Managing Contracts under the UK Private Finance Initiative: Evidence from the National Health Service

Over recent years, a number of contributors to the public management literature have argued that the buyer-supplier relationships generated by the UK Private Finance Initiative (PFI) are qualitatively different from those generated by traditional contracting out. References have been made to equality, transparency, risk-sharing and trust. In this article, the authors test a contrary argument: that UK public managers negotiate and implement PFI contracts within an environment which is, to a significant extent, characterised by supplier opportunism, something that requires them to employ an extremely assiduous, if not necessarily distant, approach to contract and relationship management. The testing of this argument is undertaken with evidence from PFI construction contracts operated within the National Health Service.