Provision of public service infrastructure – the use of PPPs in the UK and Australia : A comparative study

Purpose – The purpose of this paper is to identify key similarities and differences between the approach to employing public‐private partnerships (PPPs) for provision of infrastructure in the UK and Australia. Design/methodology/approach – The paper provides a comparison of published studies together with semi‐structured interviews with academics and state government representatives. Findings – There are a number of issues on which similar debates are taking place in both countries and which are summarised in the paper. Such issues include the use of the public sector comparators, the process of initiating PPPs, choice of discount rate and differences in costs of capital between conventional procurement and PPPs. There are, however, also significant differences in that there tends to be fewer social projects in Australia which has a strong emphasis on transportation projects. Importantly there is much more discretion about whether to use PPPs in Australia than in the UK. Research limitations/implications – There are considerably fewer schemes in Australia. Practical implications – The main practical implications are that both countries need to at least reconsider their policies in a number of areas, but particularly the issue of the higher cost of borrowing in PPPs. UK government should consider the advantages of the more flexible approach towards adopting PPPs shown in Australia. This should also mean that the evaluation process will be taken more seriously. Originality/value – There are a significant number of articles about PPPs in both the UK and Australia. The author has never come across a report of a comparative study. There are important insights that can be gained from such a comparative study.