Source · Select Committees · Public Accounts Committee
Recommendation 14
14
The IPA and NIC stated that programmes should provide a reasonable range of outcomes for...
Conclusion
The IPA and NIC stated that programmes should provide a reasonable range of outcomes for likely costs and schedule that reflects the level of uncertainty in a programme.23 The Comptroller and Auditor General has also recommended the use of 16 Q 82 17 Q 85 18 Q 3 19 Q 5 20 National Infrastructure Commission submission, page 2–3 21 Q 22 22 National Infrastructure Commission submission, page 2 23 Q 21; National Infrastructure Commission submission, page 2 Lessons from major projects and programmes 11 ranges.24 Ranges will necessarily be large at the early strategic outline business case stage, and as a programme goes forward, should narrow as more becomes known. The NIC said that its Rail Needs Assessment uses its latest best practice on using ranges for cost estimates. The IPA stated that as a programme goes towards the outline business case stage it expects that ranges will narrow down to plus or minus 25 to 30% and would like to see cost estimates with an accuracy of plus or minus 10% by the final business case stage.25 Skills and Leadership
Government Response
Acknowledged
HM Government
Acknowledged
4.1 The government agrees with the Committee’s recommendation. Target implementation date: April 2021 4.2 In January 2021, the IPA Chief Executive Officer (CEO) addressed permanent secretaries, requesting that they insist their teams are more realistic and evidence-driven in their approach to estimations of major project cost and schedule. The IPA will formally set out new requirements of departments, on a comply or explain basis, in Best Practices for Cost Estimating which will be published in March 2021. This will include a requirement to use ranges that are gradually narrowed as certainty emerges. The IPA will offer additional training to SROs on cost estimation later in 2021. 4.3 The IPA is working to develop a centralised data platform to aggregate and leverage past government project data to underpin, challenge and assure future project estimations of cost and schedule. This platform will be piloted across a number of asset classes from March 2021.