The National Audit Office published a report on the Major Projects Authority (MPA) and its role in providing assurance for major UK government projects. [1] The report found that while the MPA has done good work with limited resources, it faces challenges in collaborating with other government departments and showing the full benefits and returns on the government's £376 billion investment in major projects. [2] Specifically, the MPA needs more staff and resources to fulfill its role, and greater engagement from HM Treasury to inform investment decisions and ensure portfolio optimization. [3]

1.
Top 4 observations
National Audit Office report:
Assurance for Major Projects
10 May 2012
www.MrPortfolioManagement.com @MrPortfolio

2. Introduction: Key Facts:
The National Audit Office (NAO) exists to o There are 205 projects in the MPA
provide independent opinion and evidence portfolio and 39 of those have a
to assist Parliament to hold government to confidence status of red or amber/red
account. I like them a lot.
o Whole life costs are £376bn
The Major Projects Authority (MPA) was
set up in March 2011 under a prime o £345bn of that is spent by MoD, Energy
ministerial mandate to optimize the & Climate Change, Transport, Work &
assurance of the government’s investment Pensions and Health.
in major projects. The MPA is a
partnership between Cabinet Office and o £14.6bn will be spent on these projects
HM Treasury reporting jointly to the this year, or £27.7k per hour depending
Minister for the Cabinet Office and the on how you look at it.
Chief Secretary to the Treasury. I like
these guys too. o MPA undertook 172 reviews last year
and plans on 205 this year.
On 2 May 2012 The National Audit Office
published a very interesting report called
Assurance for Major Projects. This little
report summarises my top 4 observations
after reading the whole review report
Important Note: The views and opinions
expressed in this document are those of
the author and do not reflect the views of
any other party what so ever.
You can download the full report from the
NAO website:
www.nao.org.uk
www.MrPortfolioManagement.com @MrPortfolio

3. Observation 1: Observation 2:
Resources, Resource, Resource Collaboration for the Nation
The MPA has done some pretty fabulous The report highlighted that the success of
work since it was started and this is the MPA depends on close collaboration
recognised throughout the report. Also with other government departments.
highlighted is MPA’s biggest issue,
insufficient resources. HM Treasury has attended 2 of the 6 MPA
Board meetings, which isn’t very polite.
Interestingly the report highlighted that the
MPA is delivering more assurance reviews More worrying is that HM Treasury does
on more projects in more depth with 40% not use the information that MPA collates
less staff than the Office of Government on projects as part of its investment
Commerce (OGC) did. decision-making. Furthermore the report
stated that Senior Treasury Officials “do
The problem is there are not enough not believe its role is to routinely consider
reviewers, departments are not forthcoming the cross-government portfolio
with providing reviewers and those that do, perspective when making investment
only work for 1 week twice per year. decisions”.
Furthermore the use of consultants has
significantly reduced (51 in Q2 2010 The MPA collects data from projects
reducing to 6 in Q3 2011 but has increased within a quarterly reporting process. If any
to 21 in Q42011). of you know how hard it is to put this in
place across one organisation you’ll
Maybe it’s time to incorporate a mandatory 6 appreciate how difficult it must have been
months stint in the MPA for senior civil for all of government! Bit pat on the back
servants as part of their career progression. for MPA I say!
This exposure to project assurance will then
help them become the SRO stars of Not surprisingly though, the reporting
tomorrow (like the Ozzies do). contains inconsistencies and varying
levels of quality. For example over 10% of
Finally, if we are spending this kind of money projects did not include full life costs in
on projects, surely a couple of pennies can their return for Jan 2012.
be ring fenced for more consultants?
(consider my hand raised).
www.MrPortfolioManagement.com @MrPortfolio

4. Observation 3: Observation 4:
Benefits and loving A country’s Portfolio Office
The Audit report suggests that MPA needs One could view the MPA as the biggest
to show its value, and therefore should baddest portfolio office in the country. It
track the benefits that are realised from focuses on the government’s portfolio of
the recommendations it makes in reviews. major projects, it reports status, enhances
decision-making, informs investment
Whilst I agree that showing the value of decisions (potentially) and provides
MPA should be a priority, I’m not standards and assurance.
convinced that tracking the benefits from
each action would be the most effective Whilst the report highlighted that the MPA
way to do it. would be providing an Annual Report in
June, there was no mention of a need to
Depending on the action, this could be create a Portfolio Delivery Strategy or
very challenging (and tenuous). Although prioritize the projects. Both would enable
it would work for actions that have a direct increased visibility and better allocation of
financial benefit such as dismantling a resources.
project (take a bow NPfIT).
I appreciate that the thought of projects
Whilst the report identifies that the MPA being prioritized and resources being
collect benefits information on projects, at shared across government may be a bit
no stage does it identify the need for MPA utopian, but a man is allowed to dream
to ‘assure’ the overall return on investment isn’t he?
and total loving that the country gets from
implementing the investment of £376bn. However, to produce a decent Portfolio
Delivery Strategy the MPA will need the
This is a shame, as you may have read in right data and given that the report states
my last blog the potential of showing an MPA does not collect project start and
overall return on investment trajectory was finish dates (which I find hard to believe),
getting me very excited, it still is! creating such a document would not be
possible.
www.MrPortfolioManagement.com @MrPortfolio

5. I think that…
MPA must be provided with the resources
it needs to be successful.
HM Treasury should attend all of the MPA
Board meetings without exception.
MPA should produce a cost and benefit
trajectory based on all the business cases
it has visibility of.
MPA should publish a Portfolio Delivery
Strategy (or equivalent) that pulls it all
together with timelines, priorities, costs
and return on investment. Yes, this would
be tough, but nothing worth doing is ever
easy.
Government should mandate 6 months
MPA experience as part of Senior Civil
Servant career paths. This would boost
assurance skills and help these people
become SRO stars of the future.
MPA should be allowed to employ more
consultants to help fill skills gap (hand
raised again).
Final note to the reader.
If you found this report useful, send me a
little tweet to let me know. It’s always nice
to get a tweet.
www.MrPortfolioManagement.com @MrPortfolio