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This is a Bill, not an Act. For current law, see the Acts databases.
New South Wales
Local Government Amendment
(Public-Private Partnerships) Bill 2004
Contents
Page
1 Name of Act 2
2 Commencement 2
3 Amendment of Local Government Act 1993 No 30 2
Schedule 1 Amendments 3
I certify that this PUBLIC BILL, which originated in the LEGISLATIVE ASSEMBLY,
has finally passed the LEGISLATIVE COUNCIL and the LEGISLATIVE ASSEMBLY of
NEW SOUTH WALES.
Clerk of the Legislative Assembly.
Legislative Assembly,
Sydney, , 2004
New South Wales
Local Government Amendment
(Public-Private Partnerships) Bill 2004
Act No , 2004
An Act to amend the Local Government Act 1993 in relation to the participation of
councils in public-private partnerships; and for other purposes.
I have examined this Bill, and find it to correspond in all respects with the Bill
as finally passed by both Houses.
Chairman of Committees of the Legislative Assembly.
Clause 1 Local Government Amendment (Public-Private Partnerships) Bill 2004
The Legislature of New South Wales enacts:
1 Name of Act
This Act is the Local Government Amendment (Public-Private
Partnerships) Act 2004.
2 Commencement
This Act commences on a day or days to be appointed by proclamation.
3 Amendment of Local Government Act 1993 No 30
The Local Government Act 1993 is amended as set out in Schedule 1.
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Local Government Amendment (Public-Private Partnerships) Bill 2004
Amendments Schedule 1
Schedule 1 Amendments
(Section 3)
[1] Section 55 What are the requirements for tendering?
Insert after section 55 (1) (h):
(h1) a contract for the formation of a public-private partnership,
[2] Section 55 (5)(7)
Insert after section 55 (4):
(5) Subject to the regulations, a council must comply with the
requirements of this section even though the contract concerned
involves something being done to or by an entity that the council
has formed or participated in forming.
(6) However, if the entity concerned is a public-private partnership,
subsection (5) has effect only to the extent that the contract is not
part of a project that has been assessed or reviewed in accordance
with Part 6 of Chapter 12.
(7) For the purposes of subsections (5) and (6):
entity means any partnership, trust, corporation, joint venture,
syndicate or other body (whether or not incorporated), but does
not include any such entity that is of a class prescribed by the
regulations as not being within this definition.
this section includes the regulations made for the purposes of this
section.
[3] Section 358 Restrictions on formation of corporations and other entities
Insert "or other entity" after "corporation" wherever occurring in section 358
(1).
[4] Section 358 (3) and (4)
Insert after section 358 (2):
(3) In applying for the Minister's consent under subsection (1) (a),
the council is required to demonstrate, to the Minister's
satisfaction, that the formation of, or the acquisition of the
controlling interest in, the corporation or entity is in the public
interest.
(4) In this section, entity means any partnership, trust, joint venture,
syndicate or other body (whether or not incorporated), but does
not include any such entity that is of a class prescribed by the
regulations as not being within this definition.
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Local Government Amendment (Public-Private Partnerships) Bill 2004
Schedule 1 Amendments
[5] Chapter 12, Part 6
Insert after Part 5:
Part 6 Public-private partnerships
Division 1 Preliminary
400B Definitions
(1) In this Act, a reference to a public-private partnership is a
reference to an entity formed under an arrangement between a
council and a private person for the purposes of:
(a) providing public infrastructure or facilities (being
infrastructure or facilities in respect of which the council
retains a beneficial interest under the arrangement), or
(b) delivering services in accordance with the arrangement,
or both, but does not include a reference to any such entity if it is
of a class that has been excluded from the operation of this Part
by the regulations.
(2) In this Part:
arrangement includes a contract or understanding.
entity means any partnership, trust, corporation, joint venture,
syndicate or other body (whether or not incorporated).
