Written evidence from the Infrastructure and Projects Authority (MMP 14)

Public Administration and Constitutional Affairs Committee

The Government’s Management of Major Projects inquiry

Introduction

1. The Infrastructure and Projects Authority (IPA) welcomes the opportunity to respond to the Committee’s inquiry, and thanks HM Treasury and Cabinet Office colleagues across the Government’s Functions for contributing to this submission.

2. Government often delivers its policy objectives through projects and programmes, and the Government’s portfolio is bold and ambitious in its breadth and scope. By nature, many Government projects and programmes sit at the higher-risk end of the spectrum.

3. The UK Government’s approach to the management of public projects is highly regarded internationally. Examples of initiatives that have been cited or adapted elsewhere include appraisal frameworks such as the Green Book[1]; the creation of a single portfolio of major projects; project leadership training programmes such as the Major Projects Leadership Academy; tools that help public and private organisations to initiate and deliver infrastructure projects such as the Project Initiation Routemap; and the UK’s approach to independent project assurance.

4. The IPA’s dedicated international team provides training and advice to major project practitioners around the world. The IPA is also closely engaged with organisations such as the Global Infrastructure Initiative and the OECD to learn from and share good practice internationally.

5. The institutional framework for project delivery in Government has undergone significant change in recent years (see Annex A) and independent voices such as the National Audit Office and the Institute for Government have recognised the progress made in improving the project system. Since 2015, civil service capacity has been strengthened through the establishment of cross-Government ‘Functions’. These bring together people, processes, and specialist expertise in areas such as project delivery, commercial and digital, deploying the right people and skills in the right place at the right time to deliver Government’s objectives. 

6. The IPA leads the Government’s project delivery function, reporting to both Cabinet Office and HM Treasury. Our teams include experts in infrastructure, project delivery and project finance. We work with Government Departments and industry, on an ongoing basis, to improve the project delivery system and to help Departments work as effectively as possible within it. We support the successful delivery of initiatives ranging from railways, schools and housing to defence, IT, tax and welfare reforms, and including major transformation programmes to modernise public services. Ultimately, we strive to build the best-performing project system of any country in the world through setting up projects for success; creating market confidence; building delivery capability and measuring and improving performance.

7. Major projects are often managed as part of programmes and portfolios:
1. A programme is an umbrella for a particular set of projects, seeking to deliver outcomes and benefits related to a particular set of strategic objectives.
2. A portfolio is an overarching governance structure to allow selection, prioritisation and control across several programmes, projects and other work packages.

Portfolio, programme and project management are collectively referred to in Government as project delivery. 

8. Successful project delivery means delivering agreed objectives within the agreed parameters of time, quality and cost, and within reasonable levels of tolerance and uncertainty. This requires active management throughout, from clearly defining objectives at the outset of the initiative, to transitioning to ‘business as usual’ at the end.

9. Project delivery in Government comes with particular challenges, including supporting objective decision-making within a political environment and responding appropriately and constructively to public interest and scrutiny. Setting up projects to succeed takes time – often curtailed by the electoral and Parliamentary cycles. This may lead to over-optimistic early commitments of what is achievable, and over-programming of work within Departments. The IPA aspires to minimise these issues through scrutinising potential projects at an earlier stage, prior to announcement; and by helping Departments to look across their portfolios and prioritise within them. To do this effectively, it is important for the civil service to have the right capacity and capability and the confidence, backed by evidence, to ‘speak truth to power’.

10. In this context, the IPA aims to help Government project delivery to ‘shift up a gear’. Our aspiration is for every project to deliver excellence, meet its business case commitments and effectively implement Government policy priorities. The IPA is working with colleagues across Government to meet this challenge, focusing on setting up projects for success; taking a portfolio view; developing project leadership; and measuring and improving performance over time. As part of this, it is critical to bridge the ‘valley of death’[2] between policy and delivery by ensuring that the practicalities of delivery are considered as early as possible in the policymaking process.

11. This evidence submission provides an overview of the project delivery system within Government, and highlights ongoing work to strengthen project delivery through improving processes, practices and the quality of project leadership.  

Project and programme delivery in Government: roles and responsibilities

Government Departments and the centre of Government

12. Departments are responsible for project delivery in Government, either directly or through their agencies, arms-length bodies (ALBs) or wider partnership vehicles.

13. Each Department has an Accounting Officer (AO) who is accountable to Parliament for their handling of public funds. The AO will typically designate a Senior Responsible Officer / Senior Responsible Owner (SRO) for significant projects and programmes. While ultimate Departmental accountability remains with the AO, the SRO leads the project or programme and can be held accountable by the AO, and by Parliament, on its implementation. Since the publication of updated ‘Osmotherly Rules’ guidance[3] in 2014, Departments have issued formal letters of appointment for SROs of major projects setting out the parameters of their roles, which are countersigned by the Chief Executive of the IPA and published online.

14. In the first instance, the relevant project or programme team within a Department is responsible for managing delivery, including identifying and mitigating risks. Typically, a programme or project manager will be appointed to drive the day-to-day management of the initiative, with accountability to the SRO. The wider Department oversees the project team’s work, as part of managing its wider portfolio of projects and programmes.
     
15. Departments can take a proportionate approach to establishing appropriate governance for a project or programme, and applying safeguards and checks proportionate to its scale and levels of risk. However, Departments must ensure that they comply with two key documents:

1. The Green Book[4] sets out how Departments should appraise and evaluate proposed policies, portfolios, programmes and projects using the ‘five case’ model of business case development, to ensure that recommendations and decisions are robust and well-evidenced. It also forms the foundation of HM Treasury’s processes for approving Government spending, and for Government’s periodic strategic Spending Reviews.

