Public private partnerships: an exploratory study in health care

Public private partnerships (PPPs) are a relatively new policy that some governments now use to secure infrastructure assets. The objective of this paper is to document the construction and development of a Victorian state government hospital, Casey Hospital (CH), to identify the essential features of this contract and the relationship between the government and the private sector provider.

A case study approach is employed. The boundaries of the CH case study are limited to the identification of the service or program that was/is subjected to PPP, the reasons for adopting the PPP policy in this instance and what the criteria were that led to a successful/unsuccessful outcome for this project. Data collection methods included interviews with key participants and analysis of archival documentation.

The findings suggest that clear outcomes as specified in the contract specifications, previous experience in the hospital sector and a willingness to be flexible were key factors that resulted in a successful outcome. The government defines success for PPP projects as being built on time and within budget.

Given that governments in Australia and in many developed countries worldwide have now accepted the procurement model known as public private partnerships, further research is required to ensure that future projects meet defined objectives. This study provides an analysis of one case study and further research needs to be carried out for a thorough assessment of this policy.

Casey Hospital was the first hospital in Australia to be constructed and its ancillary facilities operated under the auspices of a PPP policy. This study is significant as public sector managers can use the findings of this report to help inform future decision making with respect to PPP projects.