Foreword

Over the past few years the National Audit Office (NAO) has reported a number of times on how individual Departments were managing programmes involving PFI and PPPs.1 This has led the NAO to believe that the way Departments manage their programmes plays a key role in achieving success and value for money. As part of this work, Departments have often asked the NAO how they compared, whether the issues the NAO has raised were common to other programmes, and against what scale the NAO was assessing them. But although the NAO's work on PFI and PPP projects has covered nearly all sectors, it did not provide a clear picture of how each Department compared in the management of their PFI and PPP programmes. The NAO felt that it would benefit from finding out, while Departments would benefit from sharing one another's experience.

Meanwhile, HM Treasury (HMT), which has responsibility for PPP policy and ensuring the overall value for money of PFI and PPP investments, wished to examine the best practice Departments demonstrated in delivering PFI and PPP projects. HMT wanted to facilitate the sharing of this best practice across Departments. It also wished to assess whether the skills and experience within teams specialising in delivering PFI and PPP projects could be deployed more widely within Departments in support of other complex investment projects or programmes.

For these reasons, HMT and the NAO jointly approached ten Departments in October 2009 to invite them to share their experience in managing programmes and to explore common themes between Departments. Between October and December 2010 we jointly conducted a series of interviews across Departments. We incorporated our findings from these with our collective back catalogue of work with these Departments to produce the model presented here of the functions common across Departments. We invited the individuals in charge of the Department teams with responsibility for PFI and PPP policy to a seminar in February 2010 to give their feedback on our model.

We are publishing this model to provide guidance to Departments on HMT's and NAO's expectations of how they should manage their programmes involving PPP and PFI projects. We expect that it will also be relevant and useful to any Department or team that is planning to deliver any programme of complex capital investment projects. It is meant to stimulate thought within each Department about whether they are doing as much as they should to manage their programmes in line with current best practice. It is also meant to encourage Departments to talk to one another more about how they manage their programmes, and to explore opportunities to exchange best practice. And it is also meant to stimulate wide ranging debate about whether the current best practice is the best Departments could be doing.

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1  The Operational Performance of PFI Prisons (HC 700, 2002-2003); Department of Health - Innovation in the NHS: Local Improvement Finance Trusts (HC 28, 2005-2006); Allocation and management of risk in Ministry of Defence PFI projects (HC 343, 2007-2008); The Building Schools for the Future Programme: renewing the secondary school estate (HC 135, 2008-2009); Department for Environment, Food and Rural Affairs: Managing the waste PFI programme (HC 66, 2008-2009).