duffield institutions and better infrastructure 2
TRANSCRIPT
Toward a new multi-partner Indonesian
infrastructure institute
Institutions and better
infrastructure
Dr Colin Duffield
Agenda
1. Objective
2. Involvement in projects and Indonesia
3. Global infrastructure outcomes
4. Model of successes and reality
5. Best practice thinking – the depth of the business proposition for investment
6. Concluding remarks
Objectives
We seek to answer the following high level questions:
1. Can an independent infrastructure institute assist in overcoming Indonesia’s infrastructure issues?
2. Is now the time to establish such an institute?
3. What tasks would such an institute undertaken and what authority would it have?
What sort of infrastructure are we talking about?
Shaping Infrastructure - Major roads - Ports - Freight routes - Planning and land use plans, including
industrial hubs - Energy grid - Choice of strategic infrastructure
technology, e.g. telecommunications
Following Infrastructure - Arterial roads - Hospitals - Schools - etc
Characterised as complex and requires integration with other services.
Best optimised by responsible Departments and delivery Agencies
International approaches
Country approach Leadership and thought leadership
Underpinning driver Comments
Control – Centralised planning
Central Agency – input from specialists as required
Master plan Requires strong leadership and authority
Strategic direction (e.g. decrees, policy, frameworks, guidance
Involvement from all key stakeholders to identify and optimise investments
Value for money investment in a timely manner
Requires complex process and procedures that facilitate innovation
Market driven Company initiated – typically focused only at project level
Profit Potential of monopolistic outcomes due to IP protection
China
US
AUS
EU
Conceptual models for infrastructure planning
EU decisions
Working parties
Country input
Research actions Local decision
(including expert advice)
Concept, engagement
Funding policy
Local legislation
Governmental decisions
Departmental Agency …….
Advisory (non-political)
Indonesian process
Project level complexity
Complexity of finance
NZ approach
A reference/advisory group provides technical and other advice to the project team as required.
“The Quality Team”
Members of the reference/advisory group have specific expertise that may not be required on a full-time basis and is called on as needed.
• Management of quality plan
• Setting the quality standards
• Audit of the deliverables as required
NZ: Note programme group and advisory group
Appraisal and Evaluation in Central Government (UK)
• The purpose of the UK Treasury Green Book is to ensure that no
policy, programme or project is adopted
• without first having the answer to these questions:
• ❑ Are there better ways to achieve this objective?
• ❑ Are there better uses for these resources?
Infrastructure Australia
Infrastructure Australia advises governments, investors and infrastructure
owners on a wide range of issues. These include:
• Australia's current and future infrastructure needs mechanisms for financing
infrastructure investments, and policy, pricing and regulation and their
impacts on investment and on the efficiency of the delivery, operation and
use of national infrastructure networks.
• Infrastructure Australia's focus is on assisting Australian governments to
develop a strategic blueprint for unlocking infrastructure bottlenecks and to
modernise the nation's economic infrastructure.
• Infrastructure Australia reports regularly to the Council of Australian
Governments through the Federal Minister for Infrastructure and Transport.
The General
Australian PPP
process
Investment Lifecycle
Direction
• Service strategy
• Asset strategy
Concept & feasibility
• Strategy assessment
• Options analysis
• Problem definition
• Solution definition
• Benefit definition
Validation & planning
• Business case
• Procurement strategy
Implementation
• Planning & scheduling
• Delivery
• Contract Management
• Asset reporting
Operation
• Functional operation
• Maintenance
• Disposal
• Benefit reports
Better business case structures
A business case provides the necessary support on which to make decisions for the
approval and or funding (p17 IEPG). The decisions need to be informed by:
The government policy and priority context in which the investment proposal is
made;
the financial and socio-economic impacts of the proposal on the State;
the degree of confidence that the Government can have in the proposal being
successfully implemented to achieve its objectives within the stated budget,
timeline, management structure, financial agreements etc; and
the relative “value for money” that the proposal has against other proposals being
made to Government.
Lifecycle Stages
• Need
• Strategic assessment
• Options
• Business case
• Acquisition/Procurement
• Delivery
• Operation/maintain
• Disposal/extension/upgrade
Starting point: Identification
Analysis framework
Adaption of systems thinking – relates to authority
Thoughts on best practice
• No one system is used universally
• Independent input and critique is a common thread
• Whole of life thinking is important and this is consistently
outworked via comprehensive strategic thinking that is developed
through a ‘business case’
• The style of system – eg master plan, strategic direction, market
lead, informs the authority and reporting arrangements for
independent input
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