3.7 To provide additional assurance on whether the Private Finance solution was likely to be within probable budgetary allocations and on value for money, they estimated the likely costs of remaining in occupation of their existing, generally dilapidated estate for another 31 years. Since this approach involved only the minimum investment in the Newcastle Estate, and because it did not incorporate any investment in improved quality of accommodation, the Contributions Agency called it the Do Minimum Option. They considered this Do Minimum Option the next most likely option in the absence of a Private Finance deal.
3.8 In preparing the Do Minimum Option, the Contributions Agency's primary focus was on affordability; that is, whether the likely costs of the Private Finance solution could be borne within probable budgetary allocations. Although they did not know what the future level of budgetary allocations would be, the Do Minimum Option represents an attempt to estimate their requirements over the next 31 years. At that time, the Department's running cost allocations included around £11 million a year paid as an internal charge to Treasury as rent for freehold properties on the Newcastle Estate. The Contributions Agency accordingly included these internal charges in the Do Minimum Option as a cost to them of remaining in existing accommodation. The Treasury agreed with this approach.