The core-Department is currently undertaking one private finance initiative (PFI) project to provide office facilities at Brooklands Avenue, Cambridge. There are, however, a number other PFI and PPP projects being undertaken by DEFRA's sponsored bodies i.e. non-departmental public bodies (NDPBs) and public corporations. Information about the total direct liability to the Department or its sponsored bodies in circumstances of immediate termination of each private finance initiative (PFI) and public/private partnerships (PPP) contract is set out in the following table. It must be stressed, however, that information on termination liabilities can be highly speculative as such liabilities depend on the exact circumstances of a termination, and that the costs involved to the Department will depend on these individual circumstances. The termination liabilities to the Department, for example, will be different if the Department itself voluntary terminates a contract compared to termination by another party. The liabilities to the Department arising from third party termination are particularly hard to determine in advance.
Organisation Description Category Liability Environment Agency Broadland Flood Alleviation Project PFI 12 months notice of termination required. If the Environment Agency terminates the contract it is directly liable to pay an estimated £31 million to Broadland Environmental Services Ltd. Environment Agency Pevensey Bay Sea Defences PFI 12 months notice of termination required. If the Environment Agency terminates the contract it is directly liable to pay an estimated 2. 5m to Pentium Coastal Defence Ltd DEFRA Office facilities at Brooklands Avenue, Cambridge PFI DEFRA has no express right of termination. Liability relating to termination would, therefore be subject to negotiation. Natural England (successor to Countryside Agency) SPIRIT IT Systems PFI The SPIRIT PFI contract between Natural England and IBM will shortly come to an end. There are no termination charges or other liabilities associated with this contract British Waterways Watership Pub Partnership PPP There is no specific penalty clause in the agreement for termination. These PPPs have shareholder agreements. If any party decides to exit from the agreement their shares have to be sold to their partners or a third party. Sale of these shares depends on the market, stage of project development etc. British Waterways Wood Wharf (London) redevelopment PPP As above British Waterways Isis- development of river and canal side PPP As above Although they are not DEFRA projects, the Department also provides support in the form of PFI credits to allow Local Authorities to enter into PFI contracts to provide waste recycling and management facilities. Since these PFI contracts are essentially between the Local Authority or Partnership and the Service Provider (i.e. PFI contractor), there will be no direct liability to DEFRA in a situation where a DEFRA sponsored PFI contract is terminated.