Infrastructure Engineering - Theses
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ItemEnhanced value for money outcomes through alliance techniques: a framework for public private partnerships in Australia( 2007)While much of Australia's current infrastructure has been traditionally provided by the public sector, there is a recent trend towards private organisations providing infrastructure services. Governments have realised that to maintain economic competitiveness along with social cohesion, the value of private finance within infrastructure development can not be understated, whereby the private sector invests in infrastructure and provides related services to the public sector at a reasonable cost. Whilst there are a multitude of variations, this concept is commonly known as a Public Private Partnership (PPP). Recent Public Private Partnership projects in the developed world have focussed heavily on achieving Value for Money (VfM) outcomes for governments through the application of robust polices and guidelines. This study has investigated current Australian PPP policies (both State and Federal) to determine whether enhanced Value for Money outcomes can be achieved through the integration of Alliance techniques. Value for Money in a theoretical sense is defined as the functional performance achieved for a given consumption of resources. The actual quantum of Value for Money calculated is not important; the focus being on the relativity between the traditional PPP model and a model that utilises Alliance techniques. Specific techniques and perceptions of Alliance Contracting were investigated through a series of surveys with direct users from both the public and private sectors, and the level of applicability to a PPP process was established. A detailed review of Australian and UK PPP projects was undertaken and a series of in depth case studies were investigated to better understand the practical implications and the current shortcomings in current PPP policy approaches. The framework for a new approach was developed and further tested and refined through an industry workshop with key PPP representatives from a variety of sectors. The study concludes with drafting new guidelines for PPP projects, to enhance Value for Money outcomes for all parties. Whilst it was found that not all Alliance techniques would enhance Value for Money outcomes, a number of key areas were identified where improvements could be made to current practices, namely: • Development of policies to mandate interaction between the State, bidders and end users at critical stages of PPP projects. Proposed enhancements to the current PPP policy model have been developed, including: • Incorporation of relationship based Alliancing techniques to assist with the complex and varied contractual nature of a PPP project; • A credit based abatement regime which incentivises parties to outperform specific outputs in the form of credits which can then be used against underperforming areas; and • The appointment of an Independent Reviewer to oversee the long term management of the contract.