PPP trends: Lessons learned from the UK and Australia

Over the past three decades, the UK and Australia have stood at the forefront of public-private partnership (PPP) innovation. These markets were not only early adopters but also set the global benchmark for how to integrate private capital and expertise into large-scale public infrastructure delivery.

The PPP model – where the public and private sectors partner to share the financing burden and risk of building out new infrastructure — has helped to deliver approximately £56 billion of private sector investment into 700 UK infrastructure projects, according to government's PFI Centre of Excellence;¹ whilst in Australia and New Zealand, PPP project value from 2001 to 2023 totalled more than AUD160 billion, according to industry body Infrastructure Partnerships Australia.²

But whilst the PPP model has delivered billions worth of infrastructure projects and has been demonstrated to deliver superior performance in both time and cost relative to traditional infrastructure procurement,³ it has also faced difficulties, with some high-profile cases of cost overruns, long delays, contractor insolvencies and stranded assets.

Australia still deploys PPP, but at a significantly lower volume than a decade ago.

In the UK, the true PPP model is moribund in terms of new procurement, with the last PPP deal having closed in 2016 and the model removed as a policy option in 2018. Government is now focused on optimising current procurement and dealing with end-of-life issues.

By contrast, markets such as Türkiye have been making active and effective use of the PPP model, particularly in the transport and healthcare sectors. This ongoing activity is supported by strong government backing and a developed legal and institutional framework. Several countries in the surrounding region — including parts of Eastern Europe, the Middle East and Central Asia — are also increasingly turning to the PPP model to address infrastructure needs, and, in the case of Central Asia, looking to Türkiye as a model for successful implementation.

This briefing outlines five foundational principles for governments and investors seeking to deliver resilient, commercially viable and publicly credible PPPs in both mature and emerging markets.

Taking the opportunities and avoiding the pitfalls

Thirty years of PPP experience holds valuable lessons for governments and policymakers in fast-growing emerging economies that are looking at PPP as an option for driving infrastructure development.

When the model works well, PPPs help to transfer performance and cost risk from the public sector to the private sector; ease the financial burden on the taxpayer; and accelerate the delivery of infrastructure, and the provision of services, beyond what the public sector could achieve in isolation.

Despite the challenges the PPP model has encountered, research papers have shown that, overall, PPP delivers superior cost-efficiency to conventional procurement⁴ when executed well.

How, then, can governments considering the PPP model unlock these benefits and avoid the pitfalls? What learnings from the UK and Australian contexts can help policymakers in other jurisdictions? What are newer PPP markets, such as Türkiye, doing differently?

Below we outline five foundational principles for governments and investors seeking to deliver resilient, commercially viable and publicly credible PPPs in both mature and emerging markets.

1. Establish a credible legal framework

A core feature of high-performing PPP markets is a coherent and enduring legal framework. In mature markets, such frameworks ensure standardisation, reduce transaction costs and create an investible environment.

In the UK, the early success of PFI was underpinned by institutional consistency and contractual clarity. However, over time, declining political support — particularly in socially sensitive sectors — led to the model's retreat and eventual abandonment. Australia maintained stronger consistency, especially at the state level, despite some variation linked to political cycles.

Türkiye has demonstrated the value of continuity. An established legal framework and strong government support have helped institutionalise best practices. Despite macroeconomic pressures, the legal framework has remained stable, enabling long-term investor confidence.

Lesson: Legal and policy stability is non-negotiable. Legal and institutional continuity builds the investor confidence required for multi-decade partnerships.

2. Establish a meaningful project pipeline

Private sector bidders make major investments to compete in PPP markets — assembling cross-disciplinary teams, navigating regulatory processes, and investing time in feasibility and bid development. A successful PPP market cannot rely on isolated flagship projects. What sustains market interest is a transparent, long-term pipeline aligned with national infrastructure strategies.

This was one of the key failures in the UK post-2008. Whilst early PFI waves helped develop sophisticated PPP players — with integrated design, construction, facilities management and equity capabilities — the financial crisis and ensuing austerity policies dramatically slowed procurement. Contractors were left with high fixed costs and no opportunities. Insolvencies followed, and the UK's PPP supply chain hollowed out.

Australia has avoided the same fate by maintaining a consistent and generally coordinated pipeline, although that has become a growing challenge in recent years with the pipeline of new projects slowing.

Türkiye's PPP momentum has been maintained through deliberate central planning. The Ministry of Health and the Ministry of Transport have published long-term roadmaps for PPP delivery. Mega-projects such as the Istanbul Airport (the world's largest by passenger capacity) and city hospitals in major cities, including Ankara and Istanbul, were part of broader sector strategies, not one-off initiatives.

Lesson: The best PPP markets are not defined by individual projects but by sustained, forward-looking pipelines that enable expertise, competition and innovation to thrive.

3. Prioritise commercial sustainability over cost minimisation

PPP procurement should not be a race to the bottom. Whilst competitive tension is important, excessive focus on lowest cost can lead to under-pricing, delivery risk and project failure.

