The Committee's review of developments overseas and in other Australian jurisdictions revealed that a number of steps have been taken to improve the transparency and accountability of PPP/PFI arrangements and to demonstrate that community interests are being protected. The Committee is particularly impressed with the arrangements that apply in British Columbia where, after the financial close on all PPP projects:237
(a) a value for money disclosure report is published. This report describes the rationale, objectives and processes that led to the decision to use the PPP option. It explains how value for money was measured and how it is expected to be achieved in the context of current market conditions. It also includes a risk allocation summary and key terms on the contract;
(b) fairness and probity opinions for large projects are published; and
(c) the Auditor General reviews the value for money disclosure report prepared by Partnerships British Columbia and assesses whether the report fairly describes the context, decisions, procurement processes and results to date of the project and publishes his report.
After the agreement is finalised, the contract is published with a summary that includes the financial details and obligations of both parties.
The Committee recommends the following actions be taken to better protect the public interest:
| Recommendation 13: | That: | |
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| (a) after public private partnership contracts a signed, the contracts be published on the Partnerships Victoria website within three months; (b) a succinct (approximately three page) summary of the contract and a value for money report be prepared, modelled on the British Columbia value for money report, and include the following information: (i) the assets that are to be transferred from the Victorian Government to the private sector; (ii) the price to be paid by the government and the basis for future changes in the price; (iii) the provisions for renegotiation; (iv) the risk sharing in the construction and operational phases; (v) significant guarantees or undertakings; (vi) details of the public sector comparator. | |
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| (c) the Victorian Auditor-General review the details included in the contract summary and certify that it is an adequate reflection of the terms and conditions of the contract and arrange for the publication of the statement on the Partnerships Victoria website. | |
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| (d) the Department of Treasury and Finance develop a template outlining information to be included in the summary of the public private partnership contract and the value for money report, and advise departments. | |
| Recommendation 14: | The Victorian Government make representations to the National PPP Council to jointly fund a study on the potential financing options available to governments to fund public infrastructure projects, including the economic and social impacts of each option and publicly release the report for comment. In the event that the National PPP Council does not agree to this proposal, the Victorian Government fund such a study. | |
| Recommendation 15: | The Victorian Government: | |
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| (a) develop a secondment model within the public sector so that public officials with experience in complex procurement processes can be retained and deployed on projects across the public sector; | |
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| (b) take steps to ensure Major Projects Victoria and individual departments are appropriately resourced to manage public private partnership projects; | |
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| (c) develop individual and team procurement skills through formal qualification training; and | |
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| (d) ensure the performance criteria and targets for senior public officials involved in public private partnership projects and traditional procurement are linked to completing projects on time and within budgets. | |
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237 British Colombia, Ministry of Transportation, Project Report: Achieving Value for Money - Kicking Horse Canyon - Phase 2 Project, June 2006, see www.partnershipsbc.ca/, accessed 19 September 2006