We need a New Model PFI

This, make no mistake, was decision time. The unions had savaged the PFI's supposedly poor value for money, booed Treasury minister Paul Boateng off the platform and taken out colossal advertisements on Monday lambasting Jarvis' Paris Moayedi and Atkins' Robin Southwell as "the real wreckers". This was especially ill-timed in Southwell's case – he left Atkins the next day (see news). Mercifully, though, Labour's twin titans delivered the message that it's PFI or nothing. Construction Confederation president John Gains and – most unexpectedly – UCATT boss George Brumwell then weighed in with their support.

Unpopularity is only one of the PFI's ailments, of course. Contractors face new accounting rules that require bid costs to be written off as they are incurred (known in Square Mile as "the Amey factor"); higher risks (remember the National Physical Laboratory?); and diminishing returns (nearer 5% than 10%, but certainly not the 30% that Unison claims). All of these have conspired to put fund managers off the PFI. Meanwhile, CABE chairman Sir Stuart Lipton has alleged that contractors are sacrificing the quality of public architecture to maximise profit.

The Labour leadership's bluster in Blackpool might well have come too late to save the PFI. But there is still hope – if it can be refashioned one last time. The New Model PFI must be cheaper to win, more protective of workers' rights and possess greater architectural merit. As a starting point, contractors have already agreed with CABE to make design a key component of the bidding criteria. The result should be a more viable and responsive PFI industry in which only the best survive and specialise. Instead of a dozen bidders gambling on the odd triumph, there would be two or three, each expecting to win every other tender. Then nobody would be harking back to the mythical golden age of traditional public sector procurement. After all the infantile snarling and wailing by the seaside this week, it's time for the PFI to come of age.

The executive tightrope
More uncertain times lie ahead for firms and, in particular, their bosses. Amid the PFI wars comes word that the sluggish UK economy may hold back Blair's billions and that London's commercial market – which puts the heat into the whole sector – is facing a chilly forecast (pages 24-25). No surprise if you've followed the reports of job losses and profit warnings in the national press, or read predictions that 2.4 million ft² of speculative office space will be available in the capital next year – the highest since, oh dear, 1989. It's not all bad news – output is still outstripping GDP, there's double-digit growth in public housing and transport, and the North's booming (pages 38-45). But the market's fragility comes at a time when bosses are under greater pressure than ever to sustain profitability. Two sets of bad figures, and it could be curtains. Just ask this week's spectacular casualty – Atkins' Robin Southwell, out after 18 months.