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PPP deal for Western Australia schools aims to save $100 million

Western Australia has signed a contract to build eight schools under a public-private partnership (PPP) that it said will save the state AU$100 million (£47 million).27 Oct 2015

EduWest, which is made up of Macquarie Capital, Badge Constructions, Perkins and Spotless Facility Services, will finance, design and build the eight public schools and then maintain them for up to 31 years, the Western Australian government said.

The project will include four primary and four secondary schools.

Using a 'public sector comparator' tool, Western Australia estimated that the PPP contract will save AU$100m compared to the state using a traditional procurement process, it said.

The state government will not begin payments to Eduwest until each school is operational, Western Australia treasurer Mike Nahan said.

Education Minister Peter Collier said: "The Public Private Partnership is about delivering high quality schools for Western Australian students, while assisting the state to contain costs and ensure that infrastructure meets needs."

Infrastructure expert Simela Karasavidis of Pinsent Masons, the law firm behind Out-Law.com said: "There has been so much written in the Australian press lately regarding the use of alternative procurement models to delivery public infrastructure that you can easily forget that sometimes sticking to the ‘tried and tested’ PPP model can deliver great results too. The infrastructure sector in Australia is excited that the first schools PPP project in Western Australia is off and running."

The Western Australia construction sector said last month that the state should borrow to build infrastructure, while borrowing costs are low.

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