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Accounts Officer Memo: Government Hubs and Whitehall Campus Program

An Accounting Officer Assessment for the Government Hubs and Whitehall Campus scheme has been conducted in line with the Cabinet Office’s commitment to publish Accounting Officer Assessments for Major Government Projects. This assessment of the accountant takes into account the four criteria of regularity, suitability, value for money and feasibility.

Background and context

The Government Hubs and Whitehall Campus program aims to deliver a vision of transforming central government’s aging office stock, ensuring it is more efficient, digitally connected, fit for purpose and supports modern ways of working. The Government Hubs and Whitehall Campus program supports the government’s strategic requirements to move 16,400 positions from London to regional hubs, and consolidate 37,000 FTEs in the regions by 2030.

The program aims to stimulate change and be a catalyst for the modernization of the public service and to support the vision of modernization and reform of the public service. This will be achieved through a consolidation of the government office portfolio through a reduction in the number of buildings and by ensuring that government offices support productivity and efficiency with more inclusive workplaces that promote health and the well-being of our staff.

The SR21 regulation will support:

  • Delivery of 16 new government centers and renovation/refurbishment of 5 buildings in Whitehall

  • Provides total cashable benefits with a net present value (NPV) of £1.7 billion over 20 years, achieved by;

  • Closure of c134 government buildings (c60 central London offices, c74 regional offices)

  • Creation of hub capacity by 2025 to relocate 9,326 people, increasing to 16,400 of the 22,000 Places for Growth (PfG) positions out of London and the South East by 2030

  • Consolidation of 37,000 FTE public service jobs in the regions by 2030

The business case for the program completed the UK Treasury approval process in April 2022. The program is firmly in the delivery phase with two projects completed in Birmingham, 23 Stephenson Street and in London, Old Admiralty Building.

This transformation will also see the area become more sustainable, with the creation of shared and carbon-free buildings. This will support the Government’s ambitions set out in the Government Domains Strategy, Industrial Strategy White Paper and spending priorities through:

  • Ensuring strong and innovative public services

  • Level up across the UK to increase and spread opportunities

  • Lead the transition to Net Zero across the country and more globally

  • Carry out our growth plan

The Government Hubs and Whitehall Campus program is more than just buildings; it is a catalyst for more fundamental change leading to the modernization of the public service.

Regularity

The GPA has invested in a trained commercial and legal team, all with expertise in public procurement regulations. They will work together to design and implement business strategies and present them to governance boards, both within GPA-compliant market access pathways and the Cabinet Office.

This will include achieving strong market engagement, selecting appropriate procedures, managing incumbent advantage, and implementing rigorous bid evaluation.

The central government expenditure estimation process gives the Cabinet Office department and GPA, as executive agency, the statutory authority to incur expenditure under the Appropriations and Appropriations Act. The program requires no additional legislation and complies with parliamentary expenditure control requirements, with program funds used only to the extent and for the purposes authorized by Parliament. The program adheres to the relevant UK Treasury approval procedures with the current capital projects program business case submission currently with HMT to be issued to CSE for review (once new government administration is in place) after prior approval of the CEO of GPA, CO CFO; Permanent Secretary of the CO and Minister for Efficiency.

Assessment of regularity: satisfied

Convenience

The Government Hubs and Whitehall Campus program is aligned with the government’s policy on delivering innovative public services, Leveling-Up across the UK, Net Zero and its growth plan.

Program assurance and approvals will be governed by the program governance and approvals structure of the Government Hubs and Whitehall Campus. The Program Committee reports to the GPA Executive Committee and is overseen by the Public Service Location and Property Board (LPB).

The Program Board is made up of representatives from all branches within GPA, the Capital Projects Strategic Partners, the Government Property Office, IPA, Her Majesty’s Treasury and the Department. The Government Centers and Whitehall Campus program undergoes assurance reviews by the IPA and is part of the Major Government Projects Portfolio (GMPP). Decisions regarding the acquisition of properties are also subject to national property controls and approvals from Her Majesty’s Treasury.

GPA has also developed an Acquisition Strategy, approved by the GPA Portfolio Committee, which outlines the acquisition of assets, whether on lease or full ownership of all new government properties, either directly on the market or from local authorities or other public sector landowners. The real estate acquisition strategy is the fundamental Value for Money (VfM) decision that GPA will take on behalf of the government with BNP Paribas and Jones Lang LaSalle acting as GPA’s strategic real estate transaction advisors, with Gowlings and Beechcrofts as legal advisers.

Merit Assessment: Achieved

Value for money

Value for money was assessed through a comprehensive options assessment documented in the program’s business case. The preferred delivery option offers the greatest potential to meet critical success criteria and minimize delivery risk for GPA, providing the best value for money. As well as internal GPA approvals, the file has also been secured and approved by both the Cabinet Office and HM Treasury.

Each project in the Government Hubs and Whitehall Campus program must develop a business case in accordance with the UK Treasury Green Book, aligned with the five-case model, and is subject to both an internal financial review in addition to the continued improvement of the Cabinet Office and UK Treasury expenditure controls.

For Government Centers and the Whitehall Campus, the GPA has a strategic asset management approach to developing a flexible portfolio in a given city. For location, there will be a case-by-case review to establish the best VfM for the government.

All procurement contracts awarded will be competitively tendered as required by the Cabinet Office procurement rules. The costs and benefits of the program will be measured and verified against the expectations that will be set out in the outline and full business cases for each project. This major government project is an exploratory program for IPA Transforming Infrastructure Performance (TIP) 2030.

Lessons learned are incorporated into the program and its individual projects with reviews held at the end of each stage of delivery. These are then applied to each project in the pipeline to ensure best practices are maintained throughout delivery.

Value for money assessment: met

Feasibility

The program is subject to GMPP requirements and is subject to review by the Infrastructure and Projects Authority (IPA).

GPA operates a ‘thin client’ model with a small staff team dedicated to program and project delivery that is fully integrated with industry partners in design and construction. In collaboration with our strategic partners (AECOM for project and cost management) and (Atkins for design), the program undertakes regular reviews of its key risks in terms of time, cost and quality results for each of the constituent projects. This regular review provides better cost assurance and establishes links with the wider construction industry to inform and manage inflation risk.

The program plan details the timeline for completion of individual projects and incorporates all individual project timelines and ensures that resources can be mapped and allocated where they are needed. The program plan is a live document that will be regularly updated, based on information from a number of stakeholders, including project progress.

Feasibility Assessment: Achieved

Conclusion

I am confident that the Government Centers and Whitehall Campus program is based on clear legal powers, upholds standards for the management of public funds and conforms to generally accepted principles of public life, representing value for money for the Chessboard as a whole, and is doable to deliver.

This summary will be published on the government website (GOV.UK). Copies will be deposited in the Library of the House of Commons and sent to the Comptroller and Auditor General and Treasury Accounts Officer.

Steven Boyd

General Manager, Government Real Estate Agency

August 25, 2022