John Hutton speech to CMS conference: time to get Britain building again - Neighbourhood Health Centres, Hospitals and Prisons

Lord (John) Hutton, Chair of the Association of Infrastructure Investors in Public Private Partnerships, spoke at a conference organised by international law firm CMS on Tuesday 11 November 2025.

As the chair of the UK’s main trade body for PPP, Lord Hutton issued a clear call for Government:

“Getting Britain building again – neighbourhood health centres, hospitals, and dare I say it prisons – is our collective mission – and we know from the NAO that PPPs are three times more likely to deliver ‘on time and on budget.’

While welcoming the Government’s express commitment to new PPPs for Neighbourhood Health Centres, which is expected to be confirmed in the Budget, Lord Hutton continued: “Government should be much bolder in new thinking to get on with building social infrastructure. We believe the New Hospitals Programme should be tasked with developing new PPP deals to speed up the programme. We have the expertise and the investment ready to work with government.”

Lord Hutton also argued that “extending existing contracts is a fast and effective way, in a capital constrained environment, of making a demonstrable improvement to social infrastructure in this parliament. There could be quick injections of capital into Trusts to upgrade and add new capacity…5,400 clinical service incidents occur in the NHS every year due to property and infrastructure failures – a serious failure in service that has economic impacts. Rebuild our crumbling wards, make them fit for purpose and meet our obligations to tackle climate change.”

He also issued a warning for Government on the risk of insolvency for major UK investors: “The Centre of Best Practice is creating a significant conflict between the approach of government and what would in any way be acceptable to investors. We have engaged with DHSC, with NISTA  and with Ministers to understand that this route would lead only to conflict and costs of that conflict. Projects must be given the space to rectify, and held to account when they do not, but without the threat of insolvency as a tool of negotiation.”

The full text of his remarks is below.

Lord Hutton was joined by a panel of industry experts from InfraRed Capital Partners, Assured Guaranty, The Welsh Education Partnership, Curshaw Commercial, InfraConsult and others.

Ahead of the Chancellor’s Budget, this was a critical moment to discuss the factors that have led to PPP projects in certain sectors becoming distressed and how that can be avoided or resolved. 

In that context, given the government’s plans for infrastructure over the next 10 years and their expectations of requiring private capital for some of their projects in the pipeline, there was a discussion about exploring new models for PPP taking into account lessons learned from over 30 years of operational projects.

Other conference panellists included Marc Evans, Charles McLeod, Frances Garratt, Max Curzon-Hope, Tamzin McLean and Christian Stanbury were, who discussed the need for new PPP models and some of the upcoming challenges in the industry.

AIIP would like to thank CMS and Paul Smith for hosting such a thought provoking conference.

CMS Conference November, 2025

Thank you for welcoming me this morning to a fine example of a public private partnership building that is these offices in Cannon Street. Built by the developer, Hines, in partnership with Network Rail to remodel and rebuild the historic station that had over time fallen into disrepair, with the original grand station being bombed in the war.

The name of Cannon Street itself is not related to the firearm but was shortened over time from “candlewick street” and was the historic home of the candle making industry of London.

I can, therefore, use the metaphoric opportunity of this place to give you the image of building under Public Private Partnerships as like a candle: its purpose is to deliver light — dependable performance — for the full length of its wick. That longevity is the value. The challenge for policymakers is not to judge it in the first flicker of the flame, but across the whole burn. How long and how well that light lasts depends on how we look after it: steady stewardship, maintenance, and the right environment to let it do what it was designed to do.

Public Private Partnerships have contributed great things to British life.

They have built hospitals and schools that otherwise would never have come into existence.

They have built roads and railways and maintained countless other critical assets.  It has provided not only resources - but speed, innovation, and vision.

Because at its heart, PFI itself connects private expertise with public purpose, and for the common good.

And it has shown that when we work together - public and private sectors - we build infrastructure that lasts, and that can better serve the needs of our nation.

As very short background, the Association of Infrastructure Investors in Public Private Partnerships was formed in October 2023 by several major international infrastructure investors that have Public Private Partnership assets.

We aim to provide a positive and co-ordinated voice for engagement based on shared expertise on prioritising, planning, maintaining, operating, and handing back infrastructure projects.

I think over our reasonably short life we have gained a strong reputation and our membership has grown as a result. In two years we’ve gone from a start up to representing 70% of the UK PPP market, and our members have £50bn of assets under management. While I’m conscious success has many parents, I’m delighted that after extensive discussions with ministers and officials the Government has signalled it could end the moratorium on new PPPs in social infrastructure, albeit we would like to extend the use cases.

