public-private partnerships: new vfm guidance
DESCRIPTION
Public-Private Partnerships: New VfM Guidance. Peter Conlong Finance & Central Services Department Analytical Services Division. Outline of Presentation. Need for new VfM guidance HMT guidance Scottish approach Questions?. Need For New Guidance. Revisions to HMT Green Book - PowerPoint PPT PresentationTRANSCRIPT
Public-Private Partnerships:New VfM Guidance
Peter Conlong
Finance & Central Services Department
Analytical Services Division
Outline of Presentation
Need for new VfM guidance HMT guidance Scottish approach Questions?
Need For New Guidance
Revisions to HMT Green Book Reports by NAO & Audit Scotland New Treasury VfM Assessment Guidance
To be applied in Scottish context
New HMT Green Book
“Unbundling” of discount rate Optimism bias Tax adjustments Emphasis on valuing benefits
Historical Problems With VfM Assessments
Focus solely on “the numbers”? Undertaken too late in process? Public procurement option not credible?
New Treasury VfM Guidance
PPP only one of a number of options Only use where appropriate & VfM Assess VfM early in process
New Appraisal Process in Scotland
Stage 1: Programme Level AssessmentStage 2: Project Level AssessmentStage 3: Procurement Level Assessment
Stage 1 - Programme Level
Stage 2 - Project Level
Undertaken at OBC stage Test specific project Qualitative & quantitative assessmentsIncreased reliance on judgement
HMT Quantitative Model
Simplified approach – reflects:point at which analysis takes placedesire that authorities be able to run the model
themselves
Use only at Stage 1 and Stage 2
Stage 3 - Procurement Level
Ongoing process from OBC to close Adequate competition? Risk-sharing deliverable? Confirm affordability Plus…
Final VfM Test
Unlike HMT, we are retaining final test of VfM against cost of public procurement
More detailed quantitative analysis Consider alongside qualitative assessment Provides clear audit trail
Summary
New guidance required 3-stage assessment process Quantitative and qualitative Retaining final VfM test
Any Questions?
The guidance is currently being finalised - we would be grateful for your views