Responsibility for project costs and risks

The government has a responsibility to the community to seek to achieve best value from the expenditure of public funds in the delivery of public infrastructure.

In such circumstances, government cannot deal exclusively with an unsolicited proposal under which government is required to accept any project risks and/or costs or to make service and/or facility payments to the private sector party.

Where it is not feasible for the private sector party to bear a particular commercial risk, government is to be fully indemnified by the private sector party (in a manner satisfactory to government) against the financial consequences of that risk occurring.

Any unsolicited proposal seeking to place any non-indemnified risks, costs or payment obligations on government must, if pursued, be subjected to a competitive bidding process to ensure that it represents a value for money outcome for government.