Change protocols in PFI/PF2
Change protocols in PFI/PF2

The following Construction guidance note provides comprehensive and up to date legal information covering:

  • Change protocols in PFI/PF2
  • What is the change protocol?
  • Procurement law implications
  • Types of changes
  • Drafting a change protocol
  • Change protocol process
  • Change protocol consequences
  • Documenting a change

This Practice Note looks at the change protocol (also known as the change mechanism) typically found in the Project Agreement relating to a PFI or PF2 (sometimes referred to as PFII) project. It considers the purpose of the change protocol, different types of changes, the change process, the consequences of changes and also the procurement law implications.

In the 2018 Budget (delivered on 29 October 2018), it was announced that the government will no longer use PF2 on new projects (see News Analysis: Budget 2018—what does it mean for infrastructure and housebuilding?). However, the government has stated that it will continue to support private investment in infrastructure and some of the existing drafting may be relevant in such cases. In addition, existing PFI and PF2 projects will continue to run, and given the typical lifespan of such projects this is likely to be for many years.

What is the change protocol?

The long duration of PFI and PF2 contracts meant that it was very important to future-proof them at the point of entering into the contract. Technological developments, changes in law, shifts in political winds, demographic variations and many other factors can all lead to the project as originally envisaged ceasing to be fit for purpose over time.

In those situations it is usually preferable for the Authority to re-shape the project