The £4.2M PFI Cleaning Contract Nobody Questioned – Until Now

You’re 15 years into a 25-year PFI contract.

The cleaning spec hasn’t changed.
The building hasn’t changed.

But the cost has quietly ballooned by 47%.

We recently benchmarked a Building Schools for the Future (BSF) portfolio where soft services were costing £18/m².
Market rate was around £11/m² for a comparable education estate.

Same buildings.
Same scope.
Same term-time pattern.

The pain point?

• No baseline.

• No comparison.

• Just annual indexation on a model that was never stress-tested.

By re-basing their service model using current unit rates and realistic staffing productivity data, we identified £1.1M per year in potential savings without touching service quality.

So here’s the uncomfortable question for any school, trust, or authority in a PFI:

When did you last benchmark your PFI soft services against the market?

1. Where we are now: PFI in UK education

PFI in education isn’t a niche issue – it’s the backbone of a large part of the school estate.

• As of March 2024 there were 665 live PFI contracts in the UK, with a capital value of around £50 billion. Around 79% of that relates to “social infrastructure” such as schools and hospitals. UK Parliament+1

• In education specifically, recent analysis shows 219 active PFI contracts, with 170 for schools in England alone – the highest number in any sector. Schools Week

• These deals typically run for 25–30 years, with unitary charges stretching into the 2040s

Within those unitary charges, hard and soft FM (including cleaning, catering, security and grounds) account, on average, for around 60% of the total payment, once you look past the financing and lifecycle elements. University of Greenwich

So when the FM component is out of line with the market by 20–40%, you don’t just have a small efficiency issue.
You have a structural drain on the revenue budget of your school, trust, or local authority.

And yet, many of these contracts have rolled forward for 10–20 years with no serious challenge to the soft services cost base.

2. Why PFI soft services quietly drift above market

Most PFI issues in education aren’t about buildings falling down.
They’re about value quietly leaking from the revenue line.

From what we see in benchmarking and tender work, there are five common reasons PFI cleaning and other soft services drift away from market reality.

2.1 The “black box” unitary charge

The classic PFI model wraps construction, lifecycle and services into a single unitary charge, treated as a revenue line rather than capital. Atkin Chambers+1

Over time, finance teams focus on the total annual payment, not the granular split between:

• Hard FM

• Soft FM (cleaning, catering, security, grounds)

• Lifecycle

• FM management and overheads

If no one has decomposed that unitary charge for several years, it’s easy for soft services to become over-priced and under-examined.

2.2 Indexation without interrogation

Most PFI contracts link the unitary charge to an inflation index.

Over 15–20 years, even modest annual increases compound significantly. Meanwhile:

• Cleaning methods improve

• Equipment productivity increases

• Pay structures and staffing models evolve

But the original baseline often isn’t re-tested against current practice.

You end up with 2025 prices sitting on 2008 staffing models.

2.3 Benchmarking clauses that never bite

Many PFI contracts include benchmarking or market-testing provisions for soft FM – especially cleaning, catering and grounds. partnershipsuk.org.uk+1

On paper, these are meant to:

• Test prices against current market rates

• Adjust the contract if costs are demonstrably out of line

In practice, we see three issues:

1. Benchmarking is triggered late – often only when relationships are strained.

2. The process is poorly prepared – no agreed baseline, scope, or performance framework.

3. Authorities lack independent benchmarks, so the contractor’s data becomes the default truth.

The result? Benchmarking becomes a tick-box exercise rather than a genuine value reset.

2.4 No external reference point

Contrast that with the Department for Education’s own spending and benchmarking tools, where schools can compare premises and cleaning costs against similar institutions.

In one DfE example, a school’s premises staff and services costs (including cleaning and caretaking) were £74/m², compared to £48/m² for similar schools – a 55% gap clearly flagged for action. financial-benchmarking-and-insights-tool.education.gov.uk+1

Most PFI authorities do not have that kind of clean, external benchmark for their PFI soft services.

Without it, you’re negotiating in the dark.

