Final answer:
DBOM, DBFOM, and Concession Contracts can deliver value for money in construction projects by integrating services, adding financing, and allocating risks that facilitate project efficiency and quality. Examples include water treatment facilities (DBOM), toll roads (DBFOM), and airports (Concession Contracts).
Step-by-step explanation:
Discussing the circumstances where DBOM (Design-Build-Operate-Maintain), DBFOM (Design-Build-Finance-Operate-Maintain), and Concession Contracts may deliver value for money requires an understanding of how each procurement approach aligns with project objectives, risk allocation, and potential efficiencies.
DBOM models are beneficial when a public sector entity seeks to integrate design and construction services with long-term operations and maintenance into a single contract with a private party. This approach can deliver value for money by facilitating unified project management and ensuring long-term quality performance. For instance, a municipal government might use a DBOM contract for a new water treatment facility to ensure that the design and construction are optimized for ease of operation and maintenance.
DBFOM models add a financing component to the DBOM model. They can deliver value for money when public funds are not sufficient or available for upfront investment. Under a DBFOM arrangement, a private entity would design, finance, build, operate, and maintain infrastructure, often in return for the right to collect user fees. Toll roads are a common example where a DBFOM contract might be utilized, as the private entity can recoup its investment through toll collections.
Concession Contracts are similar to DBFOM but typically involve the private party taking on additional risks such as demand risk. They can provide value for money in cases where leveraging the expertise and efficiency of the private sector reduces risks and costs for the public entity. Airports, for example, may be developed and operated under a concession contract where the concessionaire invests in the infrastructure and operates it for a fixed term, retaining revenues generated from airport operations.