The profile of the public partner's PPP management workforce typically comprise a mixture of permanent and temporary public servants (employees) and private sector contractors and consultants (externals) that are engaged on a fixed-term basis to augment available skill-sets. PT14 asserts that, in some cases, there is potential to improve VfM propositions e.g. through productivity efficiencies and capability building by using highly skilled contractors and consultants to fulfil specific requirements or to deal with particular issues. However, a potential risk for the public partner of relying too heavily on external contractors and consultants is that they may not adequately (or be requested to) transfer appropriate technical knowledge to public employees (PT05), nor in a timely way, which may result in the public partner paying high market rates for longer than necessary or be left unexpectedly to deal with skills-gaps if the external providers should leave suddenly. It is therefore important that the public partner develops an appropriate level of in-house expertise at an individual PPP project level to lessen the impact of such risks. Taking management of corporate knowledge as an example, PT05 opines:
"Corporate knowledge and continuity of that corporate knowledge [needs] to be maintained [better].. .the current structure within the Victorian government doesn't recognise and give enough value to that".
Apart from providing formal learning opportunities, on the job training and other types of professional development (e.g. attending contract management forums) (PT08, PT03 and PT10) for employees to improve their commercial, legal and negotiating knowledge and skills, etc (PT05, PF12, PT04, RK07 and PT03), the public partner can bolster its contract management capabilities by:
- Developing better knowledge continuity between project phases e.g. by having an operations specialist involved in procurement and delivery decision-making and for understanding the key background issues and relationships (PT04, PT10 and PF13);
- Creating and maintaining a document library for corporate and commercial documents (PT10, PF08, PT11 and PS04) e.g. through a single online repository;
- Applying the contract management / administration manual more effectively and ensuring its currency (PF13 and PT14);
- Improving succession planning (PT10 and PF07) and the hand-over process more generally, including intellectual property matters (PT12); and
- Implementing and maintaining a detailed 'calendar of deliverables' tool based on contractual outputs for monitoring performance (PF12).
Although weighted towards a compliance-orientated approach to contract management (see 'Organisational culture' above), PF12 points to the merit of using a calendar of deliverables to support junior public partner contract managers in managing tasks as specified under a concession deed. This recommendation is borne from PF12's direct experience in designing and implementing an Access database for employees to use that links each task with a corresponding delivery date - a systematic approach that also involves assessing and then reporting on the extent to which each obligation is met using a pre-defined methodology. According to PF12, such a system can easily be configured to meet the requirements of individual PPP contracts in a way that "takes users step-by-step through what they need to do, how it should be done and when to do it". Furthermore, this type of approach is beneficial for mitigating some of the knowledge and experiential risks that the public partner faces; it can be used to build corporate, commercial and project knowledge; and be used to raise levels of accountability (and performance) of both contract management team members and the private partner (PF12).
In addition to improving employee capability and knowledge within individual PPP projects, there was discussion with interviewees (PT10, PF12, PF04, PF11, PT03, PF06, RK10, PT13 and PT12) about the potential of the public sector to develop economies of scale across multiple projects. Interviewee PF11 points to a lack of curiosity and a failure of successive governments to take a long-term view of contracted PPPs including committing resources that are necessary to truly understand the commonalities that exist across projects that could ultimately improve quality outcomes and drive down recurrent expenditure. With regard to the role of the Victorian Department of Treasury and Finance under its current structure, and in relation to the operating phase, PT10 comments:
"Treasury is an absolutely critical stakeholder but are they well geared to managing or facilitating that pool, that resource, or that function? Their traditional role is being., .the source of advice around, not just budget settings, but procurement and risk. Don't confuse it with service delivery - absolutely be a stakeholder, be an owner or be a client for that but not the source or host for that type of thing".
Supporting this view, PF12, PF06 and RK10 see value in the creation of a new centralised public sector model for managing PPP business i.e. a dedicated business unit, that would, for example, manage the spectrum of agency contracts, thus making it easier to develop the requisite depth of employee knowledge and capability in a more structured and standardised way whilst reducing costs of having to rely on expensive contractors and consultants that may otherwise be paid to deliver similar requirements or deal with comparable issues across a number of projects. Although this may be a potentially effective solution in principle, there is a challenge over how such a unit would be governed, in practice. For instance, PF04 raises questions about how the unit would relate to individual departmental and statutory authority heads who have responsibility under financial management acts for activities within their portfolio and who would be given precedence in decision-making. The feasibility of such a unit could be further complicated by a lack of critical mass of PPP projects within individual Australian jurisdictions, including Victoria, meaning that there may not be sufficient skill-sets to develop and then maintain necessary expertise (PF04) due to the number of projects currently in the pipeline -unless the unit were to be established at the federal level and applied to all projects across all states and territories (PT13).
Issues relating to the locus of governance for the public partner in the operational phase of PPP, are an important finding for this research, and there is limited coverage of this topic in the extant literature.