Public Private Partnerships: The Provision of Social Infrastructure in Australia

Recent trends in the provision of infrastructure indicate that the private sector is playing an increasingly important role in the procurement process. Australian governments are turning to the private sector to form partnerships in the finance, construction, ownership and operation of social infrastructure projects. This has become a major challenge and the emergence of Public-Private Sector Partnerships (PPPs) provides a means for developing the infrastructure without directly impacting upon the governments budgetary constraints. Social infrastructure projects (school, hospitals, prison etc) are characterised as generally being smaller in scale than economic infrastructure (motorways, bridges, tunnels etc.)However, by their very nature, social infrastructure PPPs are often presented with a situation where operational involvement with the community. Thus private sector bidders for social infrastructure PPS are as attractive for social infrastructure compared with economic infrastructure. The paper discusses the additional costs likely to be incurred in the bidding process for social infrastructure PPPs. The results are presented from a Private Sector point of view.