Out-Law Analysis | 03 May 2018 | 9:46 am | 2 min. read
The solid and broad investments in both transport and social infrastructure contained in the budget are being seen by many in the Australian infrastructure sector as an indication of what we might expect to see in other state budgets, as they get announced in the lead up to elections.
The Victorian government has been able to make funding allocations to infrastructure that might not otherwise have been available, thanks to a combination of Commonwealth government contributions and effective use of the proceeds from asset management sales, including the proceeds of the Snowy Hydro sale and the commercialisation of Land Use Victoria's land titles and registry functions.
Renewed interest in PPPs
The budget indicates a renewed interest in public-private partnerships (PPPs), after few greenfield PPP projects came to market in 2017.
Of particular significance are:
There may also be the opportunity for other healthcare PPPs in addition to the above. For example, although funding has not yet been confirmed for Footscray Hospital, the project appears to have been accounted for in the budget estimates.
The expansion and redevelopment of the Ballarat Base Hospital and the Footscray Hospital could be opportunities for the Victorian government to 'road test' its newly-released Partnerships Victoria PPP project documents for social infrastructure and see if they deliver on their objectives of reducing bid costs, improving services and promoting innovative and value for money solutions.
In another innovative move, the Western package of the Suburban Roads Upgrade project, procured in 2017, is the first time that an availability charge system has been used for artillery roads PPP in Australia.
Investment in transport and social infrastructure
In addition to the Suburban Roads Upgrade packages and North East Link, significant transportation investments include:
The budget's commitment to social infrastructure is clear from its investments in health, justice and education. AU$1.3bn has been committed to each of the health and education sectors, and AU$769m has been committed to investment in the justice sector.
In addition to the Ballarat Base Hospital development, significant social infrastructure investments include:
Melanie Harwood is an infrastructure law expert at Pinsent Masons, the law firm behind Out-Law.com.