RIGOROUS analysis of public and private investment options is critical to assessing the appeal of public private partnerships in delivering vital infrastructure, Western Australia’s top Treasury bureaucrat has told a state parliamentary committee.
In recent weeks, the minority-dominated Public Accounts Committee has been probing state bureaucrats over the Barnett government’s infrastructure investment program.
With the premier strongly advocating greater use of PPPs to deliver major projects such as the Midland Health Campus, state under-treasurer Tim Marney was last week summoned to explain Treasury’s role in determining the government’s funding priorities.
Asked whether major projects, such as the taxpayer-assisted Oakajee port development, were always subject to detailed cost-benefit analysis before government funds were committed, Mr Marney conceded that was “not always feasible”.
He added that in some instances “importance to government … is a significant factor” in determining infrastructure investment priorities.
Asked whether Treasury’s role was therefore generally restricted to advising how to deliver a project rather than if it should proceed, Mr Marney conceded “that is often the case”.
However, he stressed that Treasury always made its view known if it believed that a particular decision was not in the public interest.
Quizzed about whether Treasury had been asked to offer advice on Oakajee before the state government pledged up to $678 million in taxpayer funding, Mr Marney said it had been asked to provide advice on Oakajee “at various times”, and that direct involvement in the proposed port “was a clearly articulated outcome that government wanted to achieve”.
Mr Marney denied that PPPs were, therefore, inevitable for projects such as the Midland Health Campus, saying Treasury would still have a fundamental role in determining whether such projects were undertaken by government or as a PPP.
A critical part of that process was a comparative analysis of what such projects would cost to build and operate in both public and private hands, he said.
"Otherwise how would you know if it's a good deal?" Mr Marney said.
