The Treasury advocates the BBC framework for all types of business cases, regardless of who has the decision rights.
In the State Sector
Cabinet Circular CO (19) 6: "Investment Management and Asset Performance in the State Services" states Cabinet expectations with regard to capital expenditure, asset disposals, lease arrangements, and "as a service" investments.
The Circular requires the use of the Treasury business case guidance for all significant investment proposals from relevant state sector agencies. The circular defines significant as:
[having] a high degree of importance in terms of its likely impact on, and likely consequences for the Crown or the agency or sector, customers or clients, or the capacity of State services agencies to perform their functions; or the government’s fiscal strategy; or the government’s investment or infrastructure strategy; or
An investment proposal that requires Cabinet or Ministerial approval as per Annex 1 [of the circular], that is, high risk proposals, or proposals with whole-of-life costs (WoLC) in excess of $15million, however funded.
The thresholds for significance for a given agency or sector may vary according to decisions made through the application of the Investor Confidence Rating.
Chief Executives are to ensure agencies adopt and apply, as good management practice, Treasury guidance on investment management, including business cases.
Boards of Crown entities and companies should adopt and apply, as good management practice, Treasury guidance on investment management, including business cases.
Sharing good practice and results
CO (19) 6 requires agencies to provide the Treasury with a copy of Cabinet-approved business cases (taking account of grounds for withholding information under the OIA), so that these can be shared with other agencies on the Public Sector Intranet. These business cases should be sent to [email protected] after redactions have been made.
Relationship with policy decisions
Where an investment decision is required in support of a policy decision, the reviewer (Treasury Vote Analyst, or Monitoring Agency) should be engaged at the earliest possible time. This will ensure the approach to the policy and investment decision is fit-for-purpose.
The approach to the business case will depend on whether it is to augment a Regulatory Impact Analysis, therefore to assist in informing the policy decision, or to support a policy decision that has already been made.
If the policy decision has been made much of the Strategic Case and elements of the Economic Case will already be incorporated into the policy decision and will not need to be revisited through the business case; a summary will likely suffice. The business case should focus on validating the Strategic Case, completing the Economic case and developing the Commercial, Financial and Management Cases. The Strategic and Economic Case may be developed in detail if there is a desire by the Senior Responsible Owner (ie Sponsor) or Reviewer to either challenge or validate the policy.
Agencies that are planning any significant investments (including any arrangements with Local Government Authorities seeking Crown funding or support) should evaluate all procurement options, including considering the use of Public Private Partnerships (PPPs) where appropriate and consistent with Government policy. Note that current government policy precludes initiating the use of new PPPs in the education, health and corrections sectors.
-  All departments (including departmental agencies) as defined by the Public Finance Act 1989 (PFA);1.2 the following types of Crown entities: Crown agents; Autonomous Crown entities; Independent Crown entities; Crown entity companies, including Crown Research Institutes; and companies listed on Schedule 4A of the Public Finance Act (PFA).