Applying the High Value High Risk Process to Unsolicited Proposals

Tabled: 19 August 2015

Effective infrastructure planning and delivery are critical to the state’s future prosperity and liveability. Government introduced the High Value High Risk (HVHR) process to address systematic weaknesses undermining agencies’ performance in managing major projects.

VAGO’s June 2014 HVHR audit called for the Department of Treasury and Finance (DTF) to apply the HVHR process to unsolicited proposals where the private sector approaches government with a proposal to build infrastructure and/or provide services.

DTF has not consistently applied the HVHR process to unsolicited proposals. DTF’s guidance falls short of ensuring a rigorous assessment of the likely benefits of unsolicited proposals, and of providing the transparency needed to enable affected stakeholders and the wider community to understand the full impacts.

Applying the HVHR process to the CityLink Tulla proposal has not resulted in the information underpinning this project’s approval comprehensively meeting DTF’s better practice guideline.

In contrast, the way in which the HVHR process was applied to the Cranbourne Pakenham interim offer was much better. However, it remains unclear how the absence of elements essential for defining and realising benefits, such as a cost benefit analysis and benefit management plan, would have been addressed to adequately inform government's consideration of a more detailed final offer.

My recommendations are designed to address deficiencies in how the HVHR process is applied to proposals and to improve how agencies scrutinise project benefits, assess funding options and engage affected stakeholders when informing government decisions.

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Audit team

Ray Winn

Engagement Leader

Kate Kuring

Team Leader

Sid Nair

Analyst
Engagement Quality Control Reviewer

Tony Brown

 

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Last updated on 8/31/2016