2. Managing Public Money[5] sets out how Departments must handle public funds with probity, in the public interest and in a way that respects the role of Parliament.

16. HM Treasury and the Cabinet Office have a range of mechanisms to maintain oversight of project and programme delivery across Government, grounded in the principles set out in the Green Book and Managing Public Money. Notably, HM Treasury can approve or veto Government expenditure on major projects, and monitors spending to ensure that projects represent value for money. The Cabinet Office administers additional spending control processes for any commercial transactions worth over £10m.

Government Functions

17. The centre of Government also leads the development of Government’s specialist Functions, which have been established as trusted sources of specialist expertise, advice and challenge across Government. Though varying in scope and maturity, the Functions set cross-Government strategies and standards; give expert advice to Departments; develop specialist capability in the Civil Service; drive continuous improvement; and, where required, develop and deliver services directly.

18. For example:
1. As the home of the Project Delivery Function, the IPA provides a range of hands-on support to Departments at all stages of project initiation and delivery. This includes providing expert commercial advice on complex infrastructure projects, particularly those requiring public-private collaboration such as the Thames Tideway Tunnel, Mersey Bridge or rural broadband; engaging experts from a range of backgrounds to help Departments work through issues of deliverability and risk; and at times embedding capacity directly within project teams.

2. The Government Commercial Function brings together the 4,000 civil servants procuring, or supporting the procurement of, these goods and services for government. An example of its impact was the coordination of a cross-governmental response to the 2018 liquidation of Carillion, which held c.420 contracts across central and local government. This work minimised service disruption and supported the majority of Carillion’s staff into secure, ongoing employment.
    
3. The Government’s Digital, Data and Technology Function, led by the Government Digital Service (GDS), helps Departments to build and run government services that are digital by default and focused on the needs of citizens. By using GDS’ Digital Service Assessments and spend controls, digital projects and programmes must demonstrate that standards are being met in areas including value for money, transparency and user centred design, and that risk assessments have been put in place. GDS also delivers several programmes directly, including the single GOV.UK website and specific products such as GOV.UK Pay and GOV.UK Notify; and the GovTech Catalyst which funds private sector innovators to solve public sector challenges.

19. The lead bodies for many of the Functions also provide objective assurance on projects and programmes. For example, the work of the Government Internal Audit Agency covers 75% of Government activity, while the IPA is responsible for a range of assurance reviews of Government’s major projects and programmes (see below).

20. Through this work, Government is increasingly able to establish and deploy multidisciplinary teams to address particular needs. For example, the Functional Support Team (FST) in the Cabinet Office provides insight and analysis for the highest priority EU Exit projects, and uses this to help Departments by coordinating solutions to common challenges. This work draws heavily on the IPA, the Government Commercial Service and the Government Digital Service, as well as the Government HR Function. For example, the IPA has carried out a series of assurance exercises on the highest priority EU Exit projects across different exit scenarios, which the FST has used to help resolve barriers to progress and ensure a coordinated approach across Government.

21. More information on the role of the Functions is provided in Annex B.

The Government Major Projects Portfolio (GMPP)

22. The Major Projects Authority (later part of the IPA) was established by the previous Prime Minister in 2011 ‘to help us get firmer control of our Major Projects both at the individual and the Portfolio level’.[6] Central to this was the establishment of the Government Major Projects Portfolio (GMPP) to ensure robust oversight of Government’s most complex and strategically significant projects and programmes.

23. The IPA publishes an Annual Report and underlying data on the GMPP. In 2017/18, the GMPP included 133 projects and programmes, across 16 Departments and agencies, with a total in-year budget of £27bn and a whole-life cost of £423bn. Over the course of the year 29 projects left the GMPP – with 26 having been successfully delivered – and 18 joined. The portfolio is one third smaller than at its peak in 2014, reflecting projects ‘graduating’ from the programme and the progress of the Government spending cycle.[7]

24. Projects and programmes included in the GMPP are typically those where approval is required from HM Treasury, either because the budget exceeds a Department’s delegated authority level or because the project is novel, contentious, high risk or requires primary legislation. Projects can also be placed on the GMPP by agreement between the IPA, HM Treasury and the relevant Department. These criteria mean that many GMPP projects are those with very large budgets, but this is not always the case – for example, the smallest project identified in the 2018 annual report has a whole life cost of only £7.5m. Departments also undertake many projects of significant scale outside the GMPP process.

25. GMPP projects and programmes are divided into four categories: transformation and service delivery; ICT; infrastructure and construction; and military capability.

Figure 1: examples of projects and programmes in the four GMPP categories

Major projects: ‘life cycle’, approvals and assurance

26. Major projects and programmes in Government have an established ‘life cycle’ from policy development, through initiation and delivery, to closure and transition to business as usual. This is set out in the Project Delivery Standard developed by the IPA for use across Government[8]. Figure 2 below summarises this ‘life cycle’ for major projects. 

Figure 2: project stages, assurance reviews and HM Treasury business case approvals[9]

27. The life cycle of a major programme looks slightly different from that of a major project, given the greater breadth and (often) longer timescales of programmes (see Annex C).

28. Departments are responsible for policy development, through which the need for projects and programmes arises – either as an intervention to improve a particular set of outcomes, or as a response to new or changing circumstances. Most Government policies are delivered through some form of project or programme.

29. Once a major project is conceived, there are several gates / decision points where Departments must produce particular plans, and seek formal approvals or assurance from the centre of Government, in order to progress. At the outset of a major project, Departments must agree a plan with HM Treasury and the IPA for how these assurance and approval tools will be deployed and sequenced.

Business case development and assessment

30. When a project is proposed, Departments must produce a business case to articulate the need for the project, options for delivering it and the risks that it may involve. Projects must have a business case in order to be included on the GMPP.

