Adversarial contracting methods are used for most public infrastructure procurement and timely delivery on budget remains a problem. In the past 20 years, OECD countries have adopted a number of alternative procurement methods that are based on collaborative principles including public private partnerships, long-term outsourcing arrangements and relationship/alliance contracts. We review the theoretical principles that operate for both adversarial and collaborative contracting methods. We identify the characteristics of non-adversarial contracting methods such as the output specification, qualitative selection criteria, the alignment of incentives, discrete allocation of residual control rights, life cycle costing, and risk-weighted value for money measurement that are delivering better procurement outcomes for government.
Regan, M., Love, P. E. D., & Smith, J. (2015). Public infrastructure procurement: A review of adversarial and non-adversarial contracting methods. Journal of Public Procurement, 15(4), 405-438. https://doi.org/10.1108/JOPP-15-04-2015-B001