Introduction
This chapter is for clients who have not worked in the government field before. It describes what is different about being a government client and signposts the reader to the available guidance.
Each central government department is responsible for managing its own estate with the Government Property Unit (GPU) in the Cabinet Office coordinating overall Government Estate Strategy and monitoring delivery. Each year the GPU publishes a ‘State of the Estate’ report that shows government departments’ performance in the management of their estate and against sustainability targets. These two publications provide a good overview of the government’s estate priorities and these and most other documents referred to in this chapter can be found on the gov.uk website.
Government construction and estate management
Government must lead by example, including commissioning and delivery of its own construction projects and how it manages its estate. The government’s Construction 2025 strategy sets ambitious targets for cost and carbon reduction as well as reduced timelines for delivering projects. BIM is seen as crucial to achieving cost and time reductions and all government projects must achieve at least BIM Level 2 by 2016. The government is also keen to improve prompt payment to suppliers through project bank accounts, use collaborative procurement routes such as two-stage open book, and use integrated project insurance. And with most property costs occurring during the operating life of the asset, Government Soft Landings is a policy that ensures BIM data is transferred into computer aided facility management (CAFM) systems to maintain the integrity and benefits of the building information dataset for the whole property life cycle.
The Ministry of Justice has embraced BIM for all its new build and major refurbishment projects, and increasingly for minor works projects. A dedicated BIM library with 98 standard component products has been set up that enables us to build any court or prison. New IT has been installed that will allow us to measure savings across the whole portfolio and, importantly, during the whole property life cycle, including FM.
The Greening Government Commitments targets require departments to reduce their carbon, waste and water use year on year. The construction strategy wants the UK to lead the world in low carbon and construction exports, and so new projects should actively assess potential for incorporating renewables and other low carbon products.
Characteristics of a government project
Government projects can be complex. Outcomes required could save lives, improve educational results or reduce crime, and there could be many different beneficiaries of projects. These beneficiaries can also be complex. A prison benefits society at large by supporting the rule of law but the location of new prisons also needs the support of the local community through the planning system. Furthermore, the local community may benefit from the prison, as it provides employment.
Government projects need to comply with relevant government policy objectives and demonstrate how others can achieve these objectives. So the project might include, for example, economic objectives like encouraging SMEs (small and medium-sized enterprises) to tender for elements of the project.
Project organisation
Parliament grants ministers the right to commit resources for their specific policy area and so a minister’s role is to set the policy framework and priorities. It is the job of the civil service to deliver projects that meet these priorities. Both ministers and civil servants are accountable to the Public Accounts Committee (PAC) for how they spend money, including on projects.
For a project, the senior responsible officer (SRO) and the project director are key roles. The latter are responsible for the delivery of the project on time, to cost and of quality, and the SRO is accountable for the overall success of the project and ensuring that the benefits are delivered (lives saved, educational outcomes improved, crime reduced). Recent changes to civil service rules mean that SROs are now accountable directly to parliament.
Because of the complexity of government projects, it is essential to map out the governance that the project will need to navigate, as this could have a significant bearing on the overall schedule.
Getting approval
Getting consent to proceed with a government project requires a number of approvals. Projects must have a business case that complies with HM Treasury Green Book guidance, which requires five different cases. These are:
- 1 Strategic case for change: why do you need to do a project at all? What is the relative priority of the project for the organisation?
- 2 Economic case: does the project offer best value for the public purse? Which funding routes give the best NPV?
- 3 Financial case: is the project affordable within existing budgets?
- 4 Commercial case: is the proposed deal attractive to the market place? Can it be procured and is it commercially viable?
- 5 Management case: is the project achievable? Has the project team got the right skills and capacity to deliver it?
The project must be underpinned with an economic options appraisal that assesses capital and revenue costs throughout the life of the project, risk and qualitative and quantitative benefits. The business case needs to assess a number of options for meeting the requirements. In the case of a building project, this could include refurbishment, new build or minimal maintenance options. Different funding options will also need to be appraised, including both public sector and private sector funding and any hybrid options.
