An Examination of the UK Treasury's Evidence Base for Cost and Time Overrun Data in UK Value-for-Money Policy and Appraisal

Posted: 3 Apr 2007

See all articles by Allyson M. Pollock

Allyson M. Pollock

University of Edinburgh

David W. Prince

University of Edinburgh

Stewart Player

University of Edinburgh

Abstract

UK government procurement policy rests on Treasury claims that the private finance initiative (PFI) has reduced cost and time overruns. We review the five studies cited by the Treasury in support of this claim and find that only one purports to compare PFI with traditional procurement. The results of this single study are uninterpretable because of selection bias, small sample size (only 11 out of 451 PFI projects are included) and fundamental flaws in the analysis. There is thus no evidence to support the Treasury cost and time overrun claims of improved efficiency in PFI. We conclude that Treasury appraisal guidance, the Green Book which compares PFI with other methods of procurement, is not evidence based but biased to favour PFI.

Suggested Citation

Pollock, Allyson M. and Prince, David W. and Player, Stewart, An Examination of the UK Treasury's Evidence Base for Cost and Time Overrun Data in UK Value-for-Money Policy and Appraisal. Public Money & Management, Vol. 27, No. 2, pp. 127-134, April 2007, Available at SSRN: https://ssrn.com/abstract=976797 or http://dx.doi.org/10.1111/j.1467-9302.2007.00568.x

Allyson M. Pollock (Contact Author)

University of Edinburgh ( email )

Old College
South Bridge
Edinburgh, Scotland EH8 9JY
United Kingdom

David W. Prince

University of Edinburgh

Old College
South Bridge
Edinburgh, Scotland EH8 9JY
United Kingdom

Stewart Player

University of Edinburgh

Old College
South Bridge
Edinburgh, Scotland EH8 9JY
United Kingdom

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