4.4 When considering the initial decision to approve an investment project, the senior responsible officer (SRO) should undertake a full value for money appraisal using the Green Book methodology. The investment decision should be the first step taken in assessing value for money. It should not be confused with decisions on the delivery model or the procurement process. In 20064, the NAO set out a list of key points to be considered in making an investment decision for a PFI project, summarised in Box 4.2. While the NAO report specifically addressed PFI, the points are applicable to complex procurement more generally.
| Box 4.2: NAO key questions in considering the investment decision In 2006 the NAO published a report setting out the issues that need to be considered in evaluating PFI projects. The points set out below are also applicable to major complex projects procured through other delivery models. • Have clear objectives for the project been set? • Does the project meet policy imperatives? • Was the project assessed as being a priority? • Has a preliminary evaluation of the benefits sought been made? • Has long-term commitment to the project been demonstrated? • Are the project outcomes clear? • Have the project's wider socio-economic benefits been quantified? • Does the proposed solution clearly meet business requirements? Source: A framework for evaluating the implementation of Private Finance Initiative projects, NAO, 2006 |
4 A framework for evaluating the implementation of Private Finance Initiative projects, NAO, 2006