Private sector funding in public infrastructure in Victoria has been used since the1990s (Parliament of Victoria Public Accounts and Estimates Committee 2003: p.6) (e.g. Victorian Railways (V/Line)) and the State has had a PPP program in place for more than 20 years (The World Bank 2007: p.51). Only more recently, since 2000 (Partnerships Victoria 2006a: p.4), has Partnerships Victoria, a dedicated unit within the Department of Treasury and Finance, been responsible for the procurement and delivery of PPP.
The period between the early 1990s and the end of that decade included the delivery of CityLink, and like other PPP of that time, was characterised by an increase in private sector involvement in public infrastructure due to (an unsubstantiated) belief that competitive spirit, fostered within the private sector, could lead to the delivery of more efficient and effective services (Maguire and Malinovitch 2004). Although there are similarities prior to, and post 2000 in terms of process / procedures (Partnerships Victoria 2006a: p.5), there are also key differences. Maguire and Malinovitch (2004) state that PPP of this earlier era was synonymous, for instance, with high levels of risk transfer, payments being withheld until service delivery commenced, no government guarantee on returns and limited benchmarking activity (some of these claims are backed-up by the Parliament of Victoria Public Accounts and Estimates Committee (2003: p.8)). The formation of Partnerships Victoria has led to a greater emphasis on Government managing core services i.e. the physical delivery of public services (such as clinical health services), the introduction of the PSC, contract management and the standardisation of commercial principles (Partnerships Victoria 2006a: p.5).