
unity
Fac
ilitie
s
•40
Soc
ial E
co H
omes
•G
over
nmen
t Prio
rity
to re
duce
C
O2
emis
sion
s in
the
UK
to m
eet
EU
and
Wor
ld T
arge
ts
•S
hops
•D
octo
rs S
urge
ries
•N
ew R
oad
Link
s
•C
hild
ren
Pla
y A
reas
Leed
s PP
P EA
SEL
Reg
ener
atio
n of
G
ipto
n
EASE
L Le
eds
PPP
•£1
.8 b
illio
n P
PP
(No
Gov
ernm
ent F
undi
ng li
ke P
FI)
•Jo
int V
entu
re P
PP
Com
pany
bet
wee
n Le
eds
City
and
Bel
lway
H
omes
Plc
•R
egen
erat
ion
of G
ipto
n w
hich
has
11,
000
hom
es
•A
16
ha a
rea
to b
e cl
eare
d
•1,
000
soci
al h
omes
to b
e de
mol
ishe
d
•5,
000
new
hom
es to
be
built
with
pro
fits
bein
g in
vest
ed in
the
rege
nera
tion
of G
ipto
n
•15
yea
r pro
ject
Leed
s PP
P C
halle
nges
•P
rocu
rem
ent T
imes
cale
s
•S
kills
and
Exp
ertis
e
•R
esou
rces
•V
FM
•Th
e ch
alle
nge
of m
anag
ing
25 y
ear c
ontra
cts
•P
lann
ing
•V
alue
for M
oney
and
Affo
rdab
ility
•Fu
ndin
g
•A
dvis
or c
osts
Con
clus
ion
•P
PP
ver
y po
pula
r in
UK
•M
ajor
ity o
f Hou
sing
in th
e U
K in
the
priv
ate
sect
or
•V
ery
few
soc
ial h
omes
bui
ld o
ver t
he la
st te
n ye
ars
•S
igni
fican
t Inv
estm
ent $
billi
ons
in im
prov
ing
exis
ting
soci
al h
ouse
s m
ade
by th
e U
K g
over
nmen
t ove
r the
last
ten
year
s
•N
ew fo
cus
is to
bui
ld m
ore
soci
al a
nd a
fford
able
hom
es
•La
nd li
mite
d an
d pl
anni
ng a
con
stra
int a
nd b
eaur
ocra
cy
•C
osts
esc
alat
ing
in b
uild
ing
hous
es (r
aw m
ater
ials
, wag
es e
tc)
•La
ck o
f bui
ldin
g fro
m p
rivat
e se
ctor
priv
ate
hom
es a
s th
ey m
anag
e pr
ofits
Con
tact
det
ails
Kev
in H
anlo
n
Proj
ects
Dire
ctor
, 4ps
kevi
n.ha
nlon
@4p
s.go
v.uk
Tel:
0774
7 44
1787
