Colin Duffield - Australian APEC Study Centre

APEC Workshop
Establishing, maintaining and utilisation of a data
base
Associate Professor Colin Duffield
10 February 2010

Outline / Introduction
1. Databases and their purpose
a) Interest
b) Market understanding – activity
c) Harmonisation of approaches – lower prices and less delays due to
consistency
d) Identification of potential opportunities
e) Policy and practice enhancement
2. Some examples
a) Europe
b) Australia
c) India
d) Researchers
3. Issues
4. Reality check

Example
European
data
[source European PPP
Report 2009 – EPEC]

Infrastructure Australia
[source
www.infrastructureaustr
aslia.gov.au Feb 2010]

[source
www.infrastructureaustr
aslia.gov.au Feb 2010]

[source Linking
Melbourne Authority,
Feb 2010]
Details:
- Transparent
- In depth
- Across all project
areas

Indian database
Eg Report 1 Eg Report 2

Data Capture
Requested data
Project number
Description
Project name
Project delivery method
Project description
Including details of the form of the project contract, e.g. managing
contractor, head contracts, design and construct, public private
partnership
Including brief details of the scope and objective of the project
Project costs
Including details of cost estimates at the various stages of procurement
and actual project costs or forecast of final cost; include a break down in
terms of operating and capital costs. Please record data in nominal
dollars.
Project cost details
Project risk allocation
Brief reasons for any variance and inflation assumptions and the Public
Sector Comparator (PSC) nominal discount rate used.
Details of the risk allocation between parties of the design and/or
construction risk, ownership risk, operational risk, residual value risk.
Standard forms were developed to clearly represent this data. Any
additional explanation or comments regarding these risks was also
requested.

Data Capture cont…
Requested data
Project timeline
Description
Details of estimates at the various stages of procurement for project
duration, important milestones and forecast completion dates. Standard
forms were developed to clearly represent this data. Brief reasons for
deadlines not being achieved were also requested.
Project outcome
Specific outcome (metrics)
Details of the whether project objectives were [are likely to be] achieved,
including any reduction or increase in scope; provide reasons for
objectives not being achieved; include value for money measured as a
percentage of the PSC*; include results of any post-project benefits
assessment that may have taken place if the project has been completed;
include relevant quantitative data for all projects to support project
outcomes where available
Metrics of project outcomes were requested, Eg.: PSC = $100m; Contract
NPV (forecast/actual) = $90; VFM = $10m; VFM % of PSC = 10%

Methodology - periods
• Full Period: $
• Government as well as
PPP/TP affect this
• Stage 3:
• Mostly influenced by PPP
consortium/TP contractor
Original
approval
Final
budget
Contractual
commitment
Actual
final
TIME
(MILESTONES)
FULL PERIOD
STAGE 1
STAGE 2
STAGE 3

Methodology - periods
• Full Period: $
• Government as well as
PPP/TP affect this
• Stage 3:
• Mostly influenced by PPP
consortium/TP contractor
Original
approval
Final
budget
Contractual
commitment
Actual
final
TIME
(MILESTONES)
FULL PERIOD
STAGE 1
STAGE 2
STAGE 3

Construction cost over-runs
Total Cost of Traditional & PPP Projects ($M)
Expected
Cost
Net Cost
Over-run
Final
Cost
% Cost
Over-run
Full Period
Original Approval -
Final
Tradition
al
PPP
3,082.0
4,484.4
1,087.6
519.3
4,169.6
5,003.7
35.3%
11.6%
Stage 3:
Contract - Final
Tradition
al
PPP
4,532.6 672.5 5,205.1 14.8%
4,946.1 57.6 5,003.7 12% 1.2%
Source: ACG/University of Melbourne

Cost performance over project initiation
and delivery (source: VFM report 2009)

Time performance over project initiation
and delivery (source: Duffield 2008)
20
Time Performance (based on averages)
15
% La ater than anticip pated
10
5
0
% Earlier r than
antici pated
-5
-10
Original
Announcement
Budget
approval
Contractual
commitment
Actual
Final
Project Milestones PPP Traditional

Issues associated with data collection
1. Confidentiality – commercially sensitive
2. Contractual limitations on sharing of commercial details
3. Dynamic environment means data changes as a project
progresses – what perspective is being sought
4. Different perspectives for different audiences
5. Timing of the release of data is critical
6. Data management is difficult and data can be either incorrect,
dated or misleading if not adequately controlled

Reality check
What may be practical for a generic APEC database
• Database for:
a) Interest Achievable
b) Market understanding – activity Achievable
c) Harmonisation of approaches –
detailed learning
d) Identification of potential
opportunities
e) Policy and practice enhancement Unlikely
Is a database that achieves points a) & b) (potentially with some mis-
) ) ( y
information) worthwhile

Reference to benchmarking studies:
Wood, P. and Duffield, CF 2009, In Pursuit of Additional Value: A
benchmarking study into alliancing in the Australian Public Sector.
Melbourne, Department of Treasury and Finance, State of Victoria.
[www.dtf.vic.gov.au… project-alliancing]
Duffield, CF 2008, National PPP Forum – Benchmarking Study, Phase II:
Report on the performance of PPP projects in Australia when
compared with a representative sample of traditionally procured
infrastructure projects, Report to the PPP Forum by the Melbourne
Engineering Research Institute, 15 November: 44,
http://repository.unimelb.edu.au/10187/3148.
Allen Consulting Group, Duffield, CF and Raisbeck, P 2007,
‘Performance of PPPs and Traditional Procurement in Australia’,
Melbourne, Infrastructure Partnerships Australia: 57.

A/Prof Colin Duffield
colinfd@unimelb.edu.au
© Copyright The University of Melbourne 2007 cricos code 00116K