Appendix I - Glossary

Competitive Dialogue

Competitive Dialogue is a process which enables the Procuring Authority to conduct discussions with bidders with the aim of identifying and defining the means best suited to meet the Procuring Authority's needs. The dialogue involves several stages during which the number of solutions discussed as well as the number of bidders is refined and reduced.

Conventional Procurement Assessment Model or CPAM

Conventional Procurement Assessment Model is a risk adjusted financial model which estimates the cost of the public sector procuring a project directly.

DBFM

Design, Build Finance and Maintain

FBC

The Final Business Case explains how the preferred option would be implemented and how it can be best delivered.

FM

Facilities Management services - can be hard services relating to the maintenance of the maintaining the fabric of the actual  building or soft services such as cleaning and catering.

Gateway Review

Mandatory reviews for publicly procured capital investments which exceed £5m and which are assessed as being high risk and / or mission critical.

Green Book

HM Treasury Green Book provides guidance on the techniques and issues that should be considered when assessing new policies, programmes and projects, whether revenue, capital or regulatory.

GEM

The Department of Health Generic Economic Model aims to assist the business case process of selecting the option that provides best value for money to the public sector for capital investment.

ITPD

The Invitation to Participate in Dialogue is a key milestone of the Competitive Dialogue process where pre qualified bidders are invited to take part in the dialogue stage.

JV

Joint Venture

KSR

Key Stage Review programme is a mandatory external review process for all privately financed procurements in Scotland.

NPD

The Non Profit Distributing model is a structure which has been  developed in the Scottish market as a means of capping the returns earned by investors on public sector procurement at a level aligned with the corresponding risk transfer.

NPV

The Net Present Value represents a net cost figure for a the receipts associated with the project. The resulting cash flows are discounted at the appropriate cost of capital to an agreed base date.

OBC

An Outline Business Case prepared by the Procuring Authority to establish the need for the project, including an output specification.

OJEU

Official Journal of the European Union in which projects are advertised.

Optimism Bias / OB

Optimism Bias is the demonstrated systematic tendency for people to be over-optimistic about the outcome of planned actions. This includes over-estimating the benefits and under-estimating costs and delays.

PQQ

A Pre Qualification Questionnaire is designed to assess the competence of potential bidders from the expressions of interest submitted in response to the OJEU notice, with the aim of producing a list of potential bidders who qualify for the next stage in the procurement process.

SCIM

Scottish Capital Investment Manual

SFT

Scottish Futures Trust

Shadow Bid Model

A shadow bid model provides an indicative unitary charge which will be used as a proxy for the expected annual cost of a privately financed procurement

SG

Scottish Government

SGHD

Scottish Government Health Directorate

SGHD PFCU

Scottish Government Health Directorate Private Finance and Capital Unit

SoPC4

HM Treasury's Standardisation of PFI Contracts version 4 provides standard wording and guidance to be used by public sector bodies when drafting PFI contracts. This guidance is also applicable to NPD contracts.

SPFM

Scottish Public Finance Manual

STUC Staffing Protocol

Scotland's Trade Union Centre Protocol covers employment issues in Public Private Partnerships in protecting staff and eliminating the two-tier workforce.

Unitary Charge

The expected cost of a privately financed project, usually expressed in annual terms.

VfM

VfM is the optimum combination of whole-life costs and quality (or fitness for purpose) of the good or service to meet the users requirements. VfM is not the choice of goods and services based on the lowest cost bid.