A few rumours I have heard about the Victorian contract;
To make their proposal viable (financially) Pel Air had to gain approval from the Victorian Govt to allow non-priority patients to be transported on commercial (i.e Rex) flights. This does not occur with the RFDS.
The Victorian Govt has had to underwrite the financing for the new Pel Air aircraft. Again this would not occur if this was the RFDS.
The rumour that the RFDS (read BHI management) was told they would never be given a contract in Victoria again due to their (his) meddling in Metro Ambulance politics seems to be true.
Just because a tender may be cheaper does not mean they are required to accept it. I feel the RFDS would of been a much better proposition than what has been appointed as I am sure many also feel. However there seems to be a lot of maneuvering by the Govt (or factions of) to ensure that the RFDS did not get this contract back.