Chapter 2-2 of this volume, Project Management, establishes the minimum mandatory requirements for the management of all projects within the applicability limits defined in that chapter. This policy chapter sets out the additional requirements for the management of Major Crown Projects (MCPs).
The key MCP policy concepts, including the factor of project risk in determining the management framework and the advisory-only role of the project committee, were approved by Treasury Board in 1990/91. This policy presents these key concepts in a more concise format with common elements moved to the other chapters of this volume.
A project is deemed to be a Major Crown Project when its estimated cost will exceed $100 million and the Treasury Board (TB) would assess the project as high risk. However, Treasury Board may require any project exceeding the sponsoring minister's delegated project approval authority to be managed as an MCP. As well, provision is made in this policy for a sponsoring department to request approval from Treasury Board to manage a project exceeding $100 million but of lesser risk within a tailored MCP regime or outside the MCP management framework.
The additional aspects of managing MCPs include obtaining approval-in-principle from Cabinet for an MCP having significant policy or fiscal framework implications, and the following Treasury Board mandatory requirements:
This policy emphasizes that the project management framework must be tailored throughout the life of the project on the basis of an up-to-date risk assessment.
To achieve effective and economical management of Major Crown Projects with visible and clearly established project leadership.
In addition to the need for sponsoring departments to coordinate and obtain approval-in-principle from Cabinet for MCPs having significant policy implications or affecting the fiscal framework, it is the policy of the government that Major Crown Projects (MCPs) be managed within a special regime:
This policy applies to departments and agencies listed in Schedules I and II of the Financial Administration Act.
The policy applies to projects and capital projects as defined in the Glossary of this volume. It applies to all such projects funded in whole or in part by the federal government regardless of whether the method of funding is through outright purchase, lease/purchase, lease, or some other arrangement. This policy does not apply to certain project-like activities funded by the federal government through Transfer Payments (Grants or Contributions) or assisted through loan guarantees or other contingent liabilities. Treasury Board policies for the approval, financial and managerial aspects of these activities are provided in the Treasury Board Manual, Financial Administration volume.
Project leaders must notify other federal government departments or agencies that have general responsibilities within SPACs or that may be affected by a specific project, inviting them to participate in an active or coordinative role as appropriate.
Participating departments are to determine the nature and degree of the effect of the proposed project on their operations, asset base or other interests. They then respond to the project leader, defining the nature and extent of proposed participation in the project. Joint commitment to any project-specific activity to be carried out by a participating department, which is deemed essential to the success of the project by the Project Leader, must be documented in an appropriate interdepartmental agreement.
Participating departments are to select their representatives from within senior management levels and based upon criteria including: project management experience and abilities: and the significance, scope, complexity, risk, and visibility of the project.
The contracting authority is responsible:
The Treasury Board Secretariat is responsible for:
Departments are to monitor the application of this policy by their project leaders. Treasury Board Secretariat will monitor departmental compliance with the intent and the specifics of this policy through review of project approval submissions.
The Administrative Policy Branch, Treasury Board Secretariat, will periodically review the effectiveness of this policy.
This policy replaces Chapter 2 of the Procurement and Project Management volume of the Treasury Board Manual. It is issued under the authority of section 7 of the Financial Administration Act. It should be read in conjunction with the other chapters in this volume; and other Treasury Board policies, particularly those dealing with Risk Management, Real Property, Information Technology Management, Materiel Management, Procurement review, Contracting and Common Service Organizations.
For enquiries related to policy interpretation or concerning submissions related to contracts for specific projects, departments should contact the Executive Director, Procurement and Project Management Policy Directorate, Comptrollership Branch, Treasury Board Secretariat.
For questions relating to details of specific projects, departments should contact their analyst within Treasury Board Secretariat Program Sectors and, as appropriate, their specialist analyst in the Real Property and Materiel Policy Directorate or the Chief Information Officer Branch.
The project leader is directly accountable to the deputy minister for:
The responsibilities of the project leader include:
The project leader must determine which departments are potentially affected by, or could have program interests in, the MCP. The project leader must ensure that these departments are notified in writing as early as possible in the life of the project so that they may decide whether they should formally participate in the MCP. Whenever an MCP is likely to require private sector involvement, the departments notified must include appropriate contracting authorities and industrial and regional benefit authorities.
The majority of MCPs will be procurement projects, which are subject to the procurement review policy. Sponsoring departments should refer to this policy for more guidance. Departments sponsoring procurement projects must, as a minimum, notify the following departments:
The role of the SPAC is to consider appropriate steps to orient a major project to achieve relevant national objectives. When appropriate, the SPAC stimulates agreements between the sponsoring and relevant participating departments, and acts as a forum for resolving issues that arise. The project leader chairs the SPAC and keeps it informed on the status of the project. The committee provides a forum for reviewing and discussing project objectives, requests for proposals and other key project instruments. The SPAC performs the role of procurement review similar to that which accomplished by the Procurement Review Committee (PRC) for projects of value less than $100M.
Whenever it is necessary that a Cabinet committee consider the strategic direction of an MCP, the sponsoring department must consult with Treasury Board Secretariat so that its views on the financial and policy impact are included in the Memorandum to Cabinet.
Before preparing submissions for, or amendments to a project or contract approval, the sponsoring department and the contracting authority, respectively, should seek advice from Treasury Board Secretariat to ensure that ministers are provided with the appropriate supporting information. The sponsoring department may use the PPRA, or less formal means as appropriate, for this purpose.
Submissions for project approval must be concisely written and in accordance with the format and content requirements of Chapter 2-1 of this volume. In addition, both the PPA, EPA or LPA must be accompanied by an updated Project Brief.
The purpose of the Project Brief is to replace or supplement, as required, the function of the departmental Long-term Capital Plan for a particular MCP. It must describe the estimated impact of the complete MCP on the fiscal framework, any impact on existing or proposed legislation or government policy, and any direction received. It must show the relationship between the project, government objectives, departmental priorities and long-term strategic planning. It must provide a summary of the full scope of the project, permitting the submission documents to be written as succinctly as possible. Additional details regarding project brief requirements can be found in Appendix F of Chapter 2-1.
The sponsoring department must inform Treasury Board Secretariat immediately should it determine that approved project objectives must be changed or cannot be met within the expenditures authorized. Reporting of minor schedule changes without cost impact is within the sponsoring department's discretion. The Treasury Board Secretariat will advise the department if a submission is required.
A detailed statement of the reasons for the submission must be provided, with an explanation of what actions have been taken or considered by the department. The sponsoring department's communications plan must be referred to in the submission whenever the subject matter is likely to attract any form of public attention requiring a response from the government.
The following information is required:
The project leader is accountable for preparing a submission to Treasury Board requesting amendment of the current EPA as soon as a significant cost overrun condition is detected (as defined in the project approval policy, Chapter 2-1 of this volume). The project manager can detect a potential project overrun situation early on by analysing cost, schedule and performance indices in the reports generated by the contractor's cost and performance management system.
Increases in projected cost due to a change in the performance or schedule objectives of the project is not a cost overrun; however, these changes must be submitted for approval to Treasury Board in the form of amendments to the submission documents (PPA, EPA or LPA). Similarly, changes in performance or schedule proposed to avoid cost overrun must be submitted to Treasury Board for approval in the form of amendments to the PPA, EPA or LPA.
The reports should be comprehensive but concise, and prepared in accordance with the guidelines provided in Chapter 2-2 of this volume.