Drivers for whole life performance

The key drivers for whole life performance and whole life costing are government preferred procurement routes to revitalise the public building stock, namely the Private Finance Initiative (PFI) and Public Private Partnerships (PPP). These are discussed in more detail in Procurement routes.

Official guidance

There is a wealth of official guidance directing practitioners to look beyond the short term issues of construction. Decisions and investments concerning construction should be for the long term.

The UK government has issued a number of documents on whole life costs.

Whole life costs

The Office of Government Commerce's Construction Procurement Guidance on Whole life costing and cost management (2007) was aimed at anyone who is undertaking, or has an involvement with the government client role in construction, in particular those exercising the key roles of investment decision maker, project owner and project sponsor. It emphasises that:

'Value for money is the optimum combination of whole-life cost and quality to meet the user's requirement. This means that awarding contracts on the basis of lowest price tendered for construction works is rarely value for money; long-term value over the life of the asset is a much more reliable indicator. It is the relationship between long-term costs and the benefit achieved by clients that represents value for money.'

Sustainability

The Office of Government Commerce, 2000, Constructing the Best Government Client. Achieving Sustainability in Construction Procurement. Sustainability Action Plan requires that:

' ... all government departments use whole life cost assessments as part of the technical appraisal for decision to build new or refurbish existing assets.'

Proposal appraisal and evaluation

The Green Book on project appraisal and evaluation in central government preface states:

'This new edition incorporates revised guidance, to encourage a more thorough, long-term and analytically robust approach to appraisal and evaluation. It is relevant to all appraisals and evaluations.'

The Egan Report 1998 - Rethinking Construction

Sir John Egan reported on the scope for improving the quality and efficiency of UK construction.

'...design needs to encompass whole life costs, including costs of energy consumption and maintenance costs. Sustainability is equally important. ... The industry needs to educate and help its clients to differentiate between best value and lowest price.'