Competition

Competition and Public-Private Partnerships

 

In the last twenty years a number of developed and developing countries around the world have used public-private partnerships in a variety of sectors, ranging from transport and utility infrastructures (e.g. bridges, roads), to social infrastructures (e.g. schools, hospitals and prisons).

A public-private partnership (PPP) involves a long-term contract between a public body and a private party for the provision of a public service, or for the development of an infrastructure, where the private party assumes substantial financial, technical and operational risk in the project. Hence public-private partnerships are very different from traditional public-private procurement because they involve not just the provision of an infrastructure, but also its operation, and they lead to some form of sharing of the demand risk between the public procurer and the private provider.

Usually public-private partnerships are undertaken to exploit synergies between the various stages of the provision process, to provide incentives to the private partners to internalise operational and maintenance costs in their investment decisions, and to benefit from private partners’ managerial capabilities and technical and sectoral know-how.

Competition delegates took part in a Hearing on Public-Private Partnerships on 16 June 2014 to examine the major benefits and drawbacks of these type of contracts, the conditions under which they are most effective in delivering value for money, how the award process can be organised to ensure an adequate level of participation by private parties and an effective selection process.

 

RELATED MATERIAL

OECD Recommendation on Public Governance of PPPs (2012)

OECD Principles for Public Governance of Public-Private Partnerships

How To Attain Value for Money: Comparing PPP and Traditional Infrastructure Public Procurement (2011)

Public-Private Partnerships and Investment in Infrastructure (2010)

Senior Budget Officials Network on Public-Private Partnerships (PPPs)

 

SEE ALSO

Other Competition Issues under Discussion

All Competition Policy Roundtables

Competition Home Page 

DOWNLOADS - JUNE 2014 SESSION DOCUMENTATION

 

Experts presentations

Public-private-partnerships and Investment in Infrastructure: Lessons from OECD countries by Sonia Araujo 

PPPs in France: What Efficiency? What Future? by Stephane Saussier

Competition Issues in Public-Private Partnerships by Elisabetta Iossa 

Public private partnerships in Italy: A snapshot of the main issues by Federico Antellini Russo

 

Experts papers

Competition Issues in Public-Private Partnerships by Elisabetta Iossa: This paper briefly discussed how these characteristics constitute the main drivers behind thepotential efficiency improvement that PPP may bring about, once an efficient private partner has been selected at competitive conditions.


Infrastructures, Public Accounts and Public-Private Partnerships: Evidence from the Italian Public Administrations by Antellini Russo, F. and Zampino, R.: This 2012 paper uses data on PPPs in Italy to determine whether this type of contracts are effectively used to profit from private firms’ experience to provide better public services or if they are mostly used to overcome periods of tight budgets and fiscal consolidation. 

 

 

 

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