ISSUES AND STRATEGIES

•  Public Acceptance of TollingCityLink is Melbourne's first privately owned toll road. Prior to CityLink, the Government-owned West Gate Bridge was tolled. However, the toll charges were subsequently removed after public pressure.

•  Non-Compete ClauseTransurban accepted construction, revenue, and residual risks while the Victorian Government committed to avoid developing or improving potential competing road and public transit links.

•  Implementation ProblemsPPP arrangements are long term and as such, governments need to be prepared to deal with problems with the operator. A number of operational problems initially plagued this innovative project, including:

-  Changes in toll charges;

-  Incorrect charging;

-  Failure of electronic tag transponders used to pay tolls; and

-  Treatment of tag-less toll road users.

All of these problems required various degrees of Government intervention to resolve.

•  Revenue SharingRoad links feeding into toll roads have the potential to provide incumbent toll operators with additional revenue. Clauses within the PPP arrangement provide for a revenue-sharing arrangement between the Victorian State Government and Transurban following any network improvements.