31. There are usually three stages of business case development (Strategic Outline, Outline and Full), with greater detail at each stage, but this can vary. Business cases must comply with the HM Treasury Green Book’s ‘Five Case’ model, and there is guidance[10] to support Departments in this.

32. To secure approval for a project, HM Treasury must be assured that the business case meets a number of criteria:
1. there is a clear need for the initiative or ‘case for change’, and it fits with the Department’s and the Government’s overall portfolio and priorities (strategic case);
2. a range of realistic options have been appraised to identify the proposal that delivers best public value to society, including wider social and environmental effects (economic case);
3. the preferred option will result in a viable procurement and a well-structured deal between the public sector and its service providers (commercial case);
4. the preferred option is affordable and can viably be funded (financial case); and
5. there are robust arrangements for the delivery, monitoring and evaluation of the scheme and for how this will inform future strategic planning (management case).

33. HM Treasury Spending Teams often draw on the expertise of the Government Functions, including the IPA, in making their formal assessments of business cases. More broadly, the IPA is working closely with HM Treasury ahead of the next Spending Review to ensure that deliverability is considered early in the process.

IPA assurance reviews

34. Each year, the IPA undertakes over 200 independent assurance reviews to examine the delivery of GMPP projects. There are a number of types of review, used in different circumstances. Independent assurance reviews are an essential part of successful project delivery and provide support and constructive challenge to SROs, as well as informing formal approval and decision points. Through this work, the IPA helps Departments to consider the critical aspects required for successful initiation and delivery of projects; to analyse alternative options and whether they will deliver the required outcomes; and to avoid the reputational risk of undeliverable commitments being made.

35. Very early in the process, new policy or business change initiatives likely to lead to a major project should undergo a Project Validation or ‘starting gate’ Review, focused on setting the project up for success. The process includes a workshop with policy team members and key stakeholders and a meeting with the SRO, after which a report is produced rapidly and agreed with the Department.
36. During the development of the business case and the delivery of the project, the IPA will undertake Gateway Reviews at key decision points. In preparation for this, a dedicated Review team will study project documentation, including business cases and supporting material; examine any internal assurance activity already undertaken; and consider the possible interdependencies with other work. The team then runs confidential interviews with project staff, stakeholders and suppliers, meeting daily with the SRO throughout, and produces a report to be agreed by the Department within a week of completion.

37. Further Project Assurance Reviews are run as needed throughout the life cycle of the project to ensure that there is adequate scrutiny at other key points in the process.

38. GMPP SROs must also submit quarterly returns to the IPA on the performance, cost, duration and benefits of their project, from which the IPA assesses the extent to which projects are delivering against the commitments set out in their business cases.

Gates / decision points

39. Depending on the size and complexity of a project, a Treasury Assurance Panel (TAP) or Major Projects Review Group (MPRG) will be convened to scrutinise its progress at the gates / decision points highlighted in Figure 1 above.

40. Established in 2007, the MPRG acts as the highest level of scrutiny to major Government projects and is co-chaired by the Chief Executive of the Civil Service and the HM Treasury Director General for Public Spending. Examples of projects recently examined by the MPRG include HS2, Universal Credit and Digital Services at the Border.

41. Both the MPRG and the smaller-scale TAP are underpinned by expert input from the IPA (including the outputs from the assurance reviews detailed above) and HM Treasury, who can also draw on wider expertise from across the Government Functions as appropriate. The Treasury approvals process[11] sets out how this works in more detail.

Ministerial decision-making

42. All of these processes help the Civil Service to ensure that a robust evidence base, options and analysis are in place. It is the duty of officials to use this to inform, advise and challenge Ministers in their decision-making – ideally before announcements are made or resources allocated. Ministerial debate, consideration and signoff is likely to be particularly important in scenarios where there are competing priorities, a substantial change of direction is proposed or a major spending commitment is being considered.

Leaving the GMPP

43. In 2016, the IPA introduced a standard process for managing the exit of projects from the GMPP, with clear criteria which inform case-by-case discussions with Departments. To leave the GMPP, the project should have achieved its objectives; have closed or be about to close; and have completed some form of exit review. Only in exceptional cases can a project leave the GMPP if its IPA rating of delivery confidence is red or amber-red. The NAO[12] highlights this as a key reform to help ensure that the anticipated benefits of projects are delivered and that Government learns lessons from completed projects. The IPA is committed to continuing to drive improvement in this area, addressing the NAO’s conclusion that while ‘recent improvements are welcome’, there remains a need for the IPA ‘to develop its oversight at exit and for departments to monitor and evaluate projects and their outcomes more consistently, so that performance improves and maximum value is derived from projects’.

Project finance and commercial models

Project finance

44. There are a number of models open to Government in order to finance projects and deliver them, often working with the private sector.

45. Major projects, particularly infrastructure projects, typically require large up-front investment (‘financing’). The costs of this, including ongoing maintenance and operational costs, are then repaid by users or taxpayers over a period of time (‘funding’).

46. Finance can be provided by the public or the private sector, or a combination of both, through a variety of models. Whether public or private, financing comes at a price, as whoever provides the financing for a project takes on risk. If, for example, a project is closed down before completion, the financier will lose any money already spent.

47. The allocation of such risk is one of the factors in whether a Government project should be publicly or privately financed. The Green Book sets out approaches for considering the most suitable option. Value for money is of primary importance and the Government applies a strict scrutiny process to projects, with the aim of ensuring that a decision to use private finance is only made where it demonstrably provides value for money when compared to conventionally procured and government-financed alternatives. The IPA has a wealth of experience in funding and finance models, and advises Departments and HM Treasury as they consider which models suit particular projects.