PPP guidelines means the guidelines in force from time to time
under section 400C.
private person means any person other than:
(a) the Government (including the State, the Crown and a
Minister of the Crown), or
(b) a public or local authority (including a council or a State
owned corporation), or
(c) a public sector employee or other person or body acting in
an official capacity on behalf of the Government or a
public or local authority.
relevant council, in relation to public-private partnership or
proposed public-private partnership, means the council that has
formed, or is proposing to form, the partnership.
significant project means:
(a) any project with an estimated total cost of more than $50
million or such other amount as may be prescribed by the
regulations, or
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Local Government Amendment (Public-Private Partnerships) Bill 2004
Amendments Schedule 1
(b) any project in respect of which the relevant council's
financial contribution, or its equity position, amounts to
25% or more of the council's annual revenue that is
lawfully available for spending on facilities or services of
the kind to which the project relates.
(3) In determining a relevant council's financial contribution or
equity position in relation to a project for the purposes of this
Part, all elements of the project that the council provides are to be
taken into account, including land value, the provision of
non-monetary goods and services and any costs associated with
the council's contractual liability in the event of the council
incurring a loss under the project.
(4) For the purposes of this Part, a project under a public-private
partnership that is carried out in stages is to be treated as a single
project. The PPP guidelines may also specify other
circumstances in which related projects carried out under a
public-private partnership are to be treated as a single project for
the purposes of this Part.
400C Guidelines to be followed by councils in relation to public-private
partnerships
(1) The Director-General may from time to time issue guidelines
requiring specified procedures and processes to be followed by
councils in relation to the formation of, and the carrying out of
projects under, public-private partnerships.
(2) Without limitation, the PPP guidelines may contain provisions
requiring:
(a) feasibility and risk assessment, and
(b) the identification of appropriate governance and
administrative arrangements (including appropriate
management structures and auditing requirements), and
(c) the undertaking of on-going risk management measures,
and
(d) due diligence in the carrying out of projects under
public-private partnerships.
400D Ancillary provisions relating to PPP guidelines
(1) The PPP guidelines are to be made available to councils in such
manner as the Director-General thinks appropriate.
(2) The Director-General may from time to time amend or replace
the PPP guidelines.
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Local Government Amendment (Public-Private Partnerships) Bill 2004
Schedule 1 Amendments
Division 2 Restrictions relating to public-private
partnerships
400E General requirements
(1) A council must not:
(a) form a public-private partnership, or
(b) carry out any project under a public-private partnership,
except in accordance with this Part.
(2) Without limiting subsection (1), a council is required to comply
with the PPP guidelines at all times while carrying out a project
under a public-private partnership.
400F Council to provide assessment of PPP project to Director-General
(1) A council must not form a public-private partnership unless the
council has provided the Director-General with an assessment of
the project to be carried out under the partnership.
(2) In providing such an assessment, the general manager of the
council is required to certify that it has been prepared in
accordance with the PPP guidelines.
(3) If:
(a) the project to be carried out under the public-private
partnership is a significant project, or
(b) the Director-General is of the opinion, having regard to the
criteria specified in the PPP guidelines, that the project has
a high risk,
the Director-General is to advise the council that the project is
required to be referred to the Project Review Committee for
review.
(4) If the Director-General advises the council that the project is not
required to be referred to the Project Review Committee, the
council is entitled:
(a) subject to obtaining the Minister's consent under section
358 (1) (a), to proceed with the formation of the
public-private partnership, and
(b) subject to this Division, to carry out the project that is the
subject of the assessment.
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Local Government Amendment (Public-Private Partnerships) Bill 2004
Amendments Schedule 1
400G Minister may require PPP project to be referred to Project Review
Committee
(1) The Minister may, on such grounds as the Minister thinks fit,
direct a council to refer any project that is to be carried out, or is
being carried out, under a public-private partnership to the
Project Review Committee for review.
(2) Any such direction:
(a) may be given at any stage in the process of forming the
public-private partnership or in the carrying out of the
project under the partnership, and
(b) must be complied with by the council.
