Title: United Kingdom Treasury - Finance guidance

Languages: English

Type: Document

Region: Europe and Central Asia

Country: United Kingdom

Topics: Financing and Risk Mitigation

Keywords: Value for Money (VFM)

Document Details:

Application note: interest and inflation risk

• Application note - interest-rate and inflation risks in PFI contracts (PDF 131KB)

This application note has been designed to help Authorities understand and evaluate cost effective strategies for managing interest rate and inflation risks in PPP transactions.

• Guidance note: the use of internal rates of return in PFI contracts (PDF 47KB)

This guidance note, previously published as Annex 2 of SoPC Version 3, provides guidance on the calculation and use of internal rates of return (IRR) in PPP contracts.

 

Preferred bidder debt funding competitions

The public sector consultation of preferred bidder debt funding competitions has concluded, and the guidance has been published in draft-outline for wider feedback.

• Preferred bidder debt funding competitions - letter (PDF 144KB)
• Preferred bidder debt funding competitions - draft outline guidance for feedback (PDF 68KB)

 

Refinancing

• Refinancing of early PFI transactions - code of conduct (PDF 12KB)

This Code of Conduct sets out the basis upon which individual Authorities will approach the refinancing by private sector contractors of early PFI transactions. It is a voluntary Code to enable private sector contractors to share refinancing gain with the public sector on a consistent and equitable basis.

• Guidance note: calculation of the authority´s share of a refinancing gain (PDF 51KB)

This guidance note, previously published as Annex 1 of SoPC Version 3, is intended to assist authorities and their financial advisers in calculating Refinancing Gains.

• Covering note: value for money in refinancing
• Application note: value for money in refinancings (PDF 124KB)
• Covering note: SoPC 4 addendum October 2008 - amended refinancing provisions (PDF file 23KB)
• SoPC 4 addendum October 2008 - amended refinancing provisions (PDF file 34KB)
• Covering note: SoPC 4 addendum April 2009 - amended refinancing provisions (PDF 97KB)
• SoPC 4 addendum April 2009 - amended refinancing provisions (PDF 111KB)
• Covering Note: SoPC 4 Addendum April 2012 – Amended Refinancing Provisions (PDF 137KB)
• SoPC 4 Addendum April 2012 – Amended Refinancing Provisions (PDF 135KB)

 

SPENS

• Guidance on application of the Spens clause to PFI transactions- covering letter (PDF 23KB)
• Guidance on application of the Spens clause to PFI transaction (PDF 32KB)

Government has previously expressed its concern that the Spens formula, which applies to listed bonds in the UK, creates an extra cost of termination for a PFI project. To address this concern HM Treasury requires all PFI contracts funded through the capital markets to contain a modified Spens clause. The above guidance has been issued to assist Authorities determine the most appropriate form of modified Spens to be applied.

 

Technical update 2010

This document sets out the recent changes made to PPP/PFI and updates the delivery framework for projects going forward.

• Technical update 2010 (PDF 429KB)

 

 

Related Resources

The Treasury provides guidance on a number of topics. This includes the publication A new approach to Public Private Partnerships and Standardisation of PF2 contracts (December 2012) and guidance on assessing the value for money of privately financed projects, as well as finance, procurement and contract management.

• Procurement and contract management
• Standardised contractual guidance
• Finance guidance
• Budgeting and accounting for PPP arrangements
• Value for money assessment for using private finance
• Archived guidance

Updated: March 29, 2021