Australia: Victorian Government has modified the Market-Led Proposals Process - what proponents need to know

In brief

The Victorian Treasurer Tim Pallas MP recently announced changes to the Market-Led Proposals (MLP) Guidelines to (a) remove the "uniqueness" criteria, (b) introduce a need to justify exclusive negotiations, (c) seek to align MLPs with new Government project priority areas and (d) simplify the MLP assessment process.

This new regime allows the Victoria Government to manage MLPs in a more streamlined fashion.  The new process is described in the updated MLP Guidelines and Government Priority Areas list.


Contents

Key takeaways

Key changes to the MLP process include:

No. Previous requirement New requirement
1. Uniqueness criteria Changed criteria - justification for exclusive negotiations
2. No equivalent requirement MLPs will be considered against Government priority areas list
3. Five stage process Three stage (streamlined) process

 

Considering each in turn:

  1. Changed criteria - justification for exclusive negotiations: By now requiring that proponents must justify why the MLP warrants exclusive negotiations with government, the new MLP Guidelines have effectively broadened the criteria against which projects can be assessed.  Uniqueness may still justify exclusive negotiations, although other reasons could include that it would be financially beneficial to avoid a competitive tender process (for example, if the proponent has assets or skills that could not be procured through a market tender) or that no other party is capable of delivering the project other than the proponent.
  2. Government priority areas list: MLPs are now assessed against new Government priority areas.  These are not stated to be mandatory, though proponents should consider if their projects can meet at least one of these criteria to maximise the prospects of success:

Priority areas

 

 

Bushfire prevention

International education

Retail, transport distribution and logistics

Visitor economy

Health infrastructure

Social and community infrastructure and services

Digital technologies

Medical technologies and pharmaceuticals

Environment and sustainability

Creative industries

 

 

 

  1. Three stage (streamlined) process: The original five-stage assessment process has been streamlined to three stages.  Practically, this is a consolidation of the existing process, as can be seen below:

New process

Old process

Pre-Stage 1 – Pre-submission meeting with DTF

Assist proponent to understand process; other Departments may attend

Pre-Stage 1

As per new process

-

Stage 1 – Preliminary assessment DTF

DTF can accept, reject, or put to a competitive process

Stage 1 - Filtering of Projects and DD DTF

DTF can accept, reject, or put to a competitive process

Limited project details published

Stage 2 – DD and Strategic Assessment DTF

Same outcomes per Stage 1; "uniqueness" criteria assessed

Project details published

Stage 2 – Investment Case and Negotiation of Project

Same outcomes as per Stage 1

Stage 3 – Procurement preparation

Same outcomes as per Stage 1

Stage 3 – Exclusive Negotiations

May result in contract award

Stage 4 – Contract negotiations, value for money assessment

Same outcomes as per Stage 1

-

Stage 5 – Contract Award

 

The new process involves the Department of Treasury and Finance from start to finish and involves the Department of Premier and Cabinet early in the process.

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