The preferred option will need to demonstrate that the project provides more benefits than other projects within the home department’s portfolio – or across other government departments if capital budgets are being negotiated as part of the spending review. The question as to why the taxpayer should invest in this project as opposed to not investing at all or investing in other projects will require an answer.
If the project is considered to be a major project, defined on capital value/whole-life value terms, then the project will need an external assurance review from the Major Projects Authority and HM Treasury approval to the investment. If you are new to government projects, you are recommended to read the Major Project Approval and Assurance Guidance, published on gov.uk.
Public procurement rules
Public sector projects are by law subject to European Union procurement regulations and there is an increasing tendency for unsuccessful bidders to mount a legal challenge to procurement decisions with the potential for delay and additional cost. So it is essential to understand the broad requirements of the regulations and ensure that you have access to competent advice from experts with recent experience of public sector procurement.
The main impact on your project will be time: the regulations are there to ensure that contracts are awarded fairly and transparently, and that all potential bidders are treated equally. This takes time and there are no short cuts. The project will need to advertise its intentions to go to competition and must publish the results in the Official Journal of the EU (OJEU). The Crown Commercial Service is the government’s agency that advises government departments about procurement and they publish considerable guidance on gov.uk
Almost all professional and constructor services are sourced via frameworks, which are competitively tendered in OJEU. That means that consultants and suppliers who want to work on government projects should ensure that they scan OJEU for notifications of forthcoming competitions.
Transparency and accountability
Government projects are funded from the public purse and overall responsibilities are described in HM Treasury’s Managing Public Money available on gov.uk. The National Audit Office (NAO) is independent of government. It audits specific projects, as well as broader topics such as the effectiveness of asset management across the government estate. Their reports are submitted to the PAC and are published online. The government has committed to making as much public sector data as possible freely available. There is a rich source of data on www.data.gov.uk/data. The Freedom of Information Act is another source of information about government activity.
Conclusion
Many aspects of delivering a government project are the same. If you are new to government work, ensure that you familiarise yourself with the guidance, do not take shortcuts on procurement, include decision-making milestones in your project plan and make sure that you have access to public sector expertise in your team. ◼
How to be an effective public sector client
The public and private sectors often regard each other as worlds apart. For many within the public sector, the private sector is seen as too focused on profit with little regard for the best interests of the public. Conversely, within the private sector there is often a view that the public sector is wasteful, with no concern for its need to make a fair profit in exchange for delivering services.
Both views are of course wrong but there are significant differences between the sectors, and the most effective public sector clients understand what these are, why they exist and how to balance the needs of each.
Above all else, private sector organisations must make a profit in order to survive. This imperative can sometimes cause them to fall into the trap of prioritising the bottom line to such an extent that good governance and due process is ignored, leading to the high-profile failures seen in the banking sector. It can also result in the delivery of poor quality services to customers. But the best private sector organisations do not make this mistake because they understand that long-term and sustainable success can only be achieved by maintaining effective governance, delivering value for money, building trust and providing high quality services to their clients rather than chasing short-term gain.
Public servants are accountable for every decision they take and are required to follow due process in their daily actions. However,
Perspective
by Ty Robinson
at times these processes can cause delays, raise costs and at their worst create perverse outcomes caused by rigid adherence to the process, with no scope for the application of judgment by experienced managers trying to achieve the best possible outcomes. Recognising this issue is straightforward, however, addressing it is challenging. Any departure from what is considered acceptable due process within the public sector will be frowned upon by the civil service and the various bodies that hold them to account, and can lead to public censure, loss of employment and, in extreme cases, legal action against those involved.
The challenge to the public servant then is to maintain an appropriate balance between satisfying the requirements of due process while achieving results that recognise the need for their private sector partners to return a fair and reasonable level of profit.
This can only be achieved with experience, constant effort, the full support of colleagues, senior managers and ministers with a clear and deliverable plan coupled with an effective communication strategy – all delivered by a fully resourced and excellent team.
None of this is a given and the root of many failed initiatives can be traced to gaps in one of more of these requirements.