NR NR/L2/P3M/223 ISSUE 1 PDF

This standard specifies the cost and commercial governance and guidance required for successfully delivery of cost and commercial outcomes within capital delivery projects and programmes.

This standard is part of the Capital Delivery Core Process and relates to NR/L2/P3M/201 and NR/L2/P3M/220.

It applies to projects that require Investment Authority as defined within IR01 Investment Regulations and enhance or renew the operational railway.

Pre-contract commercial administration is undertaken in line with the Contracts and Procurement (C&P) Policy and Procurement Management Framework (PMF).

Purpose

The Project, Programme and Portfolio management (P3M) framework policy and Project Acceleration in a Controlled Environment (PACE) describe how Network Rail manages and controls investment projects on the rail network.

Network Rail has developed this approach to managing projects in order to minimise and mitigate the risks associated with project development and delivery. PACE provides a more flexible control framework enabling sponsors and project managers to tailor the controls herein to better meet the requirements of their project. The PACE framework is shown in figure 1.

The approach is based on best practice within comparable industries that undertake major investment projects.

Application of this standard during investment projects on the rail network can reduce the reputational and financial risk related to poor stakeholder engagement practices.

The Cost and Commercial process seeks to embed a consistent approach to cost planning, cost analysis, budgeting, cost management and benchmarking principles needed for business planning and successful project and programme delivery. It covers all the cost and commercial activities from the Initiate to Project Close phases of NR/L2/P3M/201, including:

a) demonstrating value for money;

b) providing cost certainty and mitigates financial exposures;

c) supporting industry best practice for benchmarking cost; and

d) supporting effective commercial and financial management.