48. The government has considered its position on the Private Finance Initiative and its successor PF2, in light of experience since 2012, and found the model to be inflexible and overly complex. At the 2018 Budget, the Chancellor announced the Government’s decision to retire the PF2 model.[13] 

Commercial models of delivery

49. There can be significant potential advantages to private sector delivery of Government projects and services, including securing economies of scale; sharing risks; deploying a broader and deeper array of skills, expertise and knowledge; and encouraging creativity and innovation through competition. However, as with financing, different projects will require different solutions. All contractual decisions must be based on a sound business case and comply with relevant guidance.

50. In developing the commercial case for a project, Departments should carry out an options analysis which assesses the cost and quality advantages of purchasing services compared with delivering them in-house. This ensures that public bodies only purchase services from the private and third sectors where there is evidence that this will deliver the required quality of service at better value for money for the taxpayer.

51. Additionally, Cabinet Office and HM Treasury are developing a ‘playbook’ for contracting authorities to use alongside the Treasury Green and Orange Books, to ensure that existing Government guidance is being followed and procurement decisions are made after full and informed consideration of the options.

52. The Government Commercial Function helps Departments to ensure that they have the right commercial skills and resources in place to develop and implement effective approaches. The Crown Commercial Service and specialist central commercial teams develop category strategy and commercial strategy, undertake procurements, manage contracts, analyse markets and maintain relationships with key suppliers, in order to support Departments to get the best from their public purchasing and contracting spend.

53. For infrastructure projects, Transforming Infrastructure Performance[14] – Government's long-term plan to improve the delivery and performance of infrastructure – includes a range of activity to improve procurement. Through this work, the IPA has collaborated with industry to launch and test a smarter procurement model, ‘Project 13’[15].

54. There are a number of factors which Departments should take into account when considering the right procurement and contracting strategy for a major project, including the desired outcomes from the project; whether capable commercial suppliers are available and whether they will consider it worth their while to bid; and learning from previous similar exercises. To design any competitive approach, the Department will need to consider the trade-offs between time, quality and cost: for example, if a project is aiming to address an urgent safety concern, time may be a greater priority than cost; and ‘whole life’ cost should be considered as well as short-term contract value.

55. The need to manage risk appropriately is also a key factor, with high-risk or novel projects more likely to need to depart from a traditional winner-takes-all competitive process. For example, in delivering the Thames Tideway programme, operational risk was spread across a number of tunnelling contracts with different contractors.

56. Frameworks can also be used to strike a balance between competition and flexibility. For example, the Crown Commercial Service is developing a construction framework,[16] establishing an approved ‘core’ group of contractors who have demonstrated that they can meet Government’s policy requirements and project needs and drive whole-life value. Individual call-off contracts can then be awarded directly or made subject to further competition depending on requirements.

57. Cabinet Office and HM Treasury are currently developing new strategies which will allow Government to better assess the financial stability of suppliers and markets; to balance risk more appropriately between Government and its suppliers; and to ensure that where possible, markets remain contestable for suppliers of all sizes.

58. Government’s aspiration is that 33% of central government procurement spend with private businesses should go to SMEs by 2022. We have introduced new measures to level the playing field for SMEs and help them operate within public supply chains.

Improving the Government’s systems and processes for project delivery

59. International comparisons suggest that the UK’s systems and processes for delivering projects and programmes are relatively robust and effective. Taking infrastructure as an example, a major G20 report has concluded that ‘The United Kingdom broadly performs above average across the infrastructure policy and delivery domains’ and that the UK has ‘strong underlying governance and regulatory frameworks’.[17]

60. However, there remains room for improvement, and the IPA, HM Treasury and Departments are also undertaking a broad and ongoing programme of work to improve Government’s systems and processes for project delivery.

Informing infrastructure policy development 

61. In 2015, the Government established the National Infrastructure Commission (NIC). Chaired by Sir John Armitt, the NIC is an executive agency of HM Treasury but operates independently, providing expert advice and challenge to Government. Each Parliament, the NIC will undertake a National Infrastructure Assessment to provide recommendations on the country’s long-term infrastructure strategy, and will hold the Government to account for its responsiveness to this. The first such Assessment was published in July 2018[18]. The Assessment, and Government’s response to it, will shape the body of infrastructure projects and programmes which the Government will promote, invest in and deliver in future years. The NIC and the IPA play distinct but complementary roles in the policy / delivery cycle, with the NIC’s recommendations informing Departmental decisions, and the IPA supporting and assuring the implementation of these.

62. The IPA has also developed Transforming Infrastructure Performance[19], the Government’s long-term plan to improve the delivery and performance of infrastructure projects. The plan includes actions around four themes: benchmarking, alignment and integration, procurement and smarter infrastructure.

63. The IPA also publishes a National Infrastructure and Construction Pipeline[20] each year, which provides a forward look of public and private investment in different types of infrastructure. This supports both public and private sector organisations in aligning and prioritising policy development and investment decisions.

Successful business case development

64. Green Book refresh and training: HM Treasury and the Welsh Government’s ‘Better Business Cases Network’ has trained over 6000 civil servants since 2013 to help them understand the Green Book guidance better and apply it effectively. HM Treasury is developing plans to roll the scheme out to civil servants across the UK. Meanwhile, HM Treasury has also refreshed the Green Book and associated business case guidance. Amongst other improvements, the updated guidance provides more comprehensive tools to assess the potential regional impacts of proposals; and places greater emphasis on building monitoring into projects throughout their lifecycle.

65. Getting cost and time assumptions right for infrastructure projects: as part of Transforming Infrastructure Performance, the IPA is developing a benchmarking approach to allow Government and others to evaluate the cost, schedule, benefits and performance of a project against comparator projects. This work has begun with tunnelling, where the IPA has brought together a range of public and private sector organisations to share data. This will help to prevent project failure arising from unrealistic assumptions and estimates, and help ensure that UK projects are globally competitive and reflect best practice from elsewhere.

