This section provides information, processes and procedures to assist Approved Organisations and the Transport Agency in using the Transport Agency’s Investment Assessment Framework (IAF) to assess and prioritise programmes, plans, projects and other activities.
The framework and priorities will be used by the Transport Agency in developing the National Land Transport Programme (NLTP) and to make subsequent investment decisions.
Links to detailed guidance will be found toward the bottom of this page.
The Government Policy Statement(external link) on Land Transport (GPS) establishes the government investment strategy, defining the results desired from National Land Transport Fund (NLTF) investment. Developing the IAF is the Transport Agency’s first step in operationalising the GPS to enable the Agency to give effect to the GPS. The principles and high level criteria of the IAF are approved by the Transport Agency Board.
The IAF uses three factors (strategic fit, effectiveness, and benefit and cost appraisal) to determine how well proposed activities meet the government’s investment strategy as defined in the GPS.
The Transport Agency refers to a number of tools that support assessment, e.g. the Economic Evaluation Manual. These relate to achieving GPS results, as well as demonstrating good process and efficient allocation of resource or effort.
When evaluating programmes and projects, the GPS requires Approved Organisations and the Transport Agency to consider best value for money.
Value for money has been defined in a variety of ways. In general, it means:
This requires taking a long-term, whole of life view of the total value for money attributable to a programme or activity, not just the initial capital cost. A whole-of-life assessment will consider:
The Transport Agency uses the IAF to assist it achieve value for money in selecting the right investments, as it:
Assessment using the IAF involves rating programmes, projects or other activities across three factors, being the:
A priority order is assigned to activities using each of the three factors:
Each factor can be assessed as "low', "medium" or "High". As a rule, only proposals assessed with at least a medium strategic fit and medium effectiveness will progress to prioritisation for inclusion in the NTLP. Proposals assessed as having low strategic fit remain at the strategic business case stage and proposals assessed as having low effectiveness do not progress beyond programme business case.
The three factors are combined into an assessment profile that applies to specific projects and programmes, e.g. HM2.5 denotes an activity with high strategic fit, medium effectiveness and a benefit-cost ratio of 2.6.
The assessment profile assigned to individual activities must be reviewed at each stage of the activity's development and updated as necessary to reflect the latest information and any changed circumstances.
An activity’s profile assessed at the time of NLTP inclusion must be confirmed prior to any investment and funding decision. This may result in a reduced profile if the Transport Agency considers the evidence to be insufficient or that the risks around delivery of the activity’s outcomes are too high.
The Transport Agency requires all Approved Organisations and Transport Agency groups to use the IAF to assess activities and combinations of activities they propose for inclusion in the NLTP.
Regional Transport Committees (RTCs) may choose to prioritise the activities in their Regional Land Transport Plans (RLTPs) in any way they may determine. However, if RTCs use the IAF to prioritise activities proposed for NLTF funding in their RLTPs, this provides greater consistency with GPS results.
RLTPs are also required to include all other regionally significant expenditure on land transport activities to be funded from sources other than the NLTF. We encourage RTCs to apply the same assessment to these other activities to assist in the overall transparency and integrated planning of all land transport activity.