A number of Australian state governments have adopted systematic programmes based on the Private Finance Initiative. The first, and the model for most others, is Partnerships Victoria. While some PPP projects have proceeded smoothly, others have been highly controversial. Australian examples include the Airport Link, the Cross City Tunnel, [1] and the Sydney Harbour Tunnel, all in Sydney; the Southern Cross station redevelopment in Melbourne; and the Robina hospital in Queensland.
In the 2010s, the States of New South Wales, Queensland and Victoria implemented policies to encourage market-led proposals, where potential private partners can pitch PS projects for consideration by the government. [2]
In Bangladesh, the Infrastructure Investment Facilitation Center facilitates private sector investment. As a result of their efforts, the telecom sector has become a very active private investment area. [3]
In Canada, public–private partnerships have become significant in both social and infrastructure development. PPP Canada Inc. was created as a Crown corporation with an independent board of directors reporting through the Minister of Finance to Parliament. Its mandate is to improve the delivery of public infrastructure by achieving better value, timeliness and accountability to taxpayers, through P3s. The Corporation became operational in February 2009 with the appointments of a chair of the board of directors and a chief executive officer.[ citation needed ]
PPPs exist in a variety of forms in British Columbia through the focused efforts of Partnerships BC, a company registered under the Business Corporations Act, that is wholly owned by the province of British Columbia and reports to its shareholder the Minister of Finance. Projects include the Canada Line rapid transit line, the Abbotsford Hospital and Cancer Centre and the Sea-to-Sky Highway project. [4] In Quebec, PPPs include the McGill University Health Centre, the new western extension of Autoroute 30 and Université de Montréal's Hospital Research Center.
There are more than 14,000 existing P3 projects in China, totaling $2.7 trillion in aggregate value, according to the finance ministry. [5] [6]
The municipal government of Shantou, China signed a 50-billion RMB PPP agreement with the CITIC group to develop a massive residential project spanning an area of 168 square kilometers, locating on the southern district of the city's central business district. [7] The project includes real estate development, infrastructure construction including a cross-harbor tunnel, and industry developments. The project, named Shantou Coastal New Town, aims itself to be a high-end cultural, leisure, business hub of the East Guangdong area.
The European Commission sees Investments in public-sector infrastructure are seen as an important means of maintaining economic activity. [8] As a result of this increase in the role played by PPPs in new public-sector infrastructure projects and the complexity of PPP contracts, the European PPP Expertise Centre (EPEC) was established to support the public sector's capacity to implement PPPs and help overcome problems common across Europe in PPPs. [9]
From 1990 to 2009, nearly 1,400 PPP deals were signed in the European Union, representing a capital value of approximately €260 billion. [10] On the onset of the financial crisis in 2008, estimates suggest that the number of PPP deals closed has fallen more than 40 percent that year. [11] [12]
A study, conducted by the European Court of Auditors of the European Union, examined 12 public-private partnerships in France, Greece, Ireland and Spain, in road transport and information and communications technology. It concluded that the partnerships were characterized by "widespread shortcomings and limited benefits" and underlined "considerable inefficiencies in the form of delays during construction and major cost increases". [13]
The Greek Inter-Ministerial PPP Committee authorized two Public-Private Partnership projects in September 2017 and October 2018, including eight schools in the Cretan Municipality of Chania and 13 schools on the island of Rhodes. [14] [15]
The Netherlands Financial Sector Development Exchange (NFX) is a platform of ING, Rabobank, ABN AMRO, Fortis, Triodos Bank, FMO (Dutch development bank) and the Dutch Ministries of Foreign Affairs, Economic Affairs and Finance to stimulate financial sector development in developing countries and emerging markets. [16]
In July 2017, the Polish Council of Ministers approved the Policy for the Development of Public-Private Partnerships. [17] [18] In 2019, the Ministry offered public authorities with information and guidance on public-private partnerships. Poland is developing PPP Guidelines, following the path of the UK and other nations burdened by PPPs. In September 2018, the first installment on PPP Project Preparation was released. [17] [18]
