5.8 Supplementary VfM Calculations (VfM (1) to (5))

5.8.1 The VfM Quantitative Assessment Spreadsheet is incorporated in the Model in the Supplementary VfM Calculations worksheets ('VfM (1)' to 'VfM (5)'). As such, the user is directed to the guidance supporting this spreadsheet - "Quantitative Assessment User Guide" (published by HMT, March 2007).

For consistency with this Model, worksheet names have been changed from those given in the VfM Quantitative Assessment Spreadsheet. The read across between the two is as follows:

DCLG HRA/non-HRA Template Financial Model	VfM Quantitative Assessment Spreadsheet
VfM (1)	Input
VfM (2)	Input Assumptions
VfM (3)	Output - Indifference
VfM (4)	Output - Stashed Scenarios
VfM (5)	Output - Sensitivities

5.8.2 The main difference between the two models is that the worksheet 'VfM (1)' is no longer an input sheet in this Model. All inputs to the Supplementary VfM Calculations are via the two user input worksheets 'I (Gen)' and 'I (Time)'. Worksheet 'VfM (1)' has been retained however with the supporting notes worksheet 'VfM (2)' as these outputs will still be required for PRG review.

As a result of this, the VfM sections of the input worksheets refer to HMT's Quantitative Assessment User Guide where relevant (see sections 5.3 and 5.4).

	Option Appraisal : Public Sector Comparator

	Option Number :


	Project Start Date	Apr-04
	Price Base Date	Apr-04
	Discount Rate (Real)	3.50%

	Year Commencing					Apr-04	Apr-05	Apr-06	Apr-07	Apr-08	Apr-34
	Project Year					1	2	3	4	5	30
	Discount (Mid-Year)					0.5	1.5	2.5	3.5	4.5	29.5
	Discount Factor					0.982946	0.949707	0.917591	0.886561	0.856581	0.36246

			TOTAL £'000	NPV £	000
	Capital Expenditure - Repairs
	Refurbishment		8000			1000	1000	2000	2000	2000
	Lifecycle - Element Replacement		5000								200
A	Total Capital Expenditure - Repairs		13000			1000	1000	2000	2000	2000	200

	Capital Expenditure - Improvements
	Leaseholder Improvements		2500			500	500	500	500	500
	Other capital improvements to stock		750			150	150	150	150	150
B	Total Capital Expenditure - Improvements		3250			650	650	650	650	650

	Capital Expenditure - Other
	Demolition Costs		1000			1000
	Temporary Accommodation		500			100	100	100	100	100
	Site Costs		150			30	30	30	30	30
	Decanting Costs		200			40	40	40	40	40
	Professional Fees (Incl Surveys)		250			250
C	Total Capital Expenditure - Other		2350			1420	170	170	170	170	0

	Capital Expenditure - New Build Units
	Construction Costs		6500			2000	3000	1500
	Land Acquisition		1000			1000
	Demolition Costs		600			600
	Temporary Accommodation		0
	Site Costs		90			30	30	30
	Decanting Costs		0
	Professional Fees (Incl Surveys)		150			150
	Lifecycle - Element Replacement		5000								200
D	Total Capital Expenditure - New Build Units		13340			3780	3030	1530	0	0	200

	Operating Expenditure - Maintenance
	Lifecycle - Maintenenace and Minor Repairs		7500			250	250	250	250	250	250
E	Total Operating Expenditure - Maintenance		7500			250	250	250	250	250	250

	Operating Expenditure - Management
	Housing Management		1800			60	60	60	60	60	60
	Facilties Management		3600			120	120	120	120	120	120
	Insurance		2250			75	75	75	75	75	75
	Leasehold Management		1800			25	25	25	25	25	25
F	Total Operating Expenditure - Management		9450			280	280	280	280	280	280

	Option Specific Income
G	Capital Receipts - Refurbishment Units		1500			250
H	Capital Receipts - New Build Units		500			500
I	Leaseholder Recoverables - Capital		600			20	20	20	20	20
J	Leaseholder Recoverables - Revenue		150			5	5	5	5	5	5
	Total Option Specific Income		2750			775	25	25	25	25	5

	Risk Adjustment
K	Capital Expenditure -Repairs
L	Capital Expenditure -Improvements
M	Capital Expenditure - New Build
N	Operating Expenditure - Maintenance
O	Operating Expenditure - Management
	Total Risk Adjustment

	NET CASHFLOW


P	Number of Units - Refurbishment					1000	1000	1000	1000	1000	1000
Q	Number of Units - New Build					250	500	750	1000	1000	1000

	ODPM Inputs
(A+K-G)/P	Cost per Unit - Repairs					750	1000	2000	2000	2000	200
(B+L-H-I)/K	Cost per Unit - Improvements					630	630	630	630	630	0
C/(P+Q)	Cost per Unit - Other					1420	170	170	170	170	0
(D+M-H)/L	Cost per Unit - New Build					1780	3030	1530	0	0	200
(E+N)/(P+Q)	Cost per Unit - Maintenance					200	167	143	125	125	125
(F+O-J)/(K+L)	Cost per Unit - Management					224	187	160	140	140	140