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Maintenance flexibility has been promoted as a value driver for long-term public–private partnerships (PPPs). However, the value and risk associated with this value driver have not been properly quantified in the Value for Money (VfM) assessment literature. To bridge the gap, a novel stochastic modelling methodology is proposed to characterize the complex interactions among the lifecycle cost (LCC), performance deterioration and maintenance strategies. Four different maintenance strategies are designed to emulate the practice in the traditional and PPP delivery methods. The LCC includes the direct maintenance cost, user cost, residual value, and payment deduction, the last three often being neglected in VfM assessments. Simulation-based optimization and dynamic programming analysis are used to determine the probability distributions of the LCC and the VfM. A hypothetical highway PPP project under an availability payment model is selected as a case study. The results show that maintenance flexibility is indeed able to reduce the LCC for the private party. However, this private efficiency, if not properly regulated, could cause a reduced asset residual value and an increased user cost, making the public party worse off. In addition, for all potential maintenance strategies, the public sector is found to retain significant lifecycle cost risk, largely in the form of user cost. [ABSTRACT FROM AUTHOR]

The research explored the approaches used by government agencies (as client organizations) to drive occupational health and safety (OHS) performance improvements in publicly funded infrastructure construction projects in Australia. Semi-structured interviews were conducted with 32 representatives of clients and contractors with direct and recent experience of delivering large public infrastructure projects. Interviews explored the procurement approaches taken, and the use of incentives and performance measurement. Data was subjected to inductive analysis to identify emergent concepts and themes relating to the way that New Public Management (NPM) influences the commercial management of infrastructure construction projects, with particular reference to OHS impacts. The concept of institutional logics was utilised as a theoretical frame to understand clients' behaviour in the commercial management of infrastructure projects. Client behaviour was consistent with elements of NPM and reflected a managerialist logic in the pursuit of efficiency, the use of targets, incentives and performance measurement. However, a strong professional service logic was also found to drive active client behaviour in relation to the management of OHS. Understanding the institutional logics driving client OHS practices is an important theoretical development that can stimulate reflexive practice which may create an impetus for change. [ABSTRACT FROM AUTHOR]

Achieving good value for money (VFM) is the principal objective of any private finance initiative (PFI) project while sustaining it throughout the contract life is the greatest challenge. Empirical evidence is required to understand uncertainties surrounding VFM of PFI before finding effective ways to improve it. Variations in costs, time and client requirements are explored, between successive review stages of PFI projects from the strategic business case stage through to the operational phase. The magnitudes of these variations are established and critical parameters that influence them are identified. The research methods include a documentary analysis of the full business cases of five PFI projects and a questionnaire survey of 44 PFI projects from the healthcare and transport sectors in the UK. The findings reveal that the current VFM assessment of PFI projects is often carried out under conditions of considerable uncertainty with frequent changes in costs, timescales and client requirements. The list of critical parameters can help practitioners to identify priority areas and achieve a long-lasting VFM. The study broadens the understanding of whole life aspects of VFM of PFI projects and the interactivity of project parameters at different stages. [ABSTRACT FROM AUTHOR]

Public-private partnerships (PPPs) have been applied widely in the global construction market. During the life cycle of PPP projects, their performance could be affected by a number of factors and their interactions, which might cause the inefficiency and ineffectiveness of the projects. Previous researches on PPPs mainly concentrated on the procurement, success measurement and risk management of PPPs, but paid little attention to the process factors that can strongly influence the performance of PPPs. In order to improve process and performance management in PPPs, the performance objectives and key performance indicators (KPIs) are identified to improve the partnership outcomes. Based on the goal-setting theory, 15 performance objectives are selected. The relative significance and difference of performance objectives for different stakeholders are presented based on a structured questionnaire survey. The survey results show that all identified objectives are important. In spite of stakeholders' common opinions on the objectives of quality, costs, time and the services provided by PPPs, there are evident differences in the objectives of budget constraints of the public sector, risks, revenue and guarantees. According to the survey results, a conceptual KPIs framework is established. Furthermore, the KPIs are identified to assess PPP projects' performance. The performance objectives and the KPIs, which can be used to identify the strengths and weaknesses of PPP projects, are useful tools for effective project performance management in PPPs. [ABSTRACT FROM AUTHOR]

This paper reports the outcome of an investigation into the construction costs in 11 motorway projects. The projects formed one length of road and were of identical specification; five of the projects were undertaken by a traditional design, tender, construct method, and five were undertaken by a procurement system by which the contractor bid a lump sum for the work and so absorbed potential risks and benefits from changes in prices of resources or fluctuations in quantities of work necessary for the completion of the work. One project was undertaken by a design and build method. The results of the analysis indicate that in roadworks the construction cost per kilometre of road is some 11% less expensive when lump sum contracts are used. This benefit appears to be more pronounced in the case of bridge structures incorporated into the motorway. Of greater significance is the cost certainty that is afforded using the lump sum methods. The research showed that lump sum projects were much more likely to be completed within the budget. Finally the lump sum methods required less management by the client organization and delivered more harmonious working relationships between the client and contractor. [ABSTRACT FROM AUTHOR]

The wherewithal of achieving best value in private finance initiative (PFI) projects and the associated problems therein are documented. In the UK, PFI has offered a solution to the problem of securing necessary investment at a time of severe public expenditure restraint. In PFI schemes, the public sector clients must secure value for money, while the private sector service providers must genuinely assume responsibility for project risks. A broad-based investigation into PFI risk management informs the discussion in this paper. It is based on 68 interviews with PFI participants and a case study of eight PFI projects. The research participants comprised of contractors, financial institutions, public sector clients, consultants and facilities management organizations. The qualitative software Atlas.ti was used to analyse the textual data generated. The analysis showed that the achievement of best value requirements through PFI should hinge on: detailed risk analysis and appropriate risk allocation, drive for faster project completion, curtailment in project cost escalation, encouragement of innovation in project development, and maintenance cost being adequately accounted for. Factors that continue to challenge the achievement of best value are: high cost of the PFI procurement process, lengthy and complex negotiations, difficulty in specifying the quality of service, pricing of facility management services, potential conflicts of interests among those involved in the procurement, and the public sector clients' inability to manage consultants. [ABSTRACT FROM AUTHOR]