Project Adjustment Request (PAR) changes: Town Deals, Levelling Up, and Future High Street Funds
This guidance provides details of the PAR changes we have made for these funds, giving more flexibility to councils to change projects.
We have Memorandums of Understanding (MoUs) or Heads of Terms in place across our main levelling up programmes (Town Deals, Future High Streets Fund and Levelling Up Fund) which set out the funding DLUHC is making available for specific projects. This sets out agreed funding profiles and the outputs and outcomes that will be delivered. The Department monitors delivery progress against these and gives updates to Ministers to provide assurance that delivery is progressing and value for money is being upheld.
In that context, we have change controls in place in the form of Project Adjustment Requests (PARs) across these programmes to ensure value for money in delivery against the agreed MoUs/ Heads of Terms. We recognise that in some cases decision making has been slow. To streamline and speed up delivery we are delegating more control to Accountable Bodies.
We will allow Accountable Bodies to make decisions locally (rather than referring to the Department through the PAR process) on project changes that relate to up to 30% change in funding profile and up to 30% change in output and outcomes. This is provided the project remains materially the same (see further guidance below). Changes which exceed these thresholds will need to be referred to the Department through the PAR process in the usual way. Please note that it remains the case that the Department will not be able to consider any increase to agreed funding allocations.
Non-local authority applicants to the Levelling Up Fund will need to continue to submit PARs to government for project changes in the usual way.
Process
Less than 30% change required
To expedite delivery, we are delegating decisions over project changes to Accountable Bodies within a 30% threshold as follows:
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up to 30% change to agreed project outputs and outcomes (up or down, albeit we would expect this to normally be a reduction, recognising the impact of inflation on project scope). Changes to the type of outputs are not in scope, i.e. changes from transport outputs to public realm outputs because that would be considered a material change in the type of project
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changes to project spend timetable with up to 30% flexibility between financial years
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moving money between projects within a Town Deal, Future High Street Fund programme or Levelling Up Fund bid provided (i) the change does not exceed 30% of project value (ii) the project remains good value for money as per the requirements of each fund and (iii) outputs, outcomes and spend timetable do not move by more than 30%
While we do not normally expect projects to undergo multiple amendments, there may be occasions when this is necessary. It should be noted that the 30% threshold is an accumulative metric (over the lifespan of the project) and based on the mutually agreed metrics in the MoU, Heads of Terms or Grant Offer Letter.
We expect local authorities to inform the Department that they plan to make amendments to projects in advance of any changes taking place. Accountable Bodies should provide confirmation that their Section 151/127/95/73/54 (or equivalent) officer is content that changes will still deliver value for money and that necessary local engagement has been conducted, including with the MP and Town Deal Board where the changes relate to a Town Deal.
In exceptional circumstances, HM Government may “call in” projects for review, most notably when we are made aware of local disagreement, but also when changes are novel, contentious, or potentially suggesting a material change to a project.
A material change is where a new project is proposed or where an existing project is amended significantly i.e. the outputs that are going to be delivered are fundamentally different, such as transport outputs rather than public realm outputs. This constitutes a “change of use” with there being a significant change to activity and de facto a new project being proposed.
The details of the changes under these delegated powers will be captured through respective funding programmes’ reporting processes.
In excess of 30% change being requested
In the event of changes to outputs, outcomes, delivery or financial flexibility appearing to exceed the 30% threshold the Accountable Body should inform the Department via their Area Leads.
The Department will discuss the proposed PAR with the Accountable Body and decide whether it can be dealt with under delegated power. If it is decided that departmental approval is required the PAR proforma will be issued to the local authority to complete, along with guidance of how to complete the proforma.
The Department will aim to revert with a decision within 20 working days or update the Accountable Body on progress of the PAR. This will not be from the point of submission but from the point the Department has triaged the form and confirmed no further information is required from the Accountable Body before the PAR is assessed.
DLUHC (and DfT for Levelling Up Fund projects) will ensure adjustments are reflected in future MoUs and grant funding agreements.