Where a proposal is from an incumbent (or a member of a) PPP Consortium to vary an existing concession, which may or may not include related new or modified infrastructure, the Responsible Agency and proponent must comply with the existing PPP contract (where relevant), these NSW PPP Guidelines and TC15-16: Managing Public Private Partnership (PPP) Contracts. This is the case, irrespective of whether the existing PPP contract documents contain specific modification or variation clauses.
For such variations, the Responsible Agency does not need to comply with the NSW Unsolicited Proposal Guide given it is in essence a variation of an existing PPP.
In particular, a proposal to materially vary an existing PPP contract will require consultation with NSW Treasury and relevant Cabinet approvals prior to:
■ entering direct negotiations with a proponent;
■ signing any Memorandum of Understanding or Heads of Agreement;
■ materially changing any commercial terms previously approved by Cabinet; and
■ signing Amending Deed(s).
In addition, the Responsible Agency, in consultation with NSW Treasury, must:
■ establish an appropriate PPP Governance Framework at the outset; and
■ assess the proposal, at least, against the Minimum criteria for Evaluating Commercial or Contractual Change as set out in TC15-16, being:
- value for money;
- the benefits and costs of the changes to Government and the private party;
- impact on the State Budget and project affordability;
- the impact on the allocation and management of risks and avoiding creating an undesirable precedent;
- continuing viability of the project; and
- external market forces.