In his paper on P3s in Spain, José Francisco Bellod Redondo notes that one of the main drivers for PFI in Spain is compliance with the fiscal restrictions imposed under the Maastricht Treaty and Stability and Growth Pact, which set concrete limits to the national debt. [19] Examples of PFI projects in Spain include Parque de Valdebebas in Madrid, Ciutat de la Justicia in Barcelona, the Autovia de Noroeste in Murcia, and the Hospital Puerta de Hierro in Majadahonda. [20]
The Government of India defines a P3 as "a partnership between a public sector entity (sponsoring authority) and a private sector entity (a legal entity in which 51% or more of equity is with the private partner/s) for the creation and/or management of infrastructure for public purpose for a specified period of time (concession period) on commercial terms and in which the private partner has been procured through a transparent and open procurement system." [21]
The union government has estimated an investment of $320 billion in infrastructure in the 10th plan. [22] The major infrastructure development projects in the Indian state of Maharashtra (more than 50%) are based on the P3 model. In the 2000s, other states such as Karnataka, Madhya Pradesh, Gujarat and Tamil Nadu also adopted this model. Sector-wise, road projects account for about 53.4% of the total projects in numbers, and 46% in terms of value. Ports come in second place and account for 8% of the total projects (21% of the total value). [23] Other sectors including power, irrigation, telecommunication, water supply and airports, have gained momentum through the P3 model. As of 2011 [update] , these sectors were expected to get an investment of Rs. 2,027,169 crore (according to 2006–2007 WPI). [24] Recent failures of the major PPPs in India, such as the Tata Mundra Ultra Mega Power Project and the Khandwa Water Supply Augmentation Project, are now questioning the ability of PPPs to deliver on the Sustainable Development Goals. [25]
In India, public–private partnerships have been extremely successful in developing infrastructure, particularly road assets under the National Highways Authority of India and Midday Meal Scheme with Akshaya Patra Foundation.[ opinion ]
In Japan since the 1980s, the third sector (第三セクター, daisan sekutā) refers to joint corporations invested in by both public and private sectors.
In rail transport terms, a third-sector railway line is a short line or network of lines operated by a small operating company jointly owned by a prefectural/municipal government and smaller private interests. Third-sector lines are generally former JR Group – or, before 1987, Japanese National Railways (JNR) – lines that have been divested from those larger companies. Most third-sector railway lines in Japan, especially those located in rural areas, operate in a somewhat similar fashion to that of community rail in the United Kingdom.
The PPP model developed in Pakistan is built around this approach, structured to provide a parallel alternatives to traditional healthcare using corporate infrastructures which has been packaged as corporate social responsibility. [26]
The Philippine Government (Filipino Pag tutulungan ng Pampubliko – at Pribadong Sektor) maintains an online list of PPP projects. [27] Wikipedia articles on specific PPP projects in the Philippines are categorized into Category:Proposed infrastructure in the Philippines.
The Philippine BOT Law, Republic Act No. 6957 has been passed on May 5, 1994, and had been subsequently amended by RA 7718 with the Revised 2022 IRR of the BOT Law in 2012. [28]
Republic Act 11966 or the PPP Code of the Philippines was signed into law on December 5, 2023. On March 21, 2024, the implementing rules and regulations was signed by Government officials led by Arsenio Balisacan at The Mega Tower, Mandaluyong. "This pivotal moment underscores the Marcos administration's commitment to its Build Better More program of building and realizing high-quality, game-changing infrastructure projects that enable socioeconomic transformation," Balisacan said. "The PPP Code and its IRR aim to strengthen and institutionalize PPPs in the country by providing a unified legal framework for all PPPs at both national and local levels," he explained. It clarifies the ambiguities in the Build–operate–transfer Law, last amended in 1994, and other existing PPP legal frameworks. [29]
Nowadays there are special laws about PPP in 69 subjects of Russian Federation. [30] But the biggest part of them are just declarations. Besides PPP in Russia is also regulated by Federal Law #115-FZ (21.07.2005) "On concessional agreements" [31] and Federal Law #94-FZ (21.07.2005) "On Procurement of Goods, Works and Services for State and Municipal Needs". [32] In some ways PPP is also regulated by Federal Law No.116-FZ (22.07.2005) "On special economic zones" [33] (in terms of providing business benefits on special territories – in the broadest sense it is a variation of PPP).