2.5 Focus elsewhere: estates risk and RAAC

Over the last few years, estates teams have been consumed by:

• RAAC risk and emergency mitigation National Audit Office (NAO)+1

• Backlogs in building condition

• Capital funding uncertainty and school rebuilding programmes

Recent analysis suggests that as PFI contracts end, schools, trusts and councils could face up to £4 billion in unplanned maintenance costs to keep buildings safe and operational. Schools Week

When you’re fighting those fires, it’s easy for “invisible” services like cleaning to avoid scrutiny—especially if the toilets are clean and the floors are shiny.

But that’s exactly why soft services become the hidden opportunity in a PFI portfolio.

3. The £18/m² problem: what we actually found

Back to that BSF portfolio.

We were asked a simple question:

“Are we getting value for money from our PFI soft services?”

Here’s what we uncovered.

3.1 Step 1 – Split the unitary charge

We started by decomposing the unitary charge across:

• Hard FM

• Lifecycle

• Soft FM (cleaning, catering, security, grounds)

• FM management and overheads

Soft services were significantly higher than we’d expect for an education estate of that size and complexity.

3.2 Step 2 – Build a proper baseline

We built a detailed baseline, including:

• Gross internal floor area by building and use type

• Cleaning frequencies (classrooms, circulation, toilets, specialist areas)

• Term-time patterns

• Staffing structure, shift patterns, and supervision

• Historic performance and KPI data

This gave us a clean £/m² position for each service line, rather than a single blended rate.

3.3 Step 3 – Benchmark against market

Using current market data from our tendering work in education and wider FM, we compared:

• £/m² cleaning costs across BSF, academies and non-PFI schools

• Productivity assumptions (m² per hour by area type)

• Supervisory ratios and overhead loadings

The flagship issue: cleaning costs at £18/m², where a realistic market benchmark was around £11/m² for a similar specification and risk profile.

3.4 Step 4 – Re-base the model

We didn’t just slash the rate. We rebuilt the service model:

• Reset productivity assumptions to realistic but efficient levels

• Re-profiled staffing around actual occupancy and curriculum use

• Tightened service standards in high-risk areas; rationalised in low-risk zones

• Protected compliance and safeguarding-critical activities

When we rolled the revised model through the contract term, we identified:

£1.1M annual saving
Without reducing service quality
And without undermining the contractor’s ability to deliver profitably

That’s the power of evidence-based benchmarking on a large, long-term PFI.

4. How to stress-test your own PFI cleaning contract

If you’re 10–20 years into a PFI, you don’t need to wait for expiry to act.

Here’s a practical roadmap we use when authorities ask us to review PFI soft services – particularly cleaning.

Step 1 – Surface the numbers

Start with three simple questions:

1. What percentage of the unitary charge relates to soft FM?

2. Within that, what is the cleaning cost per m²?

3. How has that changed over the last 5–10 years?

If you can’t answer those in under an hour, that’s your first red flag.

Step 2 – Rebuild the baseline

Bring together:

• Building layouts and floor areas

• Current cleaning specifications

• Term dates and extended use patterns

• TUPE and staffing data (hours, roles, locations)

From there, calculate:

• Hours by area type

• m² per hour by area

• Total £/m² per building and across the estate

The aim is transparency, not immediate challenge.

Step 3 – Benchmark ruthlessly

Use multiple reference points:

• DfE and trust-level benchmarking where applicable financial-benchmarking-and-insights-tool.education.gov.uk+1

• Market unit rates from recent FM and education tenders

• Independent productivity norms for each area type

You’re not looking for perfection.
You’re looking for signals:

• Are you 10–20% above market?

• Or 30–40%+ above, as we often see?

Step 4 – Understand your contract levers

Most PFI contracts include at least one of:

• Benchmarking provisions – comparing soft services costs to market

• Market testing – re-tendering elements of the services

• Change mechanisms – allowing you to re-scope services formally

You need to know:

• When these can be triggered

• What evidence is required

• What margin and risk principles apply

This is where estates, legal, finance and FM teams need to work as one.

