3.2 Whilst the appraisal of procurement options at Stage 1 (Programme level) will inevitably involve some uncertainty, it does provide procuring authorities with a rational framework to consider whether PFI is likely to deliver VfM. The objectives of the Stage 1 programme level assessment are summarised in Box 3.1 below.
| Box 3.1: Objectives of Stage 1 • provide an early assessment of whether PFI is likely to provide VfM for a programme of investment in public services, and an indication of the suitability for individual projects within the programme; • increase transparency and improve deal flow; • assist departments as a whole, during the spending review process, in deciding: o allocations between capital and revenue budgets; o the volume and scale of work programmes to be supported, given the amount of capital and revenue funding available; and o the affordability of investments i.e. estimating the cost envelope for programmes; and • ensure departments and procuring authorities have in place the necessary framework (both in terms of structure, skills, and capacity) to implement a PFI programme in a manner which ensures optimal VfM and minimises transaction costs for both the public and private sectors. |