nbn agrees new performance-based contract model with construction firms

10 Jun 2015

Australia’s government-backed broadband provider nbn (formerly NBN Co), the company tasked with overseeing the Australian National Broadband Network (NBN) project, has restructured its contracting model in association with the country’s construction industry. According to nbn, the new performance-based contracts are the result of ‘extensive industry consultation’ and aim to increase the quality and speed of multi-technology rollouts to homes and businesses. The terms represent a marked departure from the old commercial model which guaranteed large volumes of work to suppliers in specified states and regions regardless of performance, and also placed upon them a high administrative burden and no competition for that work. In contrast, the new contracts offer flexible volume commitments, competition between delivery partners, and pricing based on outcomes rather than inputs.

Targeting the delivery of the nbn network to a further four million premises, Downer, Transfield, Visionstream, Fulton Hogan and WBHO were the first construction companies to sign the new contracts, on 10 June. Contracts with additional suppliers are also being negotiated and nearing conclusion.

nbn CEO Bill Morrow commented: ‘We have worked closely with the industry to reduce the complexity of our contracts to make them easier to administer and to reward good work as we gear up to accelerate the rollout.’

Australia, NBN Co