The Australian PPP market is already among the most sophisticated PPP markets in the world, but continues to improve and evolve. It can be characterised by the following phases of development that are distinguished by the types of project undertaken:
1. An initial phase in which project finance techniques and instruments are developed for BOT and BOOT projects that were adapted to build transport infrastructure. Most of these projects were contracted in the market up to 2000, and completed in recent years. A number of the evaluations of the efficiency of Australia's PPP market are based on these projects.
2. The focus of the present study, however, is the second phase of development in this market, which is now underway. Social infrastructure projects are beginning to widen their dominance of the market in numerical terms. These projects are diverse and include hospitals and schools involving significant facilities management over the economic life of the asset. We expect this market to continue to develop, and for PPPs to also continue to engage in the ongoing operation of water and energy infrastructure related to Australia's future sustainability needs.
There have been several reviews of the Australian PPP market that have sought to define what PPPs are, and to monitor the growth of this form of public procurement (e.g. Malone (2005), Hodge (2005)). In this chapter we provide a review of the evolution of the market and a snapshot of its current state.