PPP debate stacked in favour of private sector

NZ’s Finance Minister is spot on when he says we need to learn from the Australian experience of Public Private Partnerships (PPPs) - why New Zealand should steer well clear, said Green Party Co-Leader Dr Russel Norman today.

This morning Mr English called for a ‘more sophisticated debate’ about the use of PPPs as well as explaining how Treasury’s newly created National Infrastructure Unit would be producing a national infrastructure plan that would be ready before the end of the year.

“Private companies involved in PPPs in Australia have on numerous occasions underbid, overpromised and under-delivered,” said Dr Norman.

“Private firms time and time again in Australia have aimed to minimise their financial risks – at the public’s expense. Many times when project budgets have been miscalculated the Aussie taxpayer has come to the rescue.

“But when a windfall profit has been made the private company has unsurprisingly not distributed any largesse to the Australian taxpayer.

“The first aim of a private company is to make as much profit as possible from engaging in a PPP – not to engage in large scale risky projects for the good of society.”

“Any debate Mr English wants to have about PPPs is likely miss this salient fact given the one-sided make-up of the Board tasked with advising Treasury on infrastructure development.”

In May the Government announced a National Infrastructure Advisory Board ‘consisting of members from the private sector’ to advise Treasury and the Minister for Infrastructure (Bill English). The group includes Business Roundtable chair Rob McLeod along with a number of players in the engineering and construction industries.

“As with a number of advisory boards set-up to assist the current Government the membership consists of those with a vested interest in one particular outcome,” said Dr Norman.

“It is a wonder the Business Roundtable ever finds time to meet given the number of advisory boards their chair Rob McLeod has been appointed to by Bill English – which is I suppose one plus.”

Link to the membership of the National Infrastructure Board

http://www.infrastructure.govt.nz/advisoryboard

Link to the Australian Institute of Project Management release on PPPs

http://www.aipm.com.au/html/media_release_public_private_partnership_ppp_projects.cfm