Many estates matters involve large scale procurement, often entailing medium or long term financial commitments. As a governor you will be concerned about the need to ensure value for money (VFM), particularly where expenditure is high. In some areas, this is a straightforward matter of market testing, but there will always be a need in VFM terms to make decisions on a spectrum stretching from entirely in house provision to entirely out sourced.
In some areas - say lift maintenance – an institution is likely simply to have a maintenance contract (subject, of course, to proper procurement and VFM tests). As a governor, in such cases you will probably have little or no input - the procurement procedures will have been approved by the governing body, which can thus be confident that they are fit for purpose. The procedures should, of course, be reviewed from time to time. In other areas - security for example - there is likely to be a similar choice between in house provision and external contracting. Whichever option is chosen, the service should be assessed periodically against the market to ensure VFM. When the service is external, this will usually be a straightforward process when a contract approaches its end or renewal point. When the service is internal, it should still be assessed: normally at least every seven years, but more regularly might be appropriate.
In some other areas, procurement decisions may be less clear cut. Institutions will want their own maintenance staff to deal with routine work, but there may be times when external contractors are needed, for example for large scale refurbishment.
More information [PDF, 35kb]
Governing bodies will also wish to consider Private Finance Initiative (PFI) as a source of funding, particularly for major projects. The PFI scheme [PDF, 46kb] was initiated by the government in the early 1990s, and is an approach to funding construction that you should be aware of as a governor, even if it has not yet been used in your institution.