Private finance for the delivery of school projects in England

This paper analyses the use of the private finance initiative (PFI) approach to deliver school projects in England. The findings are based on case-study research in the Building Schools for the Future scheme (BSF), the largest single capital investment in SO years to rebuild and renew all of England's secondary schools. Up to half of the school infrastructure is to be procured by PFI contracts. A major concern has been the high cost associated with PFI procurement and any subsequent changes to scope. Furthermore, in some cases PFI-funded schools have been closed soon after completion; at great cost to the public sector. The aim of this research was therefore to understand the underlying reasons for these problems. The main conclusion is that the difficulties in BSF arise from not sorting out strategic issues and instituting appropriate organisational frameworks before engaging the private sector. The result of this is a lack of clarity about the long-term needs and end user aspirations. A brief outline of current programme management methods is given and it is suggested that this might be integral to the successful delivery of schools using private finance. A clear strategic vision that cascades into projects via programmes will ensure that the school infrastructure is appropriate for the anticipated strategic benefits and is aligned to the overall service delivery ambitions

Once the shovel hits the ground : Evaluating the management of complex implementation processes of public-private partnership infrastructure projects with qualitative comparative analysis

Much attention is being paid to the planning of public-private partnership (PPP) infrastructure projects. The subsequent implementation phase – when the contract has been signed and the project ‘starts rolling’ – has received less attention. However, sound agreements and good intentions in project planning can easily fail in project implementation. Implementing PPP infrastructure projects is complex, but what does this complexity entail? How are projects managed, and how do public and private partners cooperate in implementation? What are effective management strategies to achieve satisfactory outcomes? This is the fi rst set of questions addressed in this thesis. Importantly, the complexity of PPP infrastructure development imposes requirements on the evaluation methods that can be applied for studying these questions. Evaluation methods that ignore complexity do not create a realistic understanding of PPP implementation processes, with the consequence that evaluations tell us little about what works and what does not, in which contexts, and why. This hampers learning from evaluations. What are the requirements for a complexity-informed evaluation method? And how does qualitative comparative analysis (QCA) meet these requirements? This is the second set of questions addressed in this thesis

Principles of project finance

The Second Edition of this best-selling introduction for practitioners uses new material and updates to describe the changing environment for project finance.  Integrating recent developments in credit markets with revised insights into making project finance deals, the second edition offers a balanced view of project financing by combining legal, contractual, scheduling, and other subjects. Its emphasis on concepts and techniques makes it critical for those who want to succeed in financing large projects.  With extensive cross-references and a comprehensive glossary, the Second Edition presents anew a guide to the principles and practical issues that can commonly cause difficulties in commercial and financial negotiations. Provides a basic introduction to project finance and its relationship with other financing techniques Describes and explains: sources of project finance; typical commercial contracts (e.g., for construction of the project and sale of its product or services) and their effects on project-finance structures; project-finance risk assessment from the points of view of lenders, investors, and other project parties; how lenders and investors evaluate the risks and returns on a project; the rôle of the public sector in public-private partnerships and other privately-financed infrastructure projects; how all these issues are dealt with in the financing agreements

The public sector's perspective on procuring public works projects - Comparing the views of practitioners in Hong Kong and Australia

Hong Kong has been one of the early jurisdictions to adopt Public Private Partnership (PPP) model for delivering large public infrastructure projects. The development of this procurement approach in Hong Kong has followed an intricate path. As such, it is believed that there are a number of areas which are interesting to unveil. As part of a comprehensive research study looking at implementing PPPs, interviews with experienced local industrial practitioners from the public sector were conducted to realize their perspective on the topic of procuring public works projects. Amongst these interviews, fourteen were launched government officials and advisers. The interview findings show that the majority of the Hong Kong and Australian interviewees had previously conducted some kind of research in the field of PPP. Both groups of interviewees agreed that “PPPs gain private sector’s added efficiency/expertise/management skills” when compared to projects procured traditionally. Also, both groups of interviewees felt that projects best suited to use PPP are those that have an “Economic business case”. The interviewees believed that “Contractor’s performance” could be used as key performance indicators for PPP projects. A large number of critical success factors were identified by the interviewees for PPP projects; two of these were similar for both groups of interviewees. These included “Project objectives well defined” and “Partnership spirit/commitment/trust”. Finally it was found that in-house guidance materials were more common in the organizations of the Australian interviewees compared to the Hong Kong ones. This paper studies the views of the public sector towards the topic of PPPs in Hong Kong and Australia, which helps to answer some of the queries that both academics and the private sector in these jurisdictions are keen to know. As a result the private sector can be more prepared when negotiating with the public sector and realise their needs better, academics on the other hand are provided a wider perspective of this topic benefiting the research industry at large

Risk Allocation in PPP Unsolicited and Solicited Proposals in Latin America: Pilot Study in Colombia

Risk management between public and private sectors is crucial for the success of public-private partnership (PPP) projects. Thus, effectively allocating project risks is a key task in the development of public-private initiatives because it is a determinant characteristic for PPP success or failure. However, despite being an important topic for scholars and practitioners, today, the academic literature does not provide ample evidence of how risks are managed in solicited and unsolicited road PPP projects. Building on a systematic content analysis framework, this case study examines the allocation of risks in three unsolicited and three solicited highway PPP contracts over the last decade in Colombia. The framework was developed through line-by-line coding of contract provisions associated with risk-related issues. Results show that some risks were shared and addressed by the public sector, but the majority were transferred to the private sector. Conclusions indicate that there are two opportunistic behaviors identified, the private party who makes the unsolicited proposal seeks to transfer some endogenous risks to the public, and public agencies seek to transfer exogenous risks to the private in USPs; these changes are observed in unsolicited proposals rather than solicited proposals. Overall, this study intends to extend risk allocation studies by analyzing PPP contracts within this Latin American country