Analysis of factors affecting value for money in UK PFI projects

Christian Henjewele, Ming Sun, Peter Fewings

    Research output: Contribution to journalArticlepeer-review

    18 Citations (Scopus)


    Purpose – This paper aims to report findings froma study on factors that made value for money (VFM)
    in private finance initiative (PFI) projects vulnerable to variations. It seeks to identify the top influencing
    factors, rank them according to the relative strength of influence, and explore their interactivity.
    Design/methodology/approach – The study uses a documentary review of full business cases of
    five PFI projects, published reports, and scholarly publications to identify the list of factors; and a
    questionnaire survey of 44 PFI projects in the UK to establish the ranking of importance.
    Findings – The findings reveal that PFI projects are more strongly affected by client-driven internal
    factors than external factors. Internal factors, such as design change in the development phase and
    requests for new works or services in the operational phase were also likely to act independently, while
    external factors, including conditions for approval, movement in construction costs and change in PFI
    guidelines, worked interactively.
    Practical implications – The research findings add to the knowledge of priority factors that need to
    be addressed to enhance the achievement of long-term VFM in PFI projects.
    Originality/value – The study is one of the few studies that have investigated VFM of PFI projects
    from a whole life cycle and dynamic perspective. It reveals not only a list of main influencing factors of
    project VFM, but also interrelationship between these factors.
    Original languageEnglish
    Pages (from-to)9-28
    JournalJournal of Financial Management of Property and Construction
    Issue number1
    Publication statusPublished - 2012


    • Internal and external factors
    • Private finance
    • Private finance initiative
    • Uncertainty management
    • Value for money


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