Still all those laws and documents do not cover all possible PPP forms.[ citation needed ]
In February 2013 experts rated subjects of Russian Federation according to their preparedness for implementing projects via public–private partnership. The most developed region was Saint Petersburg (with rating 7.8), the least Chukotka (rating 0.0).[ citation needed ]
By 2013 there were almost 300 public–private partnership projects in Russia. [34]
In 1992, the Conservative government of John Major in the UK introduced the PFI, [35] the first systematic program aimed at encouraging public-private partnerships. The 1992 program focused on reducing the public-sector borrowing requirement, although, as already noted, the effect on public accounts was largely illusory. The Labour government of Tony Blair, elected in 1997, expanded the PFI initiative but sought to shift the emphasis to the achievement of "value for money", mainly through an appropriate allocation of risk. However, it has since been found that many programs ran dramatically over budget and have not provided value for money for the taxpayer, with some projects costing more to cancel than to complete. An in-depth study conducted by the National Audit Office of the United Kingdom [36] concluded that the private finance initiative model had proved to be more expensive and less efficient in supporting hospitals, schools, and other public infrastructure than public financing.
In the UK, two-thirds of the London Underground PPP was taken back into public control in July 2007 after only four and a half years at an estimated cost of £2 billion and the remaining one-third was taken back into public control in May 2010 after seven and a half years for a purchase price of £310 million. [37] The government had paid advisers £180 million for structuring, negotiating and implementing the PPP and had reimbursed £275 million of bid costs to the winning bidders. [38] The 30-year PPP contract for the refurbishment of the Ministry of Defence Main Building in London was estimated to give a saving of £100,000 as compared to the £746.2 million cost of public procurement. [39] The refinancing of the Fazakerley Prison PFI contract following the completion of construction delivered an 81% gain to the private sector operator. [40] The NATS PPP saw 51% of the UK's air traffic control service transferred to the private sector; however, following the decline in air traffic after the September 11 attacks, the government and BAA Limited each invested £65 million in the private sector operator in 2003. [41]
Public-private partnerships in America have existed in one form of another since the beginning of the colonial period, as colonial charters were based on a partnership between the British Crown and a company responsible for colonisation. [42] In the United States, they mostly took the form of toll roads concessions, which emerged in the mid to late nineteenth century. [43]
In recent years, there has been interest in expanding P3s to multiple infrastructure projects, such as schools, universities, government buildings, waste and water. In the early 2000s, P3s were implemented sporadically by different States and municipalities with little federal guidance. However, during Obama's second term, multiple policies were adopted to facilitate P3 projects, and Congress passed bills in that direction with overwhelming bipartisan support. [44]
P3s were introduced in Vietnam in 2010, with the goal of attracting private investments for the country's infrastructure projects. This development was encouraged by the World Bank. [45] By 2016, Vietnam had introduced 101 P3 projects, totaling $18.5 billion. [46] In 2019, Vietnam adopted its first P3 law, which was rafted in collaboration with the United States Agency for International Development (USAID). [47]
| Country | Territory | PPP unit | Duration |
|---|---|---|---|
 Australia |  New South Wales | NSW Public–private partnerships | |
 Queensland | Projects Queensland | ||
 Victoria | Partnerships Victoria | 1999–present | |
 Bangladesh | National | Infrastructure Investment Facilitation Center | 1999–present |
| Public–Private Partnership Authority | 2010–present | ||
 Belgium |  Flanders | Flemish PPP Knowledge Center | |
 Wallonia | Financial Information Cell | ||
 Brazil | Federal | PPP Unit | |
 Bahia | PPP Unit | ||
 Espírito Santo | PPP Unit | ||
 Minas Gerais | PPP Unit | ||
 Pernambuco | PPP Unit | ||
 São Paulo | PPP Unit | ||
 Rio Grande do Sul | PPP Unit | ||
 Canada | Federal | PPP Canada | 2009–2018 |
