Common use of Transparency and Accountability Clause in Contracts

Transparency and Accountability. To ensure high levels of public accountability and to avoid biases, the identification and valuation of costs and benefits need to be undertaken transparently and objectively. Specifically, guarding against overestimation of benefits, which is often linked to an unrealistically high estimate of the annual rate of growth of benefits while, conversely, underestimation of costs often involves excluding some relevant costs. There is also a need to guard against underestimation of benefits when not all important benefits are accounted for. For example, the travel cost method addresses only some of the values associated with an environmental asset. The following will be required by decision makers and, consequently, should be considered by practitioners when preparing a BCA: An assessment of whether appropriate techniques have been used to identify and value key variables and address major uncertainties that could materially influence the economics of alternative policies – that is, a demonstration that the preferred policy is, in fact, the most cost effective method of achieving the desired outcome. A critique to test the significance of key variables to determine the value of more information, taking into account the likely cost of delay. Provision of descriptions of all known assumptions, biases, and omissions. A statement of how, or if, the BCA is going to be made accessible and revisited as more data or time becomes available or as the circumstances of the analysis change. Advice on the level of confidence / margins for error in the results of the BCA. Advice on whether the BCA has been subject to independent peer review. An assessment of whether the analysis has taken into consideration Commonwealth and relevant state/territory benefit:cost analysis guidelines.

Transparency and Accountability. To ensure high levels of public accountability and to avoid biases, the identification and valuation of costs and benefits need to be undertaken transparently and objectively. Specifically, guarding against overestimation of benefits, which is often linked to an unrealistically high estimate of the annual rate of growth of benefits while, conversely, underestimation of costs often involves excluding some relevant costs. There is also a need to guard against underestimation of benefits when not all important benefits are accounted for. For example, the travel cost method addresses only some of the values associated with an environmental asset. The following will be required by decision makers and, consequently, should be considered by practitioners when preparing a BCA: : (a) An assessment of whether appropriate techniques have been used to identify and value key variables and address major uncertainties that could materially influence the economics of alternative policies – that is, a demonstration that the preferred policy is, in fact, the most cost effective method of achieving the desired outcome. . (b) A critique to test the significance of key variables to determine the value of more information, taking into account the likely cost of delay. . (c) Provision of descriptions of all known assumptions, biases, and omissions. . (d) A statement of how, or if, the BCA is going to be made accessible and revisited as more data or time becomes available or as the circumstances of the analysis change. . (e) Advice on the level of confidence / margins for error in the results of the BCA. . (f) Advice on whether the BCA has been subject to independent peer review. . (g) An assessment of whether the analysis has taken into consideration Commonwealth and relevant state/territory benefit:cost analysis guidelines.