To ask the Solicitor-General what the total liability to the Law Officers’ Departments would be in circumstances of immediate termination of all (a) public-private partnerships and (b) public finance initiative contracts. (109300)

Of my Departments, only the Crown Prosecution Service is affected by this question. The CPS has a 10-year public finance initiative partnership with LogicaCMG.

The contract with LogicaCMG covers the provision, support and refresh of the hardware and software applications used by the CPS.

The cost of terminating this contract is currently estimated to be £85.3 million. This estimate excludes any costs associated with the Department’s contractual responsibility regarding redundancy or Transfer of Undertaking (Protection of Employment) Regulations 1981 (TUPE) as it would be possible to calculate these costs at a disproportionate cost.

To ask the Solicitor-General what (a) public-private partnerships and (b) private finance initiative contracts have been entered into by the Law Officers Departments; what assets were transferred to the private sector as part of each deal; what the value of these assets was; what the total cost is of each contract; and what estimate was made of the cost to the Law Officer’s Departments of traditional procurement over the life of each contract. (109342)

The CPS is the only one of my Departments covered by this question. The CPS started a 10-year private finance initiative (PFI) partnership with LogicaCMG in 2001.

The contract with LogicaCMG covers the provision, support and refresh of the hardware and software applications used by the CPS. At the start of the contract all CPS owned IT assets were transferred to LogicaCMG. The value of the assets transferred was £21 million. The total service cost of this contract over the 10-year period is forecast to be £250 million. This is a projection of the supplier. The unitary charge payment is conditional on the performance of the supplier. The unitary charge payments cover the cost of service provision, capital repayment, technical refresh and inflation.

The business case for the procurement of this contract compared two feasible options (a) a PFI/public-private partnership (PPP) approach. This meant that there was a single prime contractor for all ICT infrastructure and case management services and expenditure would be transaction and business outcome based and (b) a public sector comparator (PSC) approach. This was based upon a prime contractor for IT infrastructure services, a prime contractor for case management system services, a prime contractor for wide area network services, and a prime contractor for consultancy services. Expenditure would have been a mix of capital investment and running costs.

A cost comparison of the two approaches showed that the total service costs (undiscounted) for the PFI approach was similar as the PSC approach (£327 million) because the PFI option total cost of £359 million contained a total of £31 million for contingency, and to account for transfer of the CPS’s IT assets to LogicaCMG.

One of the major benefits of the PFI approach was that risks would be transferred to the supplier. When risk allocations were taken into account, the PFI approach (£359 million) was estimated to save £41 million over the risk adjusted PSC approach (£400 million).