Learning from the New South Wales Government Action Plan
Published March 10, 2021
IMAGE CREDIT: Stephen Bridger / Shutterstock.com
The New South Wales Government established the NSW Government Action Plan: A ten-point commitment to the construction sector in 2018. It is the foundation of a concerted effort to strengthen the relationship between the government and private sector to drive better project outcomes.
The Future of Infrastructure Group convened a group of experts to share their perspectives on how their initiatives are driving change in the market.
Takeaways
- Engagement across government: New South Wales has established the Construction Leadership Group made up of government departments and agencies responsible for delivering infrastructure. The leaders of each agency meet monthly and report on progress against the 10 Point Commitment, but coordination is constant through working groups and one-on-one engagement with Infrastructure NSW with a focus on continuous improvement.
- Engagement with industry: NSW recognized the importance of genuine engagement and consultation with industry with a view to listening to problems on an ongoing basis and ensuring industry sees input reflected in actions. This includes on a project level where there is early engagement and open discussion on how to share risk, how to package projects and mitigate risk rather than pass it on, as well as using interactive procurement processes.
- Whole of government project pipeline: One of the best received initiatives was to regularly publish a forward view of all upcoming government projects. This both helped industry plan and balance resources and helped link land use and infrastructure by enhancing collaboration between government departments, for example linking transport and precinct development.
- Avoiding premature project commitments: NSW found premature project announcements had major adverse project impacts and undermined public trust in both government and industry. NSW has developed a staged process for announcements that provides incremental detail as the project goes from political commitment to being ready for service.
- Focus on major projects: The NSW Premier released guidance through the Memorandum of Procurement for Large, Complex Infrastructure Projects that lays out how all the largest projects should be managed from de-risking to the procurement approach, to reducing tender costs. Any department or agency is required to comply with an “if not, why not?” approach if they do not follow the process, with exceptions reported.
- Focus on outcomes: There is a shift away from measuring inputs and outputs for projects to outcomes to show the customer benefit. Transport for NSW uses a Customer Satisfaction Index which surveys 23,000 customers across all transport modes from public transit, to cars, freight, and pedestrians. It provides a common point of reference and shows trends across the department, driving accountability around continual improvement.
- Measuring performance: NSW collects performance data which is shared across agencies to see themes developing and as a basis to have conversations with contractors. Then, industry provides ratings to government to help delivery agencies improve. On Sydney Metro there is a two-way performance loop which helps indicate where there might be problems. This behaviour-based tool can help resolve issues through conversations early before it becomes a dispute.
- Reducing tender costs: To encourage bidders and make the process more efficient, NSW has reduced the document requirements and in particular, the amount of low value duplication of information, worked to maintain a maximum of three bidders shortlisted and cutting those out early who are unlikely to win, standardizing the documents, providing a streamlined prequalification process for companies with a proven track record of successful delivery.
- Better project packaging: NSW has started tackling some of the more common and uncertain risks such as geotechnical conditions, utilities and contamination through early works. Packaging allows companies to take on risks they are most suited to handle and provides different sized opportunities for companies of different sizes and capabilities to bid on. Although this does provide greater interface risks which need to be managed.
- Balancing value: NSW is engaging with industry to help determine value for money with an emphasis on balancing policy outcomes, such as skills development and environmental performance, and enabling industry to be profitable. The state has been exploring ways to incorporate these goals into procurement processes to reward bidders with plans that demonstrate a wider societal impact over the project lifecycle.
