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CASE STUDY

12: SEPTEMBER - NOVEMBER 2021: BUILT ENVIRONMENT ECONOMIST

RAVENHALL CORRECTIONAL CENTRE

CASE STUDY

BUILT ENVIRONMENT ECONOMIST: SEPTEMBER - NOVEMBER 2021: 13

Victoria’s fifteenth prison, Ravenhall Correctional Centre, was officially opened in October 2017, and began receiving prisoners in November 2017. The facility provides accommodation and services for male, medium-security prisoners, as well as specialist forensic mental health services for 75 prisoners in dedicated forensic mental health beds.

The prison is designed to flexibly respond to different prisoner profiles that may emerge over time. Its areas of focus include:

• new approaches to reducing the risk of reoffending

• implementing an integrated and holistic model of care for prisoners with a mental illness

• implementing a targeted approach for prisoners with challenging behaviours

• indigenous prisoners

• improved responsiveness to the complexities of young adult prisoners

• programs and services for prisoners serving shorter sentences

• pre and post-release services.

The prison was procured as a full service Public Private Partnership (PPP) with a private sector consortium financing, designing, building, and now operating the prison for a period of 25 years until 2042. Under the PPP the successful consortium was required to provide a full suite of correctional, health and facilities management services.

MBM was engaged as the facilities management (FM) adviser to assist primarily with the following:

• provide facilities and asset management advisory services, technical expertise and advice to Department of Justice and Community Safety (DJCS) on FM services with respect to the scope of works associated with the design and construction of the Ravenhall facility and its ongoing operation and maintenance, with a view to optimising whole-of-life costs

• liaise closely with the other technical advisers to the project, including through relevant working groups (e.g., correctional services, commercial, and legal), to ensure coordinated technical documentation.

A major contribution to ongoing operational term issues in these types of social infrastructure projects is a lack of common understanding by the client and successful respondent on the required scope at the start of the project. A properly defined and managed scope leads to the delivery of quality services at an agreed cost to the stakeholders.

The challenge for MBM was to ensure that technical requirements included within the request for proposal (RFP) provided sufficient detail to enable a clear understanding of requirements whilst not

Photo courtesy of The GEO Group Australia Pty. Ltd.


CASE STUDY

being too prescriptive, thereby allowing the respondents to offer up innovative solutions.

Using market tested benchmark requirements adjusted to suit the specific requirements of stakeholders and DJCS, MBM developed a detailed description of the service requirements indicating:

• relevant standards and guidelines

• outcomes required (describing the key outcomes required by DJCS and relevant stakeholder for the service, which should be considered when delivering each of the FM services

• minimum requirements (outlining the state’s minimum requirements in relation to the relevant service).

This enabled respondents to clearly see how the expected outputs generated by the delivery of the service would deliver benefits for users and the main responsibilities for both the respondent and related to the service to be delivered, that were being retained by DJCS or the stakeholders.

The scope of the project also included construction and operation of a Statewide Services Building (SSB) outside of the prison walls. This

presented a challenge in terms of having a very different set of requirements for the FM services and an understandable reluctance to have two different sets of services requirements. MBM and the project team worked closely with relevant stakeholders to align service requirements where possible and to only make specific reference to the SSB where absolutely necessary. This reduced the potential complexity of the services specification and ensured a common level of service across all facilities within the scope of the PPP.

MBM developed minimum applicable asset, cleaning, and grounds maintenance condition and performance standards for the prison and Statewide Services Building, against which the performance of the successful respondent would be measured over the term of the PPP. Where possible the services requirements were aligned to technical design requirements in order to ensure that condition and performance standards were aimed at ensuring fit for purpose facilities rather than specifying unrealistic condition and performance standards that would be difficult to achieve over the life of the assets.

A key criticism levelled at a number of social infrastructure PPPs in Australia is the number of key performance indicators (KPIs) the service providers are required to measure and report on, and the penal nature of performance abatements on the payment mechanism. In conjunction with the project team and relevant stakeholders, MBM reviewed performance regimes and payment mechanisms on comparable projects across Australia, New Zealand, and the United Kingdom.

It was clear that, under full-service model correctional centre PPPs, the availability charge (related to the number of daily available cells and a comprehensive list of criteria defining how availability was measured) would encompass a number of traditional service related KPIs.

MBM proposed KPIs related to the completion of planned maintenance tasks and the completion of reactive maintenance with specified timeframes, thereby ensuring service failures relating to health, safety and wellbeing of users and prisoners would be appropriately abated, however, service failures which had a lesser impact would be dealt under alternative contract mechanisms.

CASE STUDY

BUILT ENVIRONMENT ECONOMIST: SEPTEMBER - NOVEMBER 2021: 15

The FM services that were included under the scope of the project included:

• general FM service requirements and provisions applicable to all services, including management of delivery, training and induction, and reporting systems

• building management services - planned and reactive maintenance, and lifecycle maintenance

• utilities and medical gas management services to ensure continuous provision of utilities and medical gases

• waste management and disposal services including collection, onsite recycling, and offsite disposal

• grounds maintenance services for sports ovals, car park, and external areas

• pest control services

• cleaning services for prisoner and non-prisoner areas

• specific requirements, where relevant, about the service handover to government at the end of the contract.

During the procurement process, MBM worked closely with the project team

under the evaluation framework to evaluate:

• the respondent’s plans and method statements to provide and manage the FM services

• the robustness of the proposed operational readiness and ramp-up plan for the implementation of the services and introduction of prisoners at the facilities

• the VFM offering of the lifecycle and FM services taking into account financial costs, risks, and continuous improvement and innovation over the operating phase.

The successful respondent was the GEO consortium, whose major members included GEO Group (facility operator and equity investor), John Holland, (builder), Honeywell (facilities management) and Capella Capital (financial adviser).

The project was the first Victorian PPP to be procured under the new Victorian PPP Guidelines and incorporated a high value/high risk (HVHR) peer review by the Department of Treasury and Finance (DTF). The HVHR framework comprises a series of project assurance checks and

processes to increase the likelihood that they will achieve their stated benefits and be delivered successfully on time and to budget. Acknowledging that available prisoner places was a key project objective, MBM worked closely with the project team and stakeholders to develop a regime that ensures standards are maintained without placing undue risk with the GEO consortium and ensure that this objective was met.

In awarding the Ravenhall Prison Project the Project of the Year Award for Infrastructure Partnerships, Infrastructure Partnerships Australia Chief Executive Adrian Dwyer said it was exciting to see the project excel, as it was the first privately delivered prison project Victoria had seen in about 20 years – delivered on budget and on time.

“The Ravenhall Prison Project fundamentally transforms the way that support is provided to people in the justice system in Victoria,” Mr Dwyer said.

“In a Victorian first, the proponents will oversee all elements of the prison’s operations, including custodial services, with performance targets to directly reduce the rate of recidivism. Australia is a world leader in bringing together the



CASE STUDY

“Congratulations to our advisory team, the wider project advisory team, Project Co and Department of Justice for delivering a best-in-class project," Mr Pearson said.

This case study was written by Justin Noakes, Director at MBMpl.

public and private sectors through Public Private Partnerships (PPPs) to deliver better outcomes for the community.

“The Ravenhall Prison Project is a stellar example of the evolution of the PPP model in Australia and shows what can be achieved when the public and private sectors collaborate to achieve good outcomes.”

MBM CEO David Pearson said the Ravenhall Prison Project was an excellent example of a successful PPP and MBM was very proud and privileged to be part of this successful project.


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+61 2 8234 4000

www.aiqs.com.au

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SEPTEMBER - NOVEMBER 2021