400H Director-General may require council to provide assessment of
varied PPP project
(1) If the Director-General is of the opinion that a project that is to be
carried out, or is being carried out, under a public-private
partnership has been, or is proposed to be, varied in a significant
manner, the Director-General may require the relevant council to
provide the Director-General with an assessment of the project as
varied or proposed to be varied. Section 400F (2) applies in
relation to any such assessment.
(2) If the Director-General is of the opinion that the project has or
will become:
(a) a significant project, or
(b) a high risk project (having regard to the criteria specified
in the PPP guidelines),
the Director-General is to advise the council that the project is
required to be referred to the Project Review Committee for
review.
(3) The relevant council must comply with a direction under
subsection (1).
400I Review of PPP project by Project Review Committee
(1) If a project is required or directed to be referred to the Project
Review Committee for review, the relevant council must not
form a public-private partnership to carry out the project, or
proceed with the carrying out of the project under a
public-private partnership, unless:
(a) the relevant council has provided the Project Review
Committee with an assessment of the project in accordance
with the PPP guidelines, and
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Local Government Amendment (Public-Private Partnerships) Bill 2004
Schedule 1 Amendments
(b) the Project Review Committee has reviewed the project
and is satisfied that the requirements of the PPP guidelines
have been complied with in relation to the project.
(2) The relevant council has the responsibility of demonstrating to
the Project Review Committee, in conducting its review of the
project, that the requirements of the PPP guidelines have been
complied with in relation to the project.
(3) If the Project Review Committee advises the council that the
Committee is satisfied that the requirements of the PPP
guidelines have been complied with in relation to the project, the
council is entitled:
(a) to proceed with the formation of the public-private
partnership (if it has not already been formed), or
(b) subject to this Division, to proceed with the carrying out of
the project.
(4) The Project Review Committee's decision as to whether or not
the relevant council has complied with the requirements of the
PPP guidelines in relation to a project is final and cannot be
reviewed by any court or tribunal.
Division 3 Local Government Project Review
Committee
400J Establishment and constitution of Project Review Committee
(1) A Local Government Project Review Committee is established.
(2) The Project Review Committee is to consist of the following
members:
(a) the Director-General (or an officer of the Department
nominated by the Director-General) who is to be the
chairperson of the Committee,
(b) the Secretary of the Treasury (or an officer of the Treasury
nominated by the Secretary),
(c) the Director-General of the Premier's Department (or an
officer of the Premier's Department nominated by that
Director-General),
(d) the Director-General of the Cabinet Office (or an officer of
the Cabinet Office nominated by that Director-General),
(e) the Director-General of the Department of Infrastructure,
Planning and Natural Resources (or an officer of that
Department nominated by the Director-General of that
Department),
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Local Government Amendment (Public-Private Partnerships) Bill 2004
Amendments Schedule 1
(f) such other persons as may be appointed by the
Director-General for the purposes of enabling the Project
Review Committee to exercise its functions.
(3) The appointment by the Director-General of persons as members
of the Project Review Committee under subsection (2) (f) is to be
made on the basis of the nature, or subject-matter, of the project
that is before the Committee for review. In doing so, the
Director-General is to ensure that any person appointed as a
member has the relevant expertise to enable the Committee to
properly exercise its functions in relation to the project
concerned.
(4) Without limiting subsection (3), the Director-General may
appoint persons from the private sector as members of the Project
Review Committee.
(5) The Project Review Committee has such functions as are
conferred or imposed on it by or under this or any other Act.
(6) Schedule 3 has effect with respect to the members and procedure
of the Project Review Committee.
Division 4 Miscellaneous provisions
400K Compensation not payable
(1) Compensation is not payable by or on behalf of the State arising
directly or indirectly from any of the following matters occurring
before or after the commencement of this Part:
(a) the enactment of the Local Government Amendment
(Public-Private Partnerships) Act 2004 or the operation of
this Part,
(b) the exercise by the Minister, an officer of the Department
or a member of the Project Review Committee of any
function under this Part (including any failure or delay in
exercising any such function),
(c) any statement or conduct in connection with public-private
partnerships or this Part.