 British Columbia | Partnerships BC | 2002–present | |
 New Brunswick | Partnerships New Brunswick [48] | ||
 Ontario | Infrastructure Ontario | 2005–present | |
 Quebec | Quebec Agency for Public–Private Partnerships [49] | 2004–2009 | |
 Saskatchewan | Saskbuilds | 2012–present | |
 China | National | Public–private partnerships Center | |
 Hong Kong | Hong Kong Efficiency Unit | ||
 Croatia | National | Agency for Public–Private Partnerships | |
 Czech Republic | National | PPP Association | |
 Denmark | National | Danish Business Authority | |
 Egypt | National | PPP Central Unit | |
 Estonia | National | Public Procurement Center | |
 France | National | Mission d'Appui aux Partenariats Public–Privés | 2004–2017 |
 Germany |  Lower Saxony | PPP Task Force | |
 North Rhine-Westphalia | PPP Task Force | ||
 Ghana | National | PPP Advisory Units | |
 Greece | National | Secret Secretariat for PPPs | |
 Honduras | National | Commission for the Promotion of Public–Private Partnerships | |
 Hungary | National | Hungary Central PPP Unit | 2003–present |
 Ireland | National | Central PPP Policy Unit | |
 Israel | National | PPP Unit (Ministry of Finance) | |
 India | Federal | Department of Economic Affairs PPP Cell | 2006–present |
| Andhra Pradesh | Urban Finance and Infrastructure | ||
| Assam | Assam PPP | ||
| Bihar | Infrastructure Development Authority | ||
| Karnataka | Infrastructure Development Department | ||
| Maharashtra | Region Development Authority | ||
| Odisha | PPP Unit | ||
| Punjab | Infrastructure Development Board | ||
| Uttarakhand | PPP cell | ||
 Indonesia | Federal | Indonesia Infrastructure Guarantee Fund | |
| PPP Directorate of Bappenas | |||
 Italy | National | Project Finance technical unit | |
 Jamaica | National | National Investment Bank of Jamaica | 1980–present |
 Japan | National | PFI Promotion Office | |
 Kazakhstan | National | Kazakhstan PPP Center | |
 Kenya | National | PPP Unit | |
 Kosovo | National | Partnership Kosovo | |
 Kuwait | National | Partnerships Technical Bureau | |
 Latvia | National | Central Finance and Contracting Agency | |
 Lebanon | National | Higher Council for Privatization and Partnerships | |
 Malawi | National | Public Private Partnership Commission | |
 Malaysia | National | PPP Unit | |
 Mauritius | National | PPP Unit | |
 Mexico | Federal + Regional | Program for the Promotion of Public–Private Partnerships in Mexican States | 2007–present |
 Namibia | National | PPP Unit | |
 Nigeria | National | Infrastructure Concession Regulatory Commission | |
 New Zealand | National | National Infrastructure Unit | |
 Pakistan | Federal | Private Power Infrastructure Board | |
| Infrastructure Project Development Facility | |||
 Punjab | PPP Cell | ||
 Sindh | PPP Unit | ||
 Peru | National | ProInversion | |
 Philippines | National | Public-Private Partnership Center (PPP Center) | 1999–present |
 Poland | National | The department for PPP in the Ministry of Funds and Regional Policy | |
 Portugal | National | Project Monitoring Technical Unit | 2012–present |
 Russia | Federal | PPP Development Center | |
 Senegal | National | Agence nationale chargée de la promotion des investissements et des grands travaux | |
| Unité Nationale d'Appui aux Partenariats Public–Privés | |||
 Serbia | National | Commission for Public Private Partnerships | |
 South Africa | Federal | South African Treasury PPP Unit | 2000–present |
 South Korea | National | Private Infrastructure Investment Management Centre | 2005–present |
 Sri Lanka | National | Utilities Commission of Sri Lanka, Board of Investment | |
 Uganda | National | PPP Unit (MoFPED) | |
 United Arab Emirates |  Dubai | PPP Unit | 2015–present |
 United Kingdom | National | Treasury Task Force for PPP | 1997–1998 |
| Partnerships UK | 1998–2011 | ||
| Local Partnerships | 2009–present | ||
| Northern Ireland | Strategic Investment Board | ||
 Scotland | Scottish Futures Trust | 2008–present | |
 United States |  Puerto Rico | PPP Authority | |
 Uruguay | National | Public–Private Participation Unit | 2009–present |
Source: World Bank [50]
The private finance initiative (PFI) was a United Kingdom government procurement policy aimed at creating "public–private partnerships" (PPPs) where private firms are contracted to complete and manage public projects. Initially launched in 1992 by Prime Minister John Major, and expanded considerably by the Blair government, PFI is part of the wider programme of privatisation and financialisation, and presented as a means for increasing accountability and efficiency for public spending.
