Report 13

Maintaining the State Road Network – Follow-on Audit

Appendix 3: Integrated Service Arrangements

Integrated Service Arrangements (ISAs) were introduced by Main Roads in 2010-11 to replace the Term Network Contract maintenance model. ISAs source people, systems and processes from an Integrated Service Provider (‘contractors’) and use these alongside Main Roads resources and approaches to manage operational assets and delivery road services.

Contractors receive reimbursement of their direct costs, plus a percentage of an agreed fee should the work meet or exceed agreed performance standards. If the work does not meet these standards, the contractor bears some of the costs associated with losses. Main Roads refers to this as gain and pain within a fee-modifier regime.

Until standardised performance indicators were introduced in 2014, regions (Main Roads and contractors) devised their own.

Main Roads currently had 8 ISAs operating to cover the needs of the 10 Main Roads regions. The contractors involved are DownerMouchel, Fulton Hogan, Ventia Optus, Ventia and Lend Lease Services Pty Ltd.

Main Roads outlines the following objectives and principles for the ISAs.

ISA objectives:

  • as asset owner, Main Roads regaining influence and control over asset management decisions
  • achieving ‘best practice’ in operational asset management
  • achieving ‘best practice’ in network operations
  • building and maintaining capability and capacity
  • achieving innovation, ongoing improvement and outstanding performance
  • achieving value for money through appropriate risk sharing.

ISA principles:

ISA are required to reflect the following principles:

  • a ‘best for network’ approach, combining the best systems and people from both the public and private sectors
  • a non-adversarial approach based on a culture of open communication and collaborative decision-making
  • an open-book approach with transparency in pricing
  • recognition of the opportunities for developing and retaining core knowledge and skills in the ISAs
  • support for flexibility and investment in research and innovation
  • shared decision-making.
Page last updated: June 29, 2016
 

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