(2) Compensation is not payable by a council to any private person
as a consequence of the council being prevented, by the operation
of this Part, from forming a public-private partnership or from
carrying out a project under a public-private partnership.
(3) However, subsection (2) does not apply in relation to a council if
the public-private partnership concerned is a partnership referred
to in section 400N (2).
Page 9
Local Government Amendment (Public-Private Partnerships) Bill 2004
Schedule 1 Amendments
(4) In this section:
compensation includes damages or any other form of monetary
compensation.
conduct includes any act or omission, whether unconscionable,
misleading, deceptive or otherwise.
statement includes a representation of any kind, whether made
verbally or in writing and whether negligent, false or misleading
or otherwise.
the State means the Crown within the meaning of the Crown
Proceedings Act 1988, and includes an officer, employee or agent
of the Crown or any member of the Project Review Committee.
400L Decision by council to form public-private partnership
Any decision by a council in relation to the formation of a
public-private partnership may only be made by resolution of the
council.
Note. Section 377 (1) provides that any function expressly required to be
exercised by resolution of the council cannot be delegated.
400M No contracting out
This Part applies regardless of the terms of any arrangement
between a council and a private person.
400N Application of Part
(1) This Part does not apply to any public-private partnership that a
council resolved, before 28 June 2004, to form under an
arrangement with a private person, even though the arrangement
was entered into after that date.
(2) However, if a council resolved, on or after 28 June 2004 but
before the commencement of this Part, to form a public-private
partnership with a private person, this Part applies to and in
respect of the partnership (regardless of whether the arrangement
for the formation of the partnership was entered into before that
commencement).
[6] Section 428 Annual reports
Insert "(including public-private partnerships)" after "joint ventures" in
section 428 (2) (q).
[7] Section 625 How may councils invest?
Insert "or an entity within the meaning of that section" after "corporation" in
section 625 (4).
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Local Government Amendment (Public-Private Partnerships) Bill 2004
Amendments Schedule 1
[8] Schedule 3
Insert after Schedule 2:
Schedule 3 Provisions relating to members and
procedure of Project Review
Committee
(Section 400J (6))
1 Definitions
In this Schedule:
appointed member means a person who is appointed by the
Director-General under section 400J (2) (f) as a member of the
Project Review Committee.
Chairperson means the Chairperson of the Project Review
Committee.
member means any member of the Project Review Committee.
2 Terms of office of appointed members
Subject to this Schedule, an appointed member holds office for
such period as is specified in the member's instrument of
appointment.
3 Part-time appointments
Appointed members hold office as part-time members.
4 Remuneration
An appointed member is entitled to be paid such remuneration
(including travelling and subsistence allowances) as the Minister
may from time to time determine in respect of the member.
5 Removal of appointed members
(1) The Director-General may remove an appointed member from
office at any time.
(2) A person is not entitled to any compensation if the person is
removed from office under subclause (1).
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Local Government Amendment (Public-Private Partnerships) Bill 2004
Schedule 1 Amendments
6 Disclosure of pecuniary interests
(1) If:
(a) a member has a direct or indirect pecuniary interest in a
matter being considered or about to be considered at a
meeting of the Project Review Committee, and
(b) the interest appears to raise a conflict with the proper
performance of the member's duties in relation to the
consideration of the matter,
the member must, as soon as possible after the relevant facts have
come to the member's knowledge, disclose the nature of the
interest at a meeting of the Committee.
(2) A disclosure by a member at a meeting of the Project Review
Committee that the member:
(a) is a member, or is in the employment, of a specified
company or other body, or
(b) is a partner, or is in the employment, of a specified person,
or
(c) has some other specified interest relating to a specified
company or other body or to a specified person,
is a sufficient disclosure of the nature of the interest in any matter
relating to that company or other body or to that person which
may arise after the date of the disclosure and which is required to
be disclosed under subclause (1).
(3) Particulars of any disclosure made under this clause must be
recorded by the Project Review Committee in a book kept for the
purpose and that book must be open at all reasonable hours to
inspection by any person on payment of the fee determined by the
Director-General.