A public–private partnership is a long-term arrangement between a government and private sector institutions. Typically, it involves private capital financing government projects and services up-front, and then drawing revenues from taxpayers and/or users for profit over the course of the PPP contract. Public–private partnerships have been implemented in multiple countries and are primarily used for infrastructure projects. Although they are not compulsory, PPPs have been employed for building, equipping, operating and maintaining schools, hospitals, transport systems, and water and sewerage systems.
Build–operate–transfer (BOT) or build–own–operate–transfer (BOOT) is a form of project delivery method, usually for large-scale infrastructure projects, wherein a private entity receives a concession from the public sector to finance, design, construct, own, and operate a facility stated in the concession contract. The private entity will have the right to operate it for a set period of time. This enables the project proponent to recover its investment and operating and maintenance expenses in the project.
Project delivery methods defines the characteristics of how a construction project is designed and built and the responsibilities of the parties involved in the construction. They are used by a construction manager who is working as an agent to the owner or by the owner itself to carry-out a construction project while mitigating the risks to the scope of work, time, budget, quality and safety of the project. These risks ranges from cost overruns, time delays and conflict among the various parties.
John Laing Group plc is a British investor, developer and operator of privately financed, public sector infrastructure projects such as roads, railways, hospitals and schools through public-private partnership (PPP) and private finance initiative (PFI) arrangements. It was listed on the London Stock Exchange and was a constituent of the FTSE 250 Index prior to its acquisition of the company by the American private equity firm Kohlberg Kravis Roberts (KKR).
The Development Bank of Southern Africa (DBSA) is a development finance institution wholly owned by the Government of South Africa. The bank intends to "accelerate sustainable socio-economic development in the Southern African Development Community (SADC) by driving financial and non-financial investments in the social and economic infrastructure sectors".
Partnerships BC is British Columbia's public-private partnership unit. It is a Crown Corporation, wholly owned by the Government of British Columbia. Created in 2002, it is governed by a board of directors reporting to its sole shareholder, the Minister of Finance. It is incorporated under the British Columbia Business Corporations Act. Its threefold mandate is to facilitate the development of public-private partnerships infrastructure projects in BC, to advise the government on whether to use these partnerships and finally to evaluate their value for money.
Public/social/private partnerships are methods of co-operation between private and government bodies.
Shikun & Binui is a global business group based in Israel which operates through subsidiaries in businesses such as infrastructure, real estate, energy and concessions. Shikun & Binui's subsidiaries operate in more than twenty countries.
The Clean Water State Revolving Fund (CWSRF) is a self-perpetuating loan assistance authority for water quality improvement projects in the United States. The fund is administered by the Environmental Protection Agency and state agencies. The CWSRF, which replaced the Clean Water Act Construction Grants program, provides loans for the construction of municipal wastewater facilities and implementation of nonpoint source pollution control and estuary protection projects. Congress established the fund in the Water Quality Act of 1987. Since inception, cumulative assistance has surpassed 153.6 billion dollars as of 2021, and is continuing to grow through interest earnings, principal repayments, and leveraging.
