Were risk allocations consistent with the business case?

The Department of Infrastructure (DOI) established a project team to develop a business case for the Spencer Street Station redevelopment. The business case development relied on the expertise of the DOI project team, as well as external consultants experienced in Australian and UK PPP projects.

On 28 June 2001, the final business case was submitted to the Government, so that it could make an informed decision as to whether to proceed with the redevelopment project.

Figure 3C provides an outline of the contents of the business case.

Figure 3C Spencer Street Station redevelopment business case

Source: Victorian Auditor-General's Office analysis of SCSA documents.

The key project risks were identified and an analysis of the optimal risk allocation for each of the key risks was covered by the business case. The government-preferred risk allocations were further assessed in the commercial framework summary. The summary was included with the project brief and was provided to tenderers in the request for proposal documentation.

We observed that the risks were identified with reference to the key project risks outlined in the Partnerships Victoria risk allocation guidance material. External consultants and the project team conducted workshops to identify the risks and assess the likelihood of occurrence and the possible impact on the station redevelopment.

The project team worked with legal and commercial advisors and DTF to further refine and specify the key project risks. This was reflected in the commercial framework summary document that was provided to tenderers as part of the request for proposal documentation.

A section of the station's wave roof being transported by barge during the construction phase.