Project initiation

66. Accounting Officer assessments: in 2016 the Government agreed that Departmental AOs should formally assess the regularity, propriety, value for money and feasibility of projects or programmes which form part of the GMPP. The resulting assessment should be updated if there are substantial changes in a project’s costs, benefits, timescales or levels of risk.[21] A number of AO assessments have been completed or are emerging. The IPA is working with HM Treasury to support AOs in assessing feasibility and to integrate these assessments more closely into the major project life cycle.

67. Supporting projects and programmes at initiation stage: in 2016, the IPA created an Early Development Pool (EDP) to provide projects and programmes with effective and tailored support at initiation stage. The EDP acts as a portfolio of initiatives which typically graduate on to the GMPP once sufficiently mature. Over 50 projects were part of the EDP in the IPA Annual Report snapshot period of September 2017.

The IPA is continuing to expand this area of activity in order to address the most common causes of project failure – such as a lack of clear objectives, insufficient resources, and over-ambitious cost and schedule – at the earliest possible stage. We are keen to do more to reduce the risk of undeliverable commitments being made by Government.
 

68. Project initiation routemap for infrastructure projects: working with major public and private infrastructure providers, the Institution of Civil Engineers and leading academic experts, the IPA has developed a set of tools to support improved infrastructure delivery. This has been used with several high profile organisations (including Sellafield, Heathrow and the House of Commons) and will soon be piloted internationally.

Performance management and transparency

69. Benefits realisation and tracking: The IPA and HM Treasury have sought to raise awareness of benefits realisation across Government. Though making clear that there is more to do, the NAO acknowledges that there has been good progress in recent years, noting that ‘In 2016, the Committee concluded that improving the delivery of projects’ benefits was a priority…. Since 2015-16 Departments report both expected monetised and qualitative benefits on a quarterly basis while projects are on the Portfolio. Prior to this only total financial benefits were reported. In addition, since 2015-16, [the IPA] has also requested more detail on the nature of monetised benefits to allow distinction between cash savings, non-cash savings and wider economic benefits, allowing a more granular analysis of benefits data. It uses these data to provide feedback to and engage with departments.’[22]

70. The IPA has also supported Departments to improve their own internal monitoring and delivery of benefits[23]. The focus of the IPA’s guidance on properly defining, measuring and reporting different types of benefits is particularly important for projects and programmes – such as those in the service transformation field – which have fewer obvious benchmarks to help evaluate their performance.

71. Better engagement with Departments: The IPA is working on a Department-by-Department basis to ensure a common, up-to-date understanding of project and programme performance and risks between Departments and the centre of Government.
     
72. Annual report: The IPA’s Annual Report[24] on the GMPP has been enhanced over time; the most recent edition included RAG ratings for all GMPP projects and programmes; a snapshot of the IPA’s delivery confidence assessments for all projects and programmes as of the last quarter; and a breakdown of initiatives which left the GMPP in-year.

Portfolio approach

73. Building on the success of the GMPP in allowing Government to look across its biggest and most complex projects, the IPA is promoting the benefits of a greater focus on managing projects and programmes as part of a portfolio – across a Department or across Government – in supporting and informing the right people to make the right decisions at the right time. HMRC’s portfolio management office provides a strong example of this approach in action, taking a focused and decisive approach to prioritising the Departments portfolio of projects and programmes, given the demands of preparing for EU Exit. This is another area of activity which the IPA is working to expand over the coming months and years.

Improving civil service capacity, capability and leadership for successful project delivery

74. Robust systems and processes are of limited value without skilled people. The IPA is continuing to grow the Government’s capacity and capability to lead and manage successful projects, programmes and portfolios, and to develop the next generation of project delivery leaders and commercial professionals, through a broad and ambitious programme of work.

75. In line with the Civil Service Workforce Plan[25], a key aim is to increase permeability between the public and private sectors, while maintaining propriety.

76. The IPA is also working with the Economic and Social Research Council and a range of universities and academics on ‘Project X’, which promotes and supports a wide range of research projects with real-world benefits for project delivery[26]. This currently includes a specific focus on sharing insights from transformation programmes, which can be some of the most complex to deliver and are often unique in their scope.

Defining and building the project delivery function and profession across Departments

77. Since 2014, the Major Projects Authority and subsequently the IPA has focused on establishing a clear and defined Project Delivery Profession, to enable a centrally led and coordinated Function. This has involved creating a common understanding across Government of the scope of project delivery and the skills needed by a project professional, and formalising this across Departments, including through an interdepartmental ‘Heads of Profession’ network and Projects Council. Over the past year, dedicated Project Delivery talent governance has been established in Departments with a focus on for Senior Civil Service (SCS) grades. Professional networks and communities of practice are increasingly flourishing, bringing SROs and project managers together to share lessons on common issues.
     
78. The IPA has worked closely with Departments, project delivery professionals and subject matter experts to lead the development of a ‘Functional Standard’ for project delivery in Government. This is the first such standard to be developed for a Government Function, and aims to ensure that officials at all levels apply a consistent understanding of conditions for successful delivery and of core project principles and methodologies. Departments are also seeking to embed the Standard in the work of their ALBs and agencies. The core principles underpinning the Standard are appended at Annex D.

79. Recognising the achievements of project delivery within Government through initiatives such as the Civil Service Awards has also been an important part of developing Government’s project delivery culture. Some case studies drawn from entries to the project delivery category of the 2018 Awards are appended at Annex E.

Developing the next generation of project delivery leaders

80. The IPA has worked with Departments to embed a cross-Government Project Delivery Capability Framework. Launched in May 2017, the Framework defines the job roles, core skills and development needs for project professionals across Government. It complements, rather than supersedes, relevant professional accreditations and affiliations. All Departments have signed up to use the Framework, and to date there have been over 30,000 downloads of the Framework since its launch.

