Mitigating PPP governance challenges: lessons from eastern Australia

Abstract

Australia has been a pioneer in using public_private partnership (PPP) delivery of infrastructure for the past three decades and has accumulated a great deal of experience – both good and bad – that has helped to refine its governance regimes on both the public and the private sides of PPP delivery. This chapter reports findings from a set of interviews with all the key participants in PPP delivery about how government legislators and executive agencies currently prioritize projects professionally to avoid typical legislative parochialism in authorizing locally favored infrastructure projects, and how they organize the regulatory framework and agencies for PPP delivery. It then describes the governance regimes that have evolved for minimizing and addressing conflicts of interest and opportunistic behavior by and within the private sector concessionaires’ project companies that finance, deliver and operate PPP infrastructure services in mature Australian federal and state PPP markets. Countries considering or beginning to use infrastructure delivery can learn valuable lessons about governing this mode of infrastructure service delivery in the public interest from how Australia has adapted its governance mechanisms and safeguards for PPP delivery.