a The Agency's estimate of expected costs was 27-43 per cent higher than the bids it subsequently received. The Agency should investigate why its estimates were much higher than the bids, and identify lessons to improve future estimates. In future projects the Agency needs to use its recently improved processes to ensure it is putting together robust estimates of costs. This is particularly important where the Agency relies on them to demonstrate value for money and to plan how much money is available for other projects.
b The Agency continues to rely heavily on advisers at considerable cost. Within current budgets, the Agency needs to build its in-house commercial and technical capability for considering alternative technical solutions, procurements and contract management, and reduce its reliance on advisers. It must ensure it has good internal knowledge of projects.
c The Department is testing demand management techniques to maintain the benefits of the widening over the longer term, but does not expect results until 2012. The Department must ensure that it has a robust benefits realisation plan for the widening, with appropriate measures to obtain maximum benefit. The Department and the Agency should develop a strategy, by 30 June 2011, for managing the risks to introducing demand management.