Public Private

Partnership
Content

 Definition
 Examples
 Costs and benefits
What is Public Private Partnership
(PPP)?
 Any projects that will be of a benefit to the public that are partly
owned by the government and partly by a private company or
individual. Neither the government or a private body has total
control over the project.

 Three types:
1. Government funded – The government provides the funding, but the
project is managed by the private sector.
2. Private sector funded – The private sector provides large required sums of
capital, but the government manages the project.
Private Finance Initiative (PFI)
Investment by private sector organizations in public sector projects
3. Government directed but with private sector finance and management –
it encourages private sector funding and management control, of public
projects.
Examples

 transport infrastructure- highways, airports, railroads, bridges and

tunnels
 Municipal and environmental infrastructure - water and wastewater
facilities.
 Public service accommodations - school buildings, prisons and
entertainment or sports facilities.
Costs
If the expertise in the partnership lies
heavily on the private side, the
government is at an inherent
disadvantage. For example, it may not
be unable to accurately assess the
proposed costs.
Profits of the projects can vary
depending on the assumed risk,
competitive level, complexity, and
volume of the project being performed.
Private sector organizations may lack
experience needed to operate large
public
sector projects, such as social housing
schemes, and failure of the scheme
could
leave vulnerable groups at risk
Benefits
High-quality standards are better
obtained and maintained through the
life-cycle of the project
Better infrastructure solutions than an
initiative that is wholly public or wholly
private. Each participant does what it
does best.
By increasing the efficiency of the
government's investment, it allows
government funds to be re-directed to
other important socio-economic areas.