Getting Britain building again – neighbourhood health centres, hospitals, and dare I say it prisons – is our collective mission – and we know from the NAO that PPPs are three times more likely to deliver “on time and on budget”.    

“Are We Reset Yet”

The title today is “Are We Reset Yet” and I suspect we know it would be a very short conference, and indeed a short speech, if the answer was “yes”.  We have all worked through a long process that has acknowledged the problems, seen serious impacts at a project level and several different and some might say competing government approaches to resolving the process without, in our mind, a satisfactory conclusion as yet.

On our part, we have been working behind the scenes with officials and advisors and more formally with Ministers, including the Chief Secretary of the Treasury, to find ways through the Reset process that work for both sides.

Serious in the need to have a process to engage in partnership on survey and rectifications. Ensuring that projects are able to embark on that rectification without the instability of adversarial contract management.  Building a relationship with central government that can work down through the departments and the managers of assets to have a common approach built on trust and focused on outcomes.

This has not been an easy road, and is by no means yet resolved. The Centre of Best Practice is creating a significant conflict between the approach of government and what would in any way be acceptable to investors. We have engaged with DHSC, with NISTA  and with Ministers to understand that this route would lead only to conflict and costs of that conflict. Projects must be given the space to rectify, and held to account when they do not, but without the threat of insolvency as a tool of negotiation.

This engagement has made a difference. NISTA has intervened to say they understand that this approach would not work and AIIP has the mandate to work with NISTA to resolve the way Reset works on behalf of our members. But we still have to get that agreement, and in a timely manner, as projects continue to be assessed under CoBP in lieu of an alternative.

It is important to us that any process that comes out of the discussions bites on contracting authorities and that the process is followed. NISTA is in its infancy, but we need to see it as a proper counterparty for discussions – able to ensure that any agreement is kept to.

We want to reduce the volume of disputes and value leakage to lawyers, conscious as I am of my audience, and adversarial consultants. Central Government must exert important influence on what is done at an individual contracting authority level.

New Models of PPP

The Budget is scheduled for an announcement of the conclusion to the market engagement process on new models of PPP in delivering Neighbourhood Health Centres.

We have always been encouraging of looking at new models of PPP, but we have also emphasised that if we can resolve the approach to current disputes this will have a significant impact on the appetite for future investment.

AIIP believes that Government should be much bolder in new thinking to get on with building social infrastructure. We believe the New Hospitals Programme should be tasked with developing new PPP deals to speed up the programme. We have the expertise and the investment ready to work with government if it is serious in its desire to rebuild the social infrastructure of the country. We need scale of projects, in return we can bring speed and high standards of delivery.

AIIP members have shown the benefits to the long-term infrastructure needs of the UK by building on time, on budget and managing the upkeep of critical social infrastructure, to a far higher standard than the non-PPP public sector estate over the lifetime of the assets.

Extensions

One issue we have also raised with government is the potential to look at existing contracts and extend to allow recapitalisation.

Extending existing contracts is a fast and effective way, in a capital constrained environment, of making a demonstrable improvement to social infrastructure in this parliament. There are a significant number of PFI contracts coming up to end of term and handback under this Government. There could be quick injections of capital into Trusts to upgrade and add new capacity, give opportunity for, e.g. net-zero pathways, deliver Resets consistent with NISTA guidance, and start to pilot some of the terms under which new PPP models could be designed. 5,400 clinical service incidents occur in the NHS every year due to property and infrastructure failures – a serious failure in service that has economic impacts. Rebuild our crumbling wards, make them fit for purpose and meet our obligations to tackle climate change.

There is already a mixed contracting market where some of the PFI contracts in place explicitly allow for mutually agreed extensions, others that do not. We believe that this would also be a way to demonstrate new ways of working together, co-operation on contracting that works in a mutually beneficial way and starts to test the very principles we are talking about around reset and new models.

Conclusion

Reset is a process that sits in a context of a different way of looking now, and in the future, at the role of public private partnerships.

The UK government can get the best value for the taxpayer that it seeks, but in a way that also encourages a stable climate for investment.

We would strongly encourage the UK to be serious in the budget about future PPP – it needs to understand the role of that decision in signalling its seriousness of the reputation of the UK for investment. It cannot float the possibility then seem half hearted with funds that are built on the long term.

Equally it needs to understand that pricing the risk of future investment is based very much on how the Government deals with the here and now – resolving the problems in front of it on reset and adversarial relationships that are deeply problematic for funds that have a global outlook.

So we have not Reset yet, but we should be optimistic. This government has moved a long way in recognising that public private partnerships are one of the tools it has to deliver its ambitions on social infrastructure and it now, I think, realises that current relationships are absolutely pivotal to any future investment. Let us see, in short order, whether the detail of that understanding matches the ambition.  

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