81. As well as supporting individuals to manage their careers and improving the Government’s learning and development offer, the Framework is being used to support cross-Government recruitment campaigns. It has attracted considerable interest outside Government and is viewed as an exemplar across the Government Functions.

82. The Framework outlines the range of learning and development available to project delivery professionals across different grades. The key elements of this curriculum are highlighted in Figure 3 below.

Figure 3: key elements of the project delivery curriculum

83. The Major Project Leadership Academy (MPLA) is the Government’s flagship programme for project leaders. Aimed at SCS officials from Departments and ALBs who are delivering major projects and programmes, the MPLA comprises six weeks of intensive training spread over 18 months. It is mandatory for all SROs of GMPP projects and programmes to undertake the MPLA, and to date, more than 600 senior leaders have enrolled on the scheme. The MPLA is recognised as a world-leading programme, with other Governments eager to learn from the UK.

84. We have also designed and rolled out the shorter Orchestrating Major Projects (OMP) programme tailored for Directors General and Permanent Secretaries, so that they can create the right environment for successful project delivery. Both MPLA and OMP are delivered at the Said Business School at the University of Oxford.

85. Specific training is also available through the Leading as an SRO course, for SCS officials to improve their understanding of their roles and responsibilities as SROs and their ability to lead complex projects outside the GMPP. The IPA has also established a specific EU Exit Programme for senior officials leading EU Exit projects, many of whom have no prior project delivery experience.

86. The IPA is also working with Departments to strengthen learning opportunities for the many project professionals across Government below SCS level. The IPA delivers the Project Leadership Programme (PLP) for officials at just below SCS grades, who deliver GMPP workstreams or projects below GMPP thresholds. The PLP is taught at Cranfield University and has enrolled 1000 leaders to date.

87. Working with Departments, the IPA has developed a federated Projects Academy that improves coordination and collaboration on learning and development between six Departments and brokers opportunities for project professionals across Government.
     
88. The IPA has also set up dedicated strands of the Civil Service Fast Stream and the Fast Track Apprentices programme for aspiring project delivery professionals. There are currently more than 300 project delivery fast streamers and apprentices in Government. The Project Delivery Fast Stream has grown in popularity since it launched in 2016, and now receives the third highest number of applications of all 15 Fast Stream strands.

Recruitment and retention

89. The IPA has developed the Government Online Skills Tool, which allows project professionals to assess their project delivery skills against their current role and potential future roles to which they aspire, and to plan their learning and development in line with the capability framework. The tool is able to highlight capability strengths and gaps at a team, project/programme, department and Government-wide level. There are currently over 5,000 live users of the tool across 11 Government Departments, and planning is underway to roll out the tool to the Government’s Commercial and Counter-Fraud Functions.

90. The IPA supports Departments in their recruitment for project delivery roles. This includes undertaking labour market research; sharing pay recommendations; providing advice and materials to assist with scoping roles, candidate attraction and selection; and supporting candidate sharing and brokering across Departments. The current focus for the IPA’s work in this area has been on supporting EU Exit projects.

91. The IPA also runs cross-government recruitment campaigns directly to meet resource demand across Government in an efficient way, using a single job description, agreed selection methodology and common pay offer. In 2017, the IPA ran four campaigns for project managers and one for project planners. To date, the IPA’s direct recruitment work has resulted in over 225 appointments across more than ten Departments. In line with the Cabinet Office’s aspirations, over 70% of those appointed through this process have been external applicants who can bring fresh skills and talent to the Civil Service. We are working closely with departments to improve central forecasting and capture demands to plan resourcing activity for future years.

92. The IPA additionally offers a senior brokering service for SCS project delivery professionals. This supports vacancy holders across government to fill priority SCS vacancies at pace, and project delivery professionals to assess the SCS roles on offer. Over the past year, the IPA have supported several Departments to resource priority SCS roles, including BEIS, Cabinet Office, Defra, HMRC, Home Office and MoD.

93. Diversity and inclusion are key priorities within the Project Delivery Profession, and central to all of the IPA’s activity. We are working with Departments to strengthen the diversity of the project delivery talent pipeline, and monitoring diversity at all stages of our centrally coordinated recruitment campaigns. To support an inclusive culture, we are piloting a ‘Culture Enquiry’, developed with Civil Service HR colleagues, across the Project Delivery Profession, and have also developed a Diversity and Inclusion Action Plan to improve visibility and engagement of staff from under-represented groups.

November 2018

Annex A: evolution of the Government’s institutional framework for major projects

The Government’s institutional framework for major projects has undergone significant change and improvement in recent years:

●      In 2000, the Office of Government Commerce (OGC) was established as part of HM Treasury. The OGC operated through the Government Procurement Service, an executive agency now known as the Crown Commercial Service. The purpose of the OGC was to support the procurement and acquisition process of public sector organisations in the UK through policy and process guidance and the negotiation of overarching service and provision frameworks. This was intended to improve value for money to the taxpayer, optimising the level of taxpayers equity directed towards the delivery of services. The OGC supported initiatives to encourage better supplier relations, sustainable procurement, the benefits of utilising smaller suppliers and the potential of eProcurement, and helped shape approaches to procurement in the EU and across the G6. It was moved into the Efficiency and Reform Group of the Cabinet Office in 2010, before being closed in 2011.

●      Also in 2000, Partnerships UK was established to succeed the Treasury Taskforce and set up a permanent centre of excellence, moving away from the old model of ‘revolving-door’ secondments that offered no retention of expertise or knowledge. A dedicated and permanent centre of expertise available to the public sector to provide senior strategic support to public bodies, sharing responsibility for delivering successful partnership solutions, from the appointment and management of advisers to the scoping, development, troubleshooting and negotiation of value for money projects.

