This page outlines approval requirements that apply in addition to the Budget process for Australian Government public works and capital works projects. This includes referrals to the Parliamentary Standing Committee on Public Works (the Committee) and the Two-Stage Capital Works approval process. This page highlights how officials should prepare and submit projects for assessment and approval, ensuring they align with government expectations for value, cost-effectiveness, and transparency.
Parliamentary Standing Committee on Public Works
The Committee is a joint committee with members from the House of Representatives and the Senate. Under the Public Works Committee Act 1969 (the Act) public works, by or on behalf of the Australian Government, must be referred or notified to the Committee if the project exceeds the relevant threshold unless they have been granted an exemption under the Act. An exemption may be provided in the entity's enabling legislation or through the Governor-General. Public works generally include the construction, alteration, repair, refurbishment or fit-out of buildings, infrastructure, or related land works funded by the Australian Government.
The Committee reviews public works proposals and reports its findings to the Parliament. For projects that meet the relevant threshold, parliamentary approval is required before works can proceed. Officials must not commit to works until that approval has been given.
For the Parliament to provide approval, the Committee must consider other approvals such as environmental and heritage approvals in addition to the purpose, need, scope, cost effectiveness, any expected revenue and the current and future public value of the proposed works. The Committee will report its findings to both Houses of Parliament.
Public works must be referred to the Committee where they meet the following thresholds:
- For non–defence purposes, public works exceeding $15 million (goods and services tax (GST) exclusive)
- For defence purposes, public works exceeding $75 million (GST exclusive).
Public works requiring referral must not commence until the Committee has considered them and reported to both Houses of Parliament, and an Expediency Motion has been moved in the House of Representatives.
Public works must be notified to the Committee as medium works where they meet the following thresholds:
- For non-defence purposes, public works with an estimated cost between $5 million and $15 million (GST exclusive)
- For defence purposes, public works with an estimated cost between $5 million and $75 million (GST exclusive).
For medium works, officials must notify the Committee in writing using the template provided in the Committee’s procedure manual. Medium works may not proceed until the Committee has provided its approval in writing.
Notifications must be submitted to the Public Works Secretariat at pwc@aph.gov.au and copied to Finance at publicworks@finance.gov.au.
Some major works may be exempt from the Committee's review where the work is:
- urgent
- for defence purposes and disclosure would be contrary to the public interest
- repetitive in nature.
If entities consider that works may meet the criteria for exemption, they should contact Finance at publicworks@finance.gov.au in the first instance to discuss the required approvals.
Entities should notify publicworks@finance.gov.au as soon as they identify a public works project that may require referral to the Committee. Early engagement with Finance is encouraged to support project planning and to ensure awareness of the proposed requirements.
Before formally referring a project to the Committee or submitting a medium works notification, entities should have obtained, or be close to obtaining, all relevant approvals including:
- budget and policy approvals
- environmental approvals under the Environmental Protection and Biodiversity Conservation Act 1999, or confirmation that no further assessment is required.
Officials are encouraged to engage early with Finance and the Committee Secretariat when preparing submissions. Finance can provide advice on the referral process, assist with draft submissions, and manage exemption requests.
Minister for Finance
The Minister for Finance is responsible for the administration of the Act.
Referral motions can be moved in the Senate or the House of Representatives, and expediency motions are moved in the House of Representatives by the Minister for Finance or a ministerial representative.
The Department of Finance
Finance prepares referral and expediency motions, manages exemption requests, and briefs the Minister for Finance on projects referred to the Committee.
For further guidance on referral thresholds, submission content, notification requirements, inquiry processes and Committee expectations, see Committee’s procedure manual.
Two-Stage Capital Works approval process
The approval process for Two-Stage Capital Works provides a clear approach of a proposed capital works project to reduce risk and increase cost certainty. This supports:
- the Australian Government to achieve maximum value for money in the investment, including using funds in the most effective, economical, ethical and efficient manner
- Entities are to follow the approved scope of the capital work and budget.
New Policy Proposals (NPPs) with an estimated whole-of-life cost (WoLC) of $50 million or more (excluding fit‑out) are expected to follow the Two-Stage Capital Works approval process.
Where a capital works project is large in scope, officials should not divide it into smaller components for the purpose of bypassing the approval process.
Entities undertaking significant capital works, including projects involving the acquisition of property or property remediation on behalf of the Australian Government, should apply the Two-Stage Capital Works approval process. The process supports the progressive development of project scope, cost, risk and delivery strategies, and provides assurance that key decisions are informed by appropriate analysis before significant expenditure is committed.
For further information, refer to the Budget Process Operational Rules (BPORs).
Finance provides entities with guidance and responds to any questions on the Two-Stage Capital Works Approval Process. Finance can be contacted at capitalworks@finance.gov.au.
Defence projects
The Department of Defence maintains its own Two Stage Capital Works Approval Process through the Major Capital Equipment Projects and the Defence Integrated Investment Program as part of the Portfolio Budget Submission process. This also includes updates to the government twice a year.
The BPORs apply to Defence capital works proposals that fall outside this context.
The First Stage approval process seeks the Government’s in-principle agreement for the capital works project and secure funding to develop a Detailed Business Case (DBC) to be considered further by the government.
The First Stage approval process involves developing:
- a strategic assessment
- an Initial Business Case (IBC) and NPP as part of the Budget process.
When developing the IBC and NPP non-corporate Commonwealth entities must use WoLC estimates (GST inclusive) calculated at the P50 confidence level (50 per cent confidence level). The Defining P50 and P80 Manual can help in calculating WoLC estimates at this level.
All options considered in the IBC must be comparable and assessed objectively and consistently.
Once the IBC is developed, the entity can seek First Stage approval. Please note that submission of the IBC does not guarantee or constitute approval to proceed with the capital works project.
The Second Stage approval process seeks government approval and funding for implementing and delivering the capital works project consistent with the DBC.
The Second Stage approval process involves the entity developing the DBC and NPP.
When developing the DBC and NPP, officials are encouraged to use WoLC estimates (GST inclusive) calculated at the P80 confidence level (80 per cent confidence level). All options presented in an IBC must be comparable and assessed objectively and consistently. The same approach should be applied in a DBC as a matter of good practice.
Once the above documents are developed, the entity can seek Second Stage approval. Entities should consider Budget process requirements when planning the development of the DBC and supporting documentation, particularly where Government approval of funding is sought. The timing of the Second Stage approval process is dependent on the complexity of the project and time required to develop the necessary evidence and approvals.
