2.18 The Treasury and Exchequer Partnership invited a large number of funders to compete for the financing. There were two reasons for this; (i) by inviting a large number of institutions to apply they aimed to get the widest possible acceptance of the standard terms and conditions, and, (ii) as the first funding competition of this kind for a public sector project, it was thought that inviting a large number of institutions would increase the chances of success. The burden placed on the institutions was reduced by initially asking only for indicative pricing, without internal credit committee approval.
2.19 In future competitions, equally careful thought will need to be given to the number of institutions invited to enter. There is a danger that, if too many institutions are invited, they will be reluctant to bid, on the basis that they have only a small chance of winning. At the same time, there is the need to invite a sufficient number of institutions to ensure that competitive tension will be maintained during the process. It is judgements such as this, that will have an impact on the success of the competition, that highlight the additional responsibilities of running a funding competition and the need for an experienced public sector project management team and good advisers.