3.4 National Savings appointed advisers in good time following competitions in which success depended on the quality of advice on offer, having regard to price. Budgets were prepared to monitor advisers' fees against actual costs (Figure 11). The overall budget for both the original accommodation project and the partnership to run the operational service was exceeded by 14 per cent. This included unplanned expenditure on the accommodation project of £253,000. The scope of the accommodation project was extended beyond initial expectations and took longer than expected to define. This resulted in the need for a greater level of professional advice. When extra spending was proposed, however, National Savings' project board and finance directorate scrutinised the proposals and authorised further spending so that budgets were never exceeded without authority.
Cost of National Savings advisers | Figure 11 |
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| This figure shows that National Savings exceeded its budget by 14 per cent | ||||
| Adviser | Budget £000s | Actual £000s | Variations £000s | |
| Operational Services |
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|
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| PA Consulting | 1,519 | 1,609 | 90 | |
| Herbert Smith | 722 | 902 | 180 | |
| Dresdner Kleinwort Benson | 325 | 280 | (45) | |
| Other | 139 | 102 | (37) | |
| Total | 2,705 | 2,893 | 188 | |
| Accommodation |
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|
| |
| Herbert Smith |
| 200 |
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| Richard Ellis |
| 187 |
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| Dresdner Kleinwort Benson |
| 109 |
| |
| Other |
| 105 |
| |
| Total | 348 | 601 | 253 | |
| Overall Total | 3,053 | 3,494 | 441 | |
| Notes: | 1. These figures exclude VAT. 2. Other operational services advisers: Corporate Value Associates; Arthur Andersen; Central Computer and Telecommunications Agency and Government Actuary's Department. 3. Other accommodation advisers: Edmund Kirby; PACE and Burness. 4. Expenditure shown under accommodation represents 86 per cent of the cost of advisers for the separate accommodation deal before it was incorporated into the main operational services PFI deal. |
Source: National Savings |
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