●      In 2010, Partnerships UK became part of a new body, Infrastructure UK. This was a division of HM Treasury that advised government on the long-term infrastructure needs of the UK; published a forward pipeline of UK infrastructure investment; and provided commercial expertise to support major projects and programmes involving public sector capital, such as Crossrail. It also led on private finance policy across government; and negotiated infrastructure guarantees, under which up to £40 billion is available to support investment in UK infrastructure projects.

●      In 2011, the Major Projects Authority was established as a partnership between Cabinet Office and HM Treasury. The Authority had a Prime Ministerial mandate to work with Departments and provide independent assurance on major projects, and to support colleagues across departments to improve their project delivery capability and practices. The establishment of the Government Major Projects Portfolio (GMPP) allowed government to understand the scope and scale of our most important projects, as a portfolio, for the first time.

●      In 2016, Infrastructure UK and the Major Projects Authority were merged to form the Infrastructure and Projects Authority (IPA). The IPA reports jointly to HM Treasury and the Cabinet Office, providing the organisation with significant reach across Government.

Annex B: background on the Government’s Functions

There are 14 Government Functions. Working in a range of ways, they set cross-Government strategies and standards; give expert advice to Departments; develop specialist capability in the Civil Service; drive continuous improvement and where required develop and deliver services directly.
 

●       The Analysis Function provides best practice research and analysis services within government. It is a collaboration between several analytical professions, who collectively support all civil servants, including the most senior in government to make informed decisions.
 

●       The Commercial Function brings together the 4,000 civil servants procuring, or supporting the procurement of, goods and services for government, achieving significant savings for the public purse.

●       The Communications Function is a visible, trusted, strategic partner across government with expertise in all communication disciplines. The Function designs, plans and delivers world-class media work, public-facing campaigns and stakeholder and internal communications.

●       The Counter-Fraud Function brings government’s fraud specialists together, to help ensure they have the capability and tools to work with public bodies to find and fight fraud and economic crime. Those working to fight fraud have an impact of over £9bn on public expenditure every year, and deliver over 5,500 prosecutions.

●       The Debt Function works in partnership with Government Departments to ensure efficient and effective management of the £22.5bn of debt owed to central government. It also works closely with the debt advice sector through the Fairness Group to help improve fairness to all citizens. The Function includes c.8000 officials.

●       The Digital, Data & Technology Function provides best practice guidance and advice for consistent, coherent, high quality services. The Function sets and enforces standards for digital services; builds and supports common platforms, services, components and tools; and helps government choose the right technology.

●       The Finance Function works across government to make sure public money is spent efficiently and effectively. The Function includes over 10,000 people across Departments, in a wide range of roles from strategic business partners to technical accountants. It plays a critical role in the management of almost £800 billion of annual Government expenditure.

●       The Grants Management Function supports colleagues in departments and ALBs to improve efficiency and increase transparency of approximately £139bn of Government grant spend each year. Through the Centre of Excellence, it provides access to high-quality guidance, products and training to help grant makers carry out their role effectively. This improves standards, provides consistency for grant recipients and delivers improved value for the taxpayer.

●       The HR Function, Civil Service Human Resources, is made up of over 3,500 colleagues across government. HR teams provide a source of expertise on people, policies, processes and recruitment campaigns, supporting the Government workforce and helping Departments to build a modern, effective Civil Service. Centrally, the HR function manages expert services and offers guidance in areas including pay and reward; talent management; employment policies; strategic workforce planning; and learning and development.
 

●       The Internal Audit Function, which includes the work of the Government Internal Audit Agency, helps Accounting Officers, their seniors and audit committees know what to worry about, recommending and monitoring the actions that give them confidence. Increasingly, it is also looking at cross-Departmental themes such as programme delivery, digital innovation, information management and the impact of the Functions.
 

●       The Legal Function brings together legal professionals across Government. Governments draw continuously upon the skills of their lawyers as they bring to life the policies pledged in their election manifestos. Government lawyers are called upon to advise whether a policy can be implemented under existing legislation and, if so, how. If new, primary legislation is required, lawyers play a key role in helping to prepare the bill and taking it through Parliament. Government lawyers also undertake litigation, advisory and commercial work to support the Government’s operation and priorities.
 

●       The Project Delivery Function is hosted by the IPA, the government’s centre of expertise for infrastructure and major projects. The IPA supports the successful delivery of all major types of infrastructure and major projects, and leads the project delivery and project finance professions across government.

●       The Property Function, overseen by the Office of Government Property, enables the delivery of public services that are more accessible and responsive to citizens’ needs and bring together property and socio-economic data to co-locate these services where they are most needed. This aligns with the aims of the Government’s Industrial Strategy to have prosperous communities throughout the UK by supporting the creation of jobs, the regeneration of our towns and cities, and the release of surplus land for new homes.
 

●       The Security Function is the newest of the Government Functions and is responsible  for the delivery of security services across physical, personnel and cyber security by a talented cadre of 1,700 security professionals across government. We are modernising and transforming security; moving from a traditional, inflexible controls-based approach, towards an approach where individuals and organisations are empowered to make risk based-decisions that are properly informed by knowledge of security threats. We identify security vulnerabilities and respond effectively to those who attempt to destabilize our operations.

