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Summit Targets Better Value Health Infrastructure

14 March 2012

"Better partnership between the public and private sector is key to improving value for money in the delivery of health infrastructure," says New Zealand Council for Infrastructure Development, chief executive Stephen Selwood.

"The combination of unrelenting fiscal pressures and escalating health care demands means that the public and private sectors need to work more collaboratively to find better ways to do things", Selwood says.

"To address this important challenge, NZCID is facilitating an Advanced Capital Procurement in Health Summit to be held in Wellington this Friday 16 March. The Summit will bring together industry leaders in health infrastructure construction, maintenance and financing with senior public health sector officials to examine how advanced project delivery and a focus on whole of life asset management can make better use of constrained public funds.

"Traditional contracting methods which focus on the least cost design and construction methods often lead to cost overruns in the short term and higher maintenance and operating costs in the long term. On the other hand, early contractor involvement and alliance contracting methods allow constructors to be engaged early in the design phase when the cost of any change in scope is much less. Public Private Partnership contracting methods require the private sector to carry whole of life maintenance risk which means a much stronger focus on value for money over time.

"Delegates, including District Health Board leaders and Ministry officials, will learn about the risks and benefits of alternative procurement methodologies. The objective is to identify the contracting methods that will deliver the best long term value in the construction and lifetime asset management of hospitals and health care facilities. The summit will also examine the experience with shared service arrangements between District Health Boards, as well as utilising existing private hospital capacity more effectively.

"International authorities will share how their jurisdictions have dealt with the same issues faced by New Zealand. Speakers include: Dr David Panter, Executive Director Health Reform for the Department of Health South Australia, discussing the most recent PPP health project in Australia, the Royal Adelaide Hospital; Associate Professor Kaye Challinger, former head of nursing and CEO of Royal Adelaide Hospital, explaining how clinical needs were addressed in the development of the new hospital; and Sandy Rosie, former Scottish Government Director, Financial Partnerships Unit, architect of The Hub concept, will discuss providing health and community services in integrated facilities.

"Not only will senior delegates hear from international procurement leaders, they will also be invited to share their industry expertise in cross-sector workshops designed to identify gaps and solutions for the healthcare sector. We anticipate that the learning from the day will help identify capital projects suitable for alternative procurement methods.

"Private involvement is current government policy and Treasury's Better Business Cases for Capital Proposals requires that capital health projects consider a range of alternative procurement options, including PPPs, so this timely summit will provide valuable information for decision makers and policy officials," Selwood says.

NZCID submissions and media statements can be found online: www.nzcid.org.nz



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