This article reviews the recent experience of franchising metropolitan public transport services in
Melbourne, Australia, to assess the extent to which the declared objectives of the franchising have been
achieved. The failure of the initial franchise process is argued to be attributable, in significant part, to
shortcomings in the Government’s understanding of what was achievable from a public-private initiative
of this nature, given the Melbourne context. Developments associated with the re-franchising process are
summarised, the emphasis shifting towards a strong partnership relationship between purchaser and
provider, with a more realistic risk allocation between the two.