Step 5 – Build a fair re-based model

Any revised model must be:

• Deliverable – realistic productivity and staffing levels

• Defensible – grounded in data, not wishful thinking

• Balanced – protects quality where it matters most (hygiene, safeguarding, compliance)

In other words, it should feel like a fair deal for both sides – not a one-sided cost-cutting exercise.

Step 6 – Negotiate from evidence, not emotion

Too many PFI discussions fall into blame or history lessons.

A better approach:

• Share your analysis transparently

• Acknowledge legitimate contractor constraints

• Focus on future value, not past decisions

• Explore options: re-based unitary, service re-design, gain-share mechanisms

We’ve found that when both sides can see the same numbers, it’s far easier to land on a pragmatic solution.

5. Why this matters now: PFI exit and the next 10 years

The conversation about PFI value is no longer theoretical.

• Annual charges for PFI and PF2 deals reached over £10 billion in 2016–17, with future payments locked in for decades. National Audit Office (NAO)

• Independent research shows that in many cases, total payments over the life of PFI contracts will be over three times the original construction cost, with a significant portion going on interest and profit rather than front-line services. The Times

• As contracts end, schools face a double hit – unplanned capital and maintenance liabilities, plus revenue budgets already under pressure. Schools Week+1

If you’re an estates director, PFI manager, or CFO in education, the next 5–10 years are going to be defined by:

1. Managing PFI exit risk – ensuring buildings remain safe, compliant and functional. National Audit Office (NAO)+1

2. Re-procuring FM under new regimes – including the new Procurement Act frameworks.

3. Releasing headroom in revenue budgets – to fund teaching, support, and targeted capital works.

You can’t do any of that effectively while your cleaning and soft services are stuck on 15-year-old assumptions.

6. What “good” looks like for PFI soft services

From our work across schools, colleges and wider public sector estates, high-performing PFI arrangements share a few traits:

• Transparent unitary charge breakdown – everyone understands what they’re paying for.

• Regular, structured benchmarking – using independent data at least every 3–5 years. Local Partnerships+1

• Contract levers actually used – benchmarking and market testing aren’t seen as “nuclear options”.

• Joint performance dashboards – estates, finance and the SPV share a single version of the truth.

• Thoughtful service redesign – cleaning specs aligned to risk, usage, and education outcomes, not just “how we’ve always done it.”

The goal is simple:

PFI should deliver a managed, predictable, value-for-money service – not a 30-year premium you’re too busy to challenge.

7. Where EMC comes in

At EMC, we sit at an unusual intersection:

• We benchmark FM and soft services across multiple sectors, not just schools.

• We run education-specific tenders outside PFI, so we see real, current market rates.

• We understand the contract mechanics of PFI – and how to use benchmarking, market testing and change controls without triggering chaos.

In practical terms, that means we can help you to:

• Deconstruct your unitary charge and isolate the true cleaning cost per m².

• Build a robust, auditable baseline for your soft services.

• Benchmark your PFI FM costs against live market data.

• Re-design service models to protect quality while removing waste.

• Support negotiations with the SPV/contractor using clear evidence, not opinions.

• Shape your post-PFI FM strategy, so you’re ready well before expiry.

For one BSF client, that meant £1.1M annual savings on soft services without reducing cleaning quality.

For you, it might mean:

• Funding extra teaching assistants

• Tackling critical maintenance backlogs

• Creating financial headroom for RAAC or condition-related works

All by re-balancing a contract that’s been quietly overcharging for years.

Final question

If you’re 10, 15, or even 20 years into a PFI:

When did you last benchmark your PFI soft services against the market?

If the answer is “we haven’t” – or “not in the last five years” – that’s the starting point.

If you’d like EMC to carry out a PFI Soft Services Benchmark Review on your school, trust or local authority portfolio, we’re happy to have an initial confidential conversation.

You might not have a £4.2M cleaning contract.
But you may still be leaving six or seven figures on the table every year.