Both developed and developing nations face serious challenges with the financing, construction and operation of public infrastructure.
For developed nations, governments with highly constrained budgets find themselves barely able to meet the day-to-day demands of providing health, education, justice and other services. For many, creating major new infrastructure is becoming a distant dream.
The challenge for the developing world is even more acute. There is ample evidence that the impact of each dollar spent on infrastructure delivers greater outcomes for their economies than investment of the corresponding dollar in developed economies. Just as importantly, this investment also creates important social outcomes by giving the poor better to access markets which, in turn, assists with their ability to acquire productive skills. However, developing country governments wanting to make the large and lumpy financial commitments demanded by infrastructure find their budgets even more constrained than developed countries.
For these reasons, governments are looking increasingly for solutions involving private sector expertise, innovation and finance. The flagship solution is public private partnerships, though there are other options as well.
Australian governments have been international leaders in attracting private investment for public infrastructure such as toll roads, hospitals, public transport and prisons. More than US40 billion has been invested in more than 100 projects. The Economist Intelligence Unit has ranked Australia as the best country for PPPs in the Asia Pacific Region.
That is not to say that everything has gone smoothly, there have been plenty of stumbles along the way. Valuable lessons have been learnt from both the great successes and some spectacular failures. There is now a comprehensive store of research literature available on the experiences of Australia and other developed countries. This is particularly valuable for students from developing countries at earlier stages in their use of private finance for public infrastructure. Drawing on this research gives students an understanding of the mistakes and an ability to advise their home countries on how to avoid them.
Carnegie Mellon University Australia is picking up on the burgeoning interest in PPP delivery of infrastructure, particularly in developing countries. The university has developed a curriculum for its Masters of Science in Public Policy and Management focusing on PPPs. More than half of the courses deal directly with PPPs or with topics closely linked to their management such as specialist courses on anti-corruption and public finance with a PPP orientation. Consistent with the emphasis the university place on practical applications, the course draws heavily on both practitioner experience and research.
The focus on PPPs forms part of the skills-based curriculum for which the university is renowned, particularly the use of technology and analytic techniques to generate innovative solutions. These skills, combined with contemporary technological capabilities, are becoming increasingly important for PPP practice. They allow for much better prediction giving practitioners within industry and government unprecedented capabilities for customising projects and programs to achieve greater user support and better value for money. This is the new frontier for PPP practice for which CMU gradauates will be well prepared.
