2.14 In order to evaluate whether the deal that is being procured is the best available, departments must always be aware of their best available alternative. This can act as a useful comparator when key decisions need to be taken. The best alternative to the STEPS deal was a business improvement option, which retained the estate in-house, but reduced costs over time through better management of the buildings. The costing of the best alternative in this deal was used as a Public Sector Comparator (PSC).
2.15 The PSC had an inherently high level of uncertainty attached to it as a result of the difficulty of forecasting not only the level of the Departments' accommodation requirements over 20 years, but also the associated running costs and potential income realisable from the estate. To take account of some of these uncertainties, the PSC was prepared for different scenarios. Across the range of scenarios, the price bid by Mapeley STEPS was some £300 million below the PSC (Figure 12). Appendix 5 gives more details of the PSC.