The business case was constructed generally in line with the principles of DTF's Partnerships Victoria Practitioners' Guide (June 2001), as well as DTF's Gateway Business Case Development Guidelines (August 2003), which were issued one month prior to the completion of the business case.
There are no mandatory elements in the DTF guidance; it is the responsibility of the person accountable for the program or project to determine what is required in the business case. The following elements of a business case suggested by the Partnerships Victoria Practitioners' Manual5 were not included in the RWH business case:
• The business case does not discuss why the Royal Melbourne Hospital site option is preferred or the procurement models considered. However, this is documented in the investment evaluation which was presented to the government in March 2003.
• The business case does not explain why government was considered better able to manage or mitigate the retained risks. Certain risks are better managed or mitigated by government. however, the reasonsfor this were not addressed in the business case.
• There were a number of risks that were not quantified. Some risks are not easily quantifiable, and an overview of risk methodology and analysis of non-quantified risks was examined in depth during the development of the project Public Sector Comparator.
• The value of the land at RWH or Royal Melbourne Hospital was not mentioned in the business case. Financial consultants to DHS advised that asset sales and land re-use were not included as part of the potential Partnerships Victoria transaction, as the aim was to attract bidders to build a hospital and provide services for 25 years. DHS and DTF believed there was a strategic risk that if valuable, inner urban land was included, consortia with a focus on property development may enter the bidding process primarily to gain access to a right to on-sell or develop the existing RWH site.
5 Pages 20-23.