The Scottish Futures Trust (SFT) is an executive non-departmental public body of the Scottish Government, established in September 2008 to improve public infrastructure investment. SFT operates at arm's length from the Government but works closely with the public and private sectors to deliver value-for-money on all public sector infrastructure investment across the country.
Partnerships UK plc (PUK) was a centralized unit responsible for furthering public-private partnerships in the United Kingdom. It was a public limited company formed in 2000, owned jointly by HM Treasury and the private sector. It ceased activity in 2011.
The public–private partnership is a commercial legal relationship defined by the Government of India in 2011 as "an arrangement between a statutory / government owned entity on one side and a private sector entity on the other, for the provision of public assets and/or public services, through investments being made and/or management being undertaken by the private sector entity, for a specified period of time, where there is well defined allocation of risk between the private sector and the public entity and the private entity receives performance linked payments that conform to specified and pre-determined performance standards, measurable by the public entity or its representative".
Public–private partnerships in transition economies have become increasingly popular since 1990. They are based on the experience of Public- Private Partnerships (PPPs) in developed countries since the model again became popular in the 1980s. PPP has yet to prove that it is appropriate in transition economies because of political and economic differences.
Public–private partnership in Canada is a form of alternative service delivery that involves a formal, collaborative arrangement between the public and private sectors, typically of a long-term nature. Public–private partnerships are commonly used for infrastructure projects related to healthcare, transportation, the environment, justice and correction, recreation and culture, and education.
The Infrastructure Concession Regulatory Commission (ICRC) is an agency of the Federal Government of Nigeria responsible for the development and implementation of the Public-Private Partnership (PPP) framework for the provision of infrastructure services.
Vietnam joined the World Bank Group (WBG) on 21 September 1956. Before the mid-1980s, Vietnam was one of the world's least developed countries. A series of economic and political reforms launched in 1986, known as Đổi Mới, caused Vietnam to experience rapid economic growth and development, becoming a lower middle-income country. The World Bank (WB) has maintained a development partnership with Vietnam since 1993. As of 25 March 2019, it has committed a total of US$24 billion in loans, credits, and grants to Vietnam through 165 operations and projects, 44 of which are active as of 2019 and comprise US$9 billion. With an estimated extreme poverty rate below 3% and a GDP growth rate of 7.1% in 2018, Vietnam's economy continues to show fundamental strength and is supported by robust domestic demand and export-oriented manufacturing.
Public–private partnerships are cooperative arrangements between two or more public and private sectors, typically of a long-term nature. In the United States, they mostly took the form of toll roads concessions, community post offices and urban renewal projects. In recent years, there has been interest in expanding P3s to multiple infrastructure projects, such as schools, universities, government buildings, waste and water. Reasons for expanding public-private partnership in the United States were initially cost-cutting and concerns about Public debt. In the early 2000s, P3s were implemented sporadically by different States and municipalities with little federal guidance. During Obama's second term, multiple policies were adopted to facilitate P3 projects, and Congress passed bills in that direction with overwhelming bipartisan support. My Brother's Keeper Challenge is an example of a public–private partnership. Some Private-public partnerships were carried out without incident, while others have attracted much controversy.
PPP Canada was a Crown Corporation responsible for promoting and facilitating Public-private partnerships, operating under Housing, Infrastructure and Communities Canada. It was created under Prime Minister Stephen Harper to highlight the commitment of the federal government to P3 infrastructure. PPP Canada managed the “P3 Canada fund” where provinces, territories, and municipalities could apply for funding from the federal government.
A Public–private partnership unit is an organisation responsible for promoting, facilitating and/or assessing Public-private partnerships in their territory. PPP units can be government agencies, or semi-independent organizations created with full or partial government support. Governments tend to create a PPP unit as a response to prior criticisms of the implementation of P3 projects in their country. In 2009, 50% of OECD countries had created a centralized PPP unit, and many more of these institutions exist in other countries.
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