The Procuring Authority should work with other government agencies to mitigate against the occurrence of a MAGA event, as detailed in Subsection 3.5.1 (Background). This will require closely managing relationships with other government agencies.
There can also be a threshold value for scope changes which the Procuring Authority can implement without seeking approval from the relevant authority in the government. For example, in the Philippines that threshold is 10% of the total capital value. For any scope changes below the threshold value, the Procuring Authority is required to report the scope change to the financing authority but no approval is required from the financing authority. Approval is required for any scope changes above the threshold. Other jurisdictions may define a material scope change which requires approval from the relevant ministry of finance or equivalent agency.
Managing relationships with other government agencies is one of the topics detailed in Section 3.3 (Stakeholder management).
The procurement regulations and other applicable laws of a particular jurisdiction may also impact on what the Procuring Authority can do in terms of providing additional funding to compensate for a claim made by the Project Company. For example, the concept of 'state aid' in the EU restricts what a public sector body can provide to a private organisation such as a Project Company and this has to be assessed carefully.
Where the settlement of a claim or approval of a scope change requires additional funding, securing the budget for implementing the scope change should be considered at an early stage of the process. An inability to settle a claim quickly can mean that the claim inadvertently progresses to a dispute. This risk should be mitigated by properly communicating with and working other relevant government agencies, including a ministry of finance or equivalent agency.