1 The Department's National Network Group follows good practice by establishing clearly separate responsibilities for determining what is to be bought, awarding the franchise contract and monitoring contract implementation. It describes this approach as 'Plan - Buy - Do':
| 'Plan' (Specification) | 'Buy' (Procurement) | 'Do' (Service Delivery) |
Responsible Person | Director of Rail Strategy and Stakeholder Relations | Director of Procurement | Director of Rail Service Delivery |
Summary of Responsibility | Senior Responsible Officer for the project Management of the overall Franchise Replacement process and individual projects Defining and maintaining the specification to ensure the right strategic fit | Management of the overall procurement process, i.e. the bidding process and evaluation of bids Providing contractual approval for the Franchise Agreement | Overseeing the mobilisation of a new franchise and ensuring that Franchise Agreement obligations are delivered |
2 The Department's governance structure for franchising involves three internal bodies with their responsibilities clearly delineated, as set out below:
Body | Membership | Remit |
Rail Investments Board | Director-General (chair) and Directors of NN Group within the Department | The Board reviews papers and advises the Director General National Networks on the financial approvals and contract award endorsement. |
Franchise Award committee | The Director or Head of each function in 'Plan - Buy - Do'. | Approves public advertisements and invitations to tender; evaluation weightings; recommends contract award and generally ensures best procurement practice. |
Franchise Replacement Steering Group | Representatives of 'Plan - Buy - Do' responsible for the specific franchise. | consider and inform the specification; review the risk register; confirm readiness at each stage; consider major procurement issues arising; and consider mobilisation issues. |
Source: National Audit Office summary | ||
3 The franchising process is subject to review through three mechanisms:
■ External review by the Office of Government Commerce (OGC) which carries out a gateway review at critical stages of the franchising process. OGC has not had any major or unresolved concerns in its reviews of the franchising process.
■ Internal review of the process by the Department's Internal Audit function.
■ Review by the NN Group itself after each franchise award. This can lead to changes, for example, setting more precise criteria for judging financial risk in summer 2007.