Dermot Gleeson, the incoming chairman of the Major Contractors Group, has outlined a five-point plan to improve the PFI process
He said that contractors might want to reject the government's idea of batching many small projects together as it was too complicated.

Gleeson, speaking at the Public Private Finance Congress 2003 this week, said: "From a contractor's perspective, differently designed, multi-site schemes 鈥� particularly if they involve more than one client 鈥� have frankly limited appeal."

Instead he suggested that the government's LIFT approach (a procurement initiative for small health centres) could be the best way to develop smaller projects, in health and other sectors.

Research by the Major Contractors Group shows that contractors' PFI hospital bid costs amounted to about 拢1m, whatever the size of the project, plus about 6% of capital spend. In his five-point plan, Gleeson encouraged the government to seek alternatives to batching, manage the timing of PFI deals better, allow standardisation and reduce the risk contractors face on projects. He also called for greater central management control.

Differently designed, multi-site schemes have frankly limited appeal

Dermot Gleeson, Major Contractors Group

On the issue of standardising PFI projects, he said he would reduce unit construction costs and make bidding quicker and cheaper. "Each hospital, for example, really does not need an individual design for its bathrooms and basic room layouts," he said.

Gleeson said that the government needed to manage the timing of PFI deals more effectively to cut bid costs. He said that bid schedules must be adhered to so that contractors could plan their resources.