Sustainable procurement: a contemporary view on Australian public private partnerships (PPP)

The last two decades have seen the evolution of Public Private Partnerships (PPPs) as an alternative procurement method to traditional methods of delivering public infrastructure. Gaining significant popularity in the UK during the 1990’s PPPs have gradually spread worldwide to become an accepted approach to infrastructure provision. In Australia, there would appear to be considerable growth potential for PPPs given that both the New South Wales and Victorian State Governments have recently developed policies to expand the application of PPPs to include social infrastructure, such as hospitals and schools. This growth potential has lead to an ongoing debate on the nature of the bid requirements for social infrastructure PPPs, particularly in terms of the cost of bid preparation. This paper maps the historical development of PPPs in Australia and describes a recently commenced research project which is investigating current approaches to the identification and allocation of risks during the bidding process of social PPPs with particular reference to the legal and financial (i.e. transaction) aspects. The primary objective of this research is to improve the process of risk identification and risk allocation for Public and Private Sector stakeholders in PPP bidding with the ultimate goal of minimising the transaction costs of the bidding process.