Unrealistic costs estimated for the project
Risks
- Wrong amount of funds allocated
- Project not funded because costs are too high
- Funds miss-allocated to project that could be used elsewhere
- Wrong competitive procurement process followed leading to risk of challenge under EU procurement rules
Solutions
- Use the Whole Life Costing Model to explore and identify the operating and end of life costs of the proposed purchase.
- Prepare an outline business case and an options appraisal that explores the likely costs and benefits of the procurement
- Ensure the value of proposed projects follow the valuation methods published in the procurement legislation
Consideration not given to future costs associated with the procurement
Risks
- Insufficient funds or other resources (staff etc) available to ensure the best use is made of the goods or services
- Inefficient use of the procured goods or services
- Funds are wasted
Solutions
- Use the Whole Life Costing Model to explore and identify the operating and end of life costs of the proposed purchase.
Need not challenged
Risks
- Unnecessary or inappropriate purchase made and funds used that could have been put to better use
Solutions
- Ensure that questions are asked when a requirement is proposed. The level of challenge should reflect the value and complexity of the procurement.
Alternative solutions not considered
Risks
- Unnecessary or inappropriate purchase made and funds used that could have been put to better use
Solutions
- Ensure that questions are asked when a requirement is proposed. The level of challenge should reflect the value and complexity of the procurement.
Outline Business Case not prepared
Risks
- Alternative solutions not identified or considered
- Opportunity of a better solution is missed or a purchase made when it was not necessary
Solutions
- An outline business case and an options appraisal should be completed for all procurements above a stated value. The detail in both reflecting the value and complexity of the proposed procurement
- The Do Nothing options should always be considered in order to identify if there is a genuine need for the proposed goods or services
Investment Appraisal not completed
Risks
- Alternative solutions not identified or considered
- Opportunity of a better solution is missed or a purchase made when it was not necessary
Solutions
- An outline business case and an options appraisal should be completed for all procurements above a stated value. The detail in both reflecting the value and complexity of the proposed procurement
- The Do Nothing options should always be considered in order to identify if there is a genuine need for the proposed goods or services