This section provides guidance on Step 4, Business Case development.
By the end of Step 3, a long list of options to solve a priority problem (identified in Step 2) will have been generated, and assessed. The assessment will first have identified a short- list of options through rapid assessment, and then a preferred solution through rigorous detailed assessment. If economically justified, the preferred solution becomes a ‘proposed initiative’. Step 4 involves the development of a Business Case that provides the justification for the proposed initiative, summarising all the work undertaken and results obtained in Steps 2 to 3. The proposed initiative can then proceed to Step 5 for prioritisation alongside other proposed initiatives.
Each proposed initiative requires a Business Case. It is the centrepiece for a proposed initiative and a vehicle for communication. The Business Case should clearly state and demonstrate the merit and justification for the initiative and ensure that all required evidence supporting the assessment of the initiative is properly documented. The Business Case should provide all the information required to:
- Enable the reader to effectively comprehend and assess the merit of the initiative, and assess this against the criteria stipulated by funding agencies (e.g. Infrastructure Australia or a Treasury Department)
- Provide certainty to decision-makers (e.g. Minister, Cabinet, Board of Directors, Council, Government agency) that they have been provided with sufficiently detailed information to assure them they are making a fully informed decision on the initiative.
The Business Case should:
- Clearly describe the preferred solution
- Document the problem assessment that justified proceeding to the consideration of solution options
- Document the full list of possible options that were generated and assessed
- Demonstrate through detailed appraisal data the justification for supporting the preferred option/solution
- Provide sufficient documentation so that the reader can fully understand the logic and sound evidence that supports the decision, including all relevant information, expressed in monetised and non-monetised terms (as relevant), as well as quantitative and qualitative terms.
In a future stage of updating the ATAP Guidelines, Business Case guidance will be further explored. This will include checking for learnings from processes such as the Better Business Case process established in New Zealand (NZ Government, 2014).