(4) After a member has disclosed the nature of an interest in any
matter, the member must not, unless the Minister or the Project
Review Committee otherwise determines:
(a) be present during any deliberation of the Project Review
Committee with respect to the matter, or
(b) take part in any decision of the Committee with respect to
the matter.
(5) For the purposes of the making of a determination by the Project
Review Committee under subclause (4), a member who has a
direct or indirect pecuniary interest in a matter to which the
disclosure relates must not:
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Local Government Amendment (Public-Private Partnerships) Bill 2004
Amendments Schedule 1
(a) be present during any deliberation of the Committee for
the purpose of making the determination, or
(b) take part in the making by the Committee of the
determination.
(6) A contravention of this clause does not invalidate any decision of
the Project Review Committee.
7 Effect of certain other Acts
(1) Chapter 2 of the Public Sector Employment and Management Act
2002 does not apply to or in respect of the appointment of an
appointed member.
(2) If by or under any Act provision is made:
(a) requiring a person who is the holder of a specified office to
devote the whole of his or her time to the duties of that
office, or
(b) prohibiting the person from engaging in employment
outside the duties of that office,
the provision does not operate to disqualify the person from
holding that office and also the office of an appointed member or
from accepting and retaining any remuneration payable to the
person under this Act as a member.
8 Personal liability
A matter or thing done or omitted to be done by the Project
Review Committee, a member of the Project Review Committee
or a person acting under the direction of the Project Review
Committee does not, if the matter or thing was done or omitted to
be done in good faith for the purpose of executing this or any
other Act, subject a member or a person so acting personally to
any action, liability, claim or demand.
9 General procedure
The procedure for the calling of meetings of the Project Review
Committee and for the conduct of business at those meetings is,
subject to this Act and the regulations, to be as determined by the
Chairperson.
10 Quorum
The quorum for a meeting of the Project Review Committee is a
majority of its members for the time being.
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Local Government Amendment (Public-Private Partnerships) Bill 2004
Schedule 1 Amendments
11 Presiding member
(1) The Chairperson (or, in the absence of the Chairperson, a person
elected by the members of the Project Review Committee who
are present at a meeting of the Committee) is to preside at a
meeting of the Committee.
(2) The presiding member has a deliberative vote and, in the event of
an equality of votes, has a second or casting vote.
12 Voting
A decision supported by a majority of the votes cast at a meeting
of the Project Review Committee at which a quorum is present is
the decision of the Committee.
13 Transaction of business outside meetings or by telephone
(1) The Project Review Committee may, if it thinks fit, transact any
of its business by the circulation of papers among all the members
of the Committee for the time being, and a resolution in writing
approved in writing by a majority of those members is taken to be
a decision of the Committee.
(2) The Project Review Committee may, if it thinks fit, transact any
of its business at a meeting at which members (or some members)
participate by telephone, email, closed-circuit television or any
other means, but only if any member who speaks on a matter
before the meeting can be heard by the other members.
(3) For the purposes of:
(a) the approval of a resolution under subclause (1), or
(b) a meeting held in accordance with subclause (2),
the Chairperson and each member have the same voting rights as
they have at an ordinary meeting of the Project Review
Committee.
(4) A resolution approved under subclause (1) is, subject to the
regulations, to be recorded in the minutes of the meetings of the
Project Review Committee.
(5) Papers may be circulated among the members for the purposes of
subclause (1) by facsimile, email or other transmission of the
information in the papers concerned.
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Local Government Amendment (Public-Private Partnerships) Bill 2004
Amendments Schedule 1
[9] Schedule 6 Regulations
Insert after clause 17:
Public-private partnerships (including meetings of a
17A
public-private partnership)
[10] Schedule 8 Savings, transitional and other provisions consequent on
the enactment of other Acts
Insert at the end of clause 1 (1):
Local Government Amendment (Public-Private Partnerships)
Act 2004
[11] Dictionary
Insert in alphabetical order:
Project Review Committee means the Local Government Project
Review Committee established under section 400J.
public-private partnership--see section 400B.
Page 15
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