Annex C: life cycle of major programmes in Government[27]

Annex D: core principles from the Government Project Delivery Standard[28]

At all times, those directing and managing portfolios, programmes and projects shall ensure that:

1. delivery objectives are aligned to government policy and organisational objectives;
    
2. continuing business justification to confirm benefits can be realised and risks managed within the organisation’s risk appetite, and that unjustified work is terminated;
    
3. governance, management frameworks and controls are proportionate and appropriate to the work and the level of prevailing risk;
    
4. accountabilities and responsibilities are defined, mutually consistent and traceable across all levels of management;
    
5. experience and lessons are captured, shared and used to promote future performance improvement;
    
6. work is appropriately defined, planned, monitored and controlled, quality is actively managed to maximise the likelihood of success and defined working methodologies are tailored for use accordingly;
    
7. outcomes and enabling outputs will meet the need and be validated by stakeholders;
    
8. work is undertaken in multidisciplinary teams and is assigned to people who have the required capability and capacity; and
    
9. the transition of capabilities to operations is planned and programme or project closure managed, with ongoing operational responsibilities agreed and accepted.

Annex E: project and programme delivery case studies (drawn from entries to the Civil Service Awards)

1. Ministry of Defence: Clyde Security Organisation

●       Aim: To provide a single integrated system to authorise access to secure areas and deploy staff in an agile way.

●       Challenge: To collect, collate, conduct assurance checks, photograph and issue passes to over 9,000 permanent members of staff.

●       Approach: The project created a new standalone database in which each member of permanent staff across Clyde has a single Security Access Smartcard linked to their database record, detailing security clearance and authorised access rights, and logging who is on site and where.

●       Outcome: Staff could be deployed quickly without previous restrictive administrative and financial burdens. The associated accreditation, training and operational documentation was designed to be replicated at other sites.

2. Department for Transport: Heathrow Expansion Programme

●       Aim: To establish detailed Government policy to secure the UK's future as an outward facing, globally strategic hub for aviation by expanding Heathrow Airport, following the government’s decision in 2016 that a Northwest runway at Heathrow Airport was its preferred scheme.

●       Challenge: To establish a clear way forward in a highly complex environment with a wide range of stakeholders, and in the context of significant political uncertainty and public scrutiny.

●       Approach: The project team engaged with the public through two public consultations and the creation of an independent Heathrow Community Engagement Board; ensured complete transparency in the decision making process; and facilitated engagement between Heathrow Airport Limited and airlines on potential scheme design and the costs of expansion, helping to identify a potential £2.5bn scheme cost saving.
 

●       Outcome: Finalisation of an Airports National Policy Statement (NPS) - successfully voted through the House of Commons and designated as government policy by the Secretary of State for Transport in June 2018.

• "This was a once-in-a-generation achievement made possible by assiduous management of a highly complex and challenging programme, which brought out the very best of the Civil Service”. Chris Grayling, Secretary of State for Transport
• "The team’s ability to manage propriety and scrutiny in getting to designation of the Airports NPS while also planning a coherent transition towards ultimate delivery warrants recognition". Andrew Farrimond, Infrastructure and Projects Authority

3. Met Office: Renewal of the UK’s national weather radar network

●       Aim: To use the latest technology to increase radar capability to improve quality control and rainfall rate accuracy; provide a platform for future capability increases; and extend the operational life of the network by a further 15-20 years.

●       Challenge: Many Met Office radar sites date back more than 20 years and are run through an antiquated and increasingly difficult to maintain system.

●       Approach: The Met Office developed the system in-house and created bespoke radar, rather than procuring an off-the-shelf system. This helped to future-proof the system and secured best value for money.

●       Outcome: The capabilities of the overhauled system are of vital importance for mapping rainfall rates and locations, in order to forecast potential flood impacts on communities. Enhanced real-time data will support decision-making and potentially improve the timeliness of extreme weather alerts.

4. Ministry of Justice: Technology Transition Programme

●       Aim: To deliver better technology to staff and judges across the Ministry of Justice by bringing in new laptops, desktops and smartphone devices; software; email infrastructure and addresses; and network upgrades.

●       Challenge: To reach 90,000 staff across 920 sites throughout the UK while maintaining business continuity.

●       Approach: The project started with an assessment of existing services and, where these were ineffective, sought to disaggregate them as much as possible so that they could be improved or replaced with minimal disruption.

●       Outcome: Over 40,000 staff received faster laptops, desktops and new smartphones, enabling them to work more flexibly and collaboratively, reduce reliance on the Government estate, save money and close security vulnerabilities.

5. Driver and Vehicle Licensing Agency (DVLA): Register a Vehicle Project

●       Aim: To capture additional data, as required by legislative changes, when vehicles are registered with the DVLA.

●       Challenge: To expand the project beyond its original aim to a complete redesign of the service, as collaboration with stakeholders (including motoring trade bodies, motor manufacturers and retailers) made apparent the need for major changes to keep up with shifts in the motoring industry

●       Approach: The DVLA team worked with internal and external colleagues to conduct a comprehensive review of vehicle registration business rules, legislation and future initiatives, in order to build a future-proof service that accurately captures vehicle data.
 

●       Outcome: A new digital service for registering vehicles, providing the flexibility to meet the needs of industry and government. Vehicle records are stored in a cloud based environment, replacing DVLA legacy IT systems.

6. HM Revenue and Customs: Transcash withdrawal

●       Aim: To mitigate the impact on customers of the imminent withdrawal of Transcash, a service allowing people to pay tax and bills at Post Offices.

●       Challenge: A replacement service was incompatible with HMRC’s IT systems, while adapting the system was unfeasibly resource-intensive, particularly given competing priorities such as Making Tax Digital and EU exit preparation.

●       Approach: HMRC created a rapid action project team which - after concluding that adapting the replacement service for HMRC was unfeasible - secured Ministerial agreement to an extensive campaign of targeted communication and support to move people onto alternative payment methods.

●       Outcome: The project helped HMRC’s Transcash customers adapt to its withdrawal, saved over £1m in bank charges each year, and delivered £3m worth of benefits through maximising synergies between projects.

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