Strategic Investment Board needs to get its priorities right
Northern Ireland has a public sector investment programme costing over £1.2bn each year which calls for the careful selection of priorities and provision of efficient delivery systems. To manage this complex investment programme, the Strategic Investment Board (SIB) is a central source of specialist advice and support for government departments.
The SIB prepares the investment strategy for Northern Ireland. It also assists the various public sector departments to deliver their elements of the strategy. As an aspect of this role, the SIB works to improve the capability of the public sector to develop specialist skills.
Then, in a contribution to good housekeeping, the SIB houses an asset management unit to manage the public sector property assets, including realising capital funds by disposing of unneeded assets.
The annual report of the SIB for 2013-14 has now been published. It serves to emphasise two critical features.
First, the SIB does not decide the specific priorities for the investment strategy — that lies with ministers. Second, the SIB is extensively involved in wide ranging detailed implementation work in every government department.
To make this distinction, the SIB expresses itself carefully on politically sensitive subjects such as social housing reform or the development of the Maze Long Kesh project.
Over 50 current and planned projects are on the SIB agenda.
A few projects have not proceeded on the timetable originally expected.
This includes the full development of the Maze Long Kesh site, the initiation of the Lisanelly Shared Education Campus, contracts for the Belfast Rapid Transit scheme and the contract award for the Desertcreat public services training centre.
These examples illustrate the sometimes unclear line between delay as a result of lack of Executive agreement or a delay because the processes have proved more difficult to implement than expected.
Maze Long Kesh has been stalled following the unfinished political debate started over a year ago.
Delay on the Desertcreat project is a consequence of failure to finalise within an acceptable budget, a contract based on the initial tenders from five possible contractors. SIB is working with the project team to contribute to a revised design specification and the five approved tenderers will shortly be invited to rebid.
The initial preferred bidder must now be tested again against the bids from the other four. The hope is that construction work can begin in mid-2015.
Project delivery through tender, contract and selection is the normal mode for the public sector.
However, the SIB is now being encouraged to tackle the wider agenda which considers financing sources as well as execution of specified contracts.
Northern Ireland has a Treasury allocation for (what is known as) financial transactions capital (FTC) and SIB has been asked to consider its extended usage. Already the SIB has been the agency to receive and then lend £25m to the University of Ulster as a contribution to the York Street campus. The University of Ulster has accepted the obligation, in some years’ time, to repay this loan. A further £100m-plus for other FTC projects is earmarked for 2015-16.
This widening of the scope for selected investments is now on the agenda of the SIB for the concept of a new rail/bus transport and commercial hub building at Great Victoria Street and Glengall Street.
In parallel, a business case to bring to fulfilment the arc21, energy generating and waste disposal, project for that group of local authorities is evolving. Then in another variant, SIB is contributing to the planning of a £300m revenue funded project to enhance primary healthcare services. Pilot projects of this type are already being built in Newry and Lisburn.
The SIB has ‘fingers in very many pies’. Challenges to identify infrastructure priorities and reshape policies on social housing await firm proposals. The SIB now needs to be more targeted and selective in its involvement.