Business case approval process – Capital Investment, Property, Equipment and Digital Technology

The Project Appraisal Unit (PAU)

The NHS England Project Appraisal Unit is a small specialist central team within NHS England Strategic Finance comprising of experienced capital investment and estates professionals who will be available to provide support to officers of NHS England at local Director of Commissioning Operations (DCO) offices, Sustainability and Transformation Partnerships, Regional Team, Commissioning Support Units, Commissioning Support Unit Transition Team (CSUTT) and National Team levels, and to CCGs, as they:

  • develop ‘right first time’ Business Case submissions;
  • pilot these through a ‘once only’ assurance process to an approval decision.

The NHS England Project Appraisal Unit will accordingly focus its efforts, primarily on providing pin-point advice to project sponsors and their delivery partners as they develop commitment propositions and the associated Business Cases, so that finalised Business Cases at the point of submission will already have pre-empted all material assurance/approval critical issues.

Project Appraisal Unit (PAU) documents, templates and forms

The purpose for this guidance and related documents

More detail can be found in the guidance document itself: NHS England Business Case Approvals Process Guidance.

This guidance takes as its foundation the NHS England Standing Financial Instructions (SFIs) and Scheme of Delegation, and provides a guide to navigate staff through the guiding principles, rules of delegation and underpinning processes upon which all officers of NHS England and Clinical Commissioning Groups (CCGs) should base their approach to the development, assurance and approvals process for propositions to commit NHS England or CCGs to:

  • the expenditure of capital, or investment in property, infrastructure or information and communications technology; or
  • the revenue expenditure or consequences for commissioners directly where a third party makes any such investment at their request or discretion;

For convenience these propositions are collectively referred to as ‘Business Cases’.

Important note on the difference between Capital and Corestream Business Cases

It should be noted that the term ‘Business Case’ as used in this paper is distinct from the ‘Corestream’ business cases required by NHS England Commercial for the purposes of securing procurement and spend approval for NHS England investments. In some cases, where approval is confirmed in accordance with the guidance in relation to a capital investment business case which proposes procurement of the relevant goods and/or services by NHS England, there will be a requirement for a ‘Corestream’ business case to seek subsequent procurement and spend approval.

Advice should be sought from the Project Appraisal Unit if there is any doubt as to whether any particular proposal is a capital commitment requiring formal approval as such under the relevant provisions of the NHS England Standing Financial Instructions and Scheme of Delegation.

Background to this Capital guidance

This most recent version of the guidance (2018) is published following an extensive period of revision informed by consultation with stakeholders, most importantly those who work most closely with the development, assurance and delivery of NHS capital investment projects and programmes. The changes in this refresh of the guidance respond to requests from our stakeholders to provide it in the easiest to access format possible.

The NHS England business case development, assurance and approval process has been developed to enable local commissioners, Sustainability and Transformation Partnerships and regional teams to develop and assure business cases, which are properly constructed and have strong local ownership, with greater confidence that investment propositions will be “right first time” and can sustain timely and efficient approval decision making.

Proposals for service change and reconfiguration

As regards, the extent to which these drive requirements for capital investment, and the approach to be taken to associated business case development, assurance and approval, please refer to Planning, Assuring and Delivering Service Change for Patients (NHS England, March 2018).

Examples of commissioner commitments

These include support to an investment of NHS Property Services Ltd customer capital, a PPP, e.g. LIFT, or PFI scheme, or a public funded development whether or not driven by wider service change and/or reconfiguration

The following are examples of the types of Business Case commitment that this guidance covers. This is not an exhaustive list, and is provided for illustrative purposes only:

  • new and replacement healthcare facilities, e.g. health centres, urgent treatment centres, urgent & emergency care centres, diagnostic and treatment facilities, hospitals, and refurbishment of existing healthcare facilities;
  • new and replacement clinical equipment (where capitalisable), e.g. imaging equipment, for example radiology and ultrasound;
  • new and replacement administrative facilities, e.g. offices and headquarters;
  • new and replacement non-clinical equipment, e.g. office furniture and equipment (where capitalisable), telephony;
  • new and replacement clinical information systems and managed services arrangements, e.g. Electronic Patient Record, Picture Archiving and Communications systems, Radiology Information Systems, Community and Child Health systems, Electronic Prescribing systems, systems which are part of the Digital Transformation Programme portfolio;
  • new and replacement non-clinical information systems and managed services arrangements, e.g. Finance systems, Performance Management reporting systems, Office Administration systems.

At an early stage of project development, sponsors and project management teams should ascertain with clarity whether or not a proposed commitment in respect of NHS England revenue might be counted as ‘capital’ for approval purposes, for example where revenue is being deployed for service development, but includes procurement of a managed information system that has to be considered for approval as a capital investment transaction under the rules set out by the DHSC, and which may well also be subject to Cabinet Office spending controls.