Amendments for example, can arise from technical obsolescence, new legal requirements, changes in service user demand, service provider under-performance (Partnerships Victoria 2001: p.135, p.161; Edwards et al 2004: p.122) and from decisions to modify the length of agreements. Government has the right to step-in if the quality of services provided by the operator fails to meet its obligations (Partnerships Victoria 2001: p.161) which could arise from a breach of contract such as default or due to an emergency situation where circumstances may be beyond the capability of consortia to deal with the situation effectively (Partnerships Victoria 2001: p.148, p.161). See Table 6.13 for identified sub-issues and case study examples.
Table 6.13 Sub-issues Arising From Contract Variation.
Sub-issues | Generic case study findings |
- Modification of existing services - Re-allocation of risk - Business continuity planning modification | - Force majeure events have the potential to critically impact upon the service provider's ability to perform its contractual obligations - New legal requirements may lead to existing agreements being varied. VfM outcomes may be reduced if variations are not based on clearly defined benefits, properly justified costs / needs analyses, or assessments to determine consortia capability - VfM achievement can be put at risk if the public partner does not take timely and decisive action to manage service provider under-performance |