Source · Select Committees · Public Accounts Committee
Recommendation 2
2
Accepted
Mandate Home Office to detail future due diligence processes protecting taxpayers' money on projects.
Recommendation
In its haste to establish large accommodation sites, the Home Office made unacceptable and avoidable mistakes, and failed to protect value for money. The Home Office asserts that its need to deal with a “national emergency” meant it had to take quick decisions, and so it pressed ahead with setting up expensive large asylum accommodation sites without an adequate understanding of what would be required. The Home Office’s estimates of the set-up costs for the large former military sites fell far short of reality. It estimated that it would cost £5 million to ready each of the sites at Wethersfield and Scampton. But costs spiralled to £49 million at Wethersfield, and has cost £27 million so far at Scampton. It also failed to maximise competition in awarding its contracts by simply amending current contracts or using frameworks. Furthermore, these two previous RAF bases will now accommodate significantly fewer people than the Home Office envisioned. Fewer people on sites means a higher per person cost. These errors may ultimately cost the taxpayer £46 million more than if the Home Office had simply retained the use of hotels instead. It is essential that departments ensure that taxpayers’ money is protected, even when required to work quickly. Recommendation 2: As part of its Treasury Minute response, the Home Office should set out what it will do differently in the future so it ensures it undertakes sufficient due diligence at the outset of projects and protects taxpayers’ money when working at pace.
Government Response Summary
The Home Office has restructured the programme to deliver smaller sites, improved technical construction expertise for cost estimation, brought forward due diligence, and improved engagement with local authorities, with accounting officer assessments and business cases now completed for each site.
Government Response
Accepted
HM Government
Accepted
The government agrees with the Committee’s recommendation. Recommendation implemented A raft of measures has been implemented to address weaknesses. The programme was recently restructured to deliver smaller sites, requiring lighter touch refurbishment and supporting the reframed strategic aim to deliver a flexible accommodation-estate that can respond with agility to changes in demand. Lessons have been learned regarding cost profiling and projections: the programme has improved technical construction expertise to ensure that a more accurate estimation of set up and delivery costs is better considered for future sites. Accounting officer advice including value for money assessments and business cases are completed for each site. Alongside significant work to lower operational costs, this will further assure the value the programme offers to the taxpayer. The Asylum Support, Resettlement and non-detained Accommodation Programme ASRA) has balanced the requirement to deliver accommodation at pace to meet changing demand and brought forward due diligence to enable decisions around viability and value for money to be taken at an earlier stage, reducing potential cost and commercial risk. It has also improved engagement with local authorities and partners, introducing this at an earlier stage. As a result of these measures, an independent review undertaken by the Infrastructure and Projects Authority found that successful delivery of the programme to time, cost and quality appears feasible.