1. Capital Insight Pty Limited ABN 76 056 297 100 77 Berry Street North Sydney NSW 2060 T02 9955 2300 F02 9955 5574 www.capitalinsight.com.au Bowral District Hospital Redevelopment Options Stuart Muirhead July 2013

2. Overview Engagement ScopeOpportunities and OptionsAnalysisProcurement Issues

3. Engagement Scope Determine drivers for change Demand increases Service Development Facilities condition and functionality Assess opportunities and constraints Private hospital spare capacity Redevelopment is No4 on ASP ‘Off balance sheet’ funding required Option development and assessment Financial analysis Procurement strategy

4. Redevelopment Opportunities and Constraints ED Imaging Theatres HDU Private Hospital Heritage Buildings Heritage Building/ Landscape Ambulance Station

5. Preliminary Redevelopment Options ParameterOption 1Option 2 Conventional redevelopmentServices Contract (short-term) with limited redevelopment Service/ Facility scope Clinical:ED/HDU Wards Theatres & recovery Clinical Support Non-Clinical Support Corporate and Admin Public Private Private & Public* Public Private Public / Private Private Public / Private Similar toLiverpoolPeel Health Campus Contract / Funding Basis Public or PPP (with FDBOM) and handover at end of (25 year) term Service contract Moderate public capital contribution (on balance sheet) Handover at end of (15 year) term End-of-term reconfiguration/ investment NilShared clinical, clinical support and support

6. Financial Analysis Comparative cashflows Efficiency savings Affordability Sinking fund approach Capital contribution

7. Procurement Issues Unsolicited Proposal or Direct Approach (preferred) Direct Approach criteria: – IP rightsNo – Ownership of integral physical propertyYes – Optimal value for moneyYes – Unilateral achievement of timeframeNo – One organisation position for expeditious deliveryYes Approval to proceed given by Cabinet Need to carefully manage probity Seek arrangement with no increase in operating costs