5. NAO Briefing Note for Public Accounts Committee, Governance SIG Spring newsletter 2016

5. NAO Briefing Note for Public Accounts Committee

A recent briefing to the Committee of Public Accounts (January 2016) by the National Audit Office (NAO) has implications for the governance and assurance of projects, programmes and portfolios within the public sector.

The briefing notes that in June 2015, 149 projects with a whole-life cost of £511 billion were held within the government's Major Projects Portfolio; and that of these 34% assessed successful delivery as being 'in doubt or unachievable unless action is taken'. The briefing goes on to report that it is not possible to estimate how much of the government's business is delivered through projects, although it suggests that nearly twice as much is being spent on capital projects outside the portfolio – to bring the total to a possible £1.5 trillion.

The briefing observes that 'the track record in delivering government projects has been poor', and identifies recurring issues contributing to this poor performance, including: an absence of portfolio management at both departmental and government level; lack of clear, consistent data with which to measure performance; and lack of clear accountability for leadership of a project.

'Welcome developments' to address identified issues include: greater clarity as to the role of senior responsible officers; improvements in staff capability; and increased assurance and recognition of the role of assurance.

It notes that it is difficult to state whether performance is improving without reliable and consistent measure of project success; that it is 'worrying' that delivery confidence shows a mixed picture, of high risks to delivery of projects; and that progress in improving portfolio management is 'disappointing'. The Infrastructure and Projects Authority (IPA) has taken 'positive' steps to develop capability and provide greater assurance.

The three key challenges for the IPA have been identified by the NAO as:

Preventing departments from making firm commitments on cost and timescales before plans have been properly tested
Effective prioritisation of projects according to strategic importance
The need for systems and data which will allow proper performance measurement

The analysis in the NAO briefing reflects the four main components of effective governance of project management, recorded in Directing Change (2011):