Relevant generic issues arising from this case study are:
- Management commitment and support. 'Duplication' of services can be costly. Responsibilities of PPP operators should be adequately defined under service delivery agreements, particularly in circumstances where there is potential for overlap with support services delivered out-with the scope of PPP service agreements (i.e. other service arrangements implemented by government).
- Clear and open communication. If contractual responsibilities are not clearly articulated between key public partner employees and service providers, there may be potential for misunderstanding that could impact upon the effective use of resourcing and detract from the achievement of VfM outcomes.
- Contract variation. VfM achievement can be put at risk if public partners do not take timely and / or decisive action to manage service provider under-performance. Such situations may arise, for instance, due to the length of time it may take the public partner to investigate complaints or because business continuity plans are not sufficiently developed to address the issues faced. This may lead customers to seek out alternative services that are provided by 'competitor' organisations (therefore impacting on the attainment of project objectives and the use of tax payer funds).
- - Change of consortium members / change to public partner's agency authority. Sub-standard delivery of services or the failure to provide agreed services by a member of a private consortium may lead to its contract being terminated. Such situations, for example, may lead to the replacement of that member within the existing consortium or an amended contract if the provision of those services is no longer required.
- Reputation damage. Sensitive financial and commercial information relating to PPPs such as cost structures, profit margins and intellectual property tend to be protected by 'commercial in confidence' arrangements. This can lead to criticism by public commentators who may accuse government, for example, of 'dodgy deals' whereby the private partner profits at the expense of tax payers or service users.
- Contract management. If public partners do not provide sufficient oversight of the currency of service provider operations manuals, service delivery standards may be compromised. Oversight should include regular review of documentation including asset management plans, operation plans, maintenance programs and environmental management plans. Regular benchmarking exercises / competitive market testing should also take place to establish the relative quality and competitiveness of the services being provided.
- Penalties and abatements. Public partners may not reap intended VfM outcomes if it does not consistently apply abatement for under-performance (particularly when viewed over the long-term - service contracts can last for 20 years or more). Deductions should be applied (depending on specific circumstances) for reporting failures, unavailability / partial unavailability of services and not addressing issues that give rise to occupational health and safety risks.