The competitive dynamics of PPP tenders can create a "winner's curse" where the bidder who makes the most optimistic assumptions wins — only to suffer later. In both the UK and Australia, this phenomenon was observed in transport, health and social infrastructure PPPs, where cost-driven tenders led to thin margins and fragile business cases.

There is growing recognition that value-for-money in PPPs must be assessed over the full life cycle. This includes not just construction and financing costs, but also operational quality, asset performance, user experience and resilience to change.

Best-in-class PPP models now evaluate bids using multi-criteria frameworks, weighting technical capacity, financial stability, ESG credentials and innovation alongside price. Some jurisdictions, like Australia, now place increased scrutiny on aggressive revenue assumptions.

Türkiye's mega-projects have benefited from this longer-term lens. In particular, revenue guarantees on toll road PPPs have provided stability for investors whilst aligning performance incentives. Blended finance models have also been used to crowd in institutional investors with lower risk appetites.

Lesson: Lowest price rarely equates to best value. Procurement must reward durability, reliability and public benefit.

4. Allocate risk to the party best able to manage risk

Effective PPPs rest on intelligent risk allocation. Risks should be allocated not politically or ideologically, but based on which party is best placed to manage them.

In both the UK and Australia, overly aggressive risk allocation proved a recipe for failure. Contractors were often expected to absorb geotechnical risk, utility interface risk and revenue risk — despite lacking sufficient control. The result was predictable: unrealistic bids, contractor distress, project delays and, ultimately, government intervention.

A case in point: In Australia, road PPPs like the Cross City Tunnel and Airport Link collapsed when toll revenue forecasts proved overly optimistic. In the UK, contractors bidding too aggressively for a shrinking pool of projects went bust, leaving unfinished assets and a loss of public trust.

More recently, progressive markets have embraced collaborative contracting models. Incentive target cost (ITC) contracts, for instance, allow for cost sharing and incentivise alignment around outcomes rather than lowest-cost inputs. They acknowledge that not all risks can be priced upfront and reward joint problem-solving.

Türkiye's experience shows how early works, risk scoping and transparent feasibility assessments can reduce uncertainty. In its health and transport PPPs, the government has borne land acquisition and permitting risks, enabling the private sector to focus on design, construction and operations.

Lesson: Poor risk allocation is the fastest path to project failure. Structured collaboration builds resilience.

5. Design for adaptability and change

Infrastructure needs evolve — and PPP contracts must evolve with them. Flexibility, once seen as a risk, is now recognised as a feature.

One of the main criticisms of earlier PPP models, especially in the UK, was contract rigidity. Projects were hard to modify once operational, even when user needs shifted. Adding a ward to a hospital or a classroom to a school required costly renegotiation.

Modern PPPs must strike a balance: strong enough to provide certainty; flexible enough to allow adaptation. This includes mechanisms for change variation, re-scoping, refinancing and dispute resolution — without triggering adversarial proceedings.

In Australia, newer PPPs increasingly incorporate "change protocols" that define how alterations and augmentations are handled. Türkiye's PPPs have also moved in this direction, especially in health and transport, where demographic and demand shifts are inevitable over 25 to 30-year contracts.

Digital transformation is another reason flexibility is key. As cities embrace smart infrastructure, PPP contracts must allow for retrofitting, integration with digital systems and data governance evolution.

Lesson: PPPs must plan for the unpredictable. Built-in agility makes the model resilient.

It's not whether PPPs work—it's how we make them work better

The public-private partnership model is neither a silver bullet nor a failed experiment. The PPP model remains a viable and, in many cases, essential tool for delivering complex infrastructure. Its continued evolution is necessary, not optional. Mature markets can learn from the policy clarity and delivery focus of newer entrants like Türkiye. Likewise, emerging markets can avoid common pitfalls by applying hard-won lessons from the UK and Australia.

With rising demand for climate-resilient, socially inclusive and digitally enabled infrastructure, and with growing urbanisation and population growth — together with tightening public budgets — the imperative is clear. PPPs are an essential tool for infrastructure financing, but they must be smarter, more agile and more transparent. The opportunity is not to replace the model, but to reimagine its role in 21^st century infrastructure delivery.

_{1 https://www.gov.uk/government/collections/public-private-partnerships.
2 https://infrastructure.org.au/public-private-partnerships-by-jurisdiction-year/.
3 https://infrastructure.org.au/wp-content/uploads/2016/12/IPA_PPP_FINAL.pdf.
4 https://infrastructure.org.au/wp-content/uploads/2016/12/IPA_PPP_FINAL.pdf.}

_{White & Case means the international legal practice comprising White & Case LLP, a New York State registered limited liability partnership, White & Case LLP, a limited liability partnership incorporated under English law and all other affiliated partnerships, companies and entities.}

_{This article is prepared for the general information of interested persons. It is not, and does not attempt to be, comprehensive in nature. Due to the general nature of its content, it should not be regarded as legal advice.}

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