Policy principles and application

Value for money is a key driver of all procurement decisions, including the use of alliance contracting for delivering and/or operating infrastructure. For complex projects with high risks that cannot be fully dimensioned, alliancing can potentially offer the best procurement strategy for achieving the government's investment objectives. The alliance approach allows such risks to be worked through collaboratively as the project develops.

The policy principles apply to all state and territory governments as well as the Australian Government in relation to the procurement of projects and/or services through alliance contracting.

The planning and implementation of all alliance contracting by all departments and public sector agencies must be consistent with the final form of the alliancing policy principles approved by their jurisdiction.4 The application of the policy principles to the alliance contracting activities of a Government Business Enterprise (or its equivalent) will be clarified by individual jurisdictions.

It is important for all agencies contemplating alliance contracting to benchmark their planning and procurement practices against the national alliancing guidance material published from time-to-time by the Commonwealth Department of Infrastructure and Transport, as well as to adhere to all other relevant government and Treasury/Finance policies and guidelines in their jurisdiction.5

Some circumstances may arise in specific projects that are unforeseen by these policy principles, and an agency may consider that the public interest is better served by varying the application of this policy or published guidelines. If this occurs, the agency should robustly analyse the departure, including any cost implications of such a variation, and seek approvals to make the suggested departure in line with section 1.3 of this policy.

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4  For convenience, the reference to 'agency' is used in this policy to mean any government-owned entity, including departments. In the alliance-contracting context, the 'agency' is commonly referred to as the Owner, although it is not appropriate to read this as a reference to the Owner Participants. 

5  This refers to all alliancing-specific guidelines published by the Commonwealth Department of Infrastructure and Transport, as well as to other government and (often) Treasury or Finance policies and guidelines that are not specific to any one procurement method, e.g., policies and guidelines pertaining to probity, Business Case development, etc.