PPP Development Stage – Identifying Constraints

5.4 How to overcome existing constraints?

While the roles and responsibilities of the private and public sector partners may differ depending on the type of project, the overall responsibility of government does not change in a PPP. A PPP is one of a number of ways to deliver public infrastructure and infrastructure services. It is not a substitute for effective governance and decision-making by government, which even in a PPP remains accountable for delivering services to the public.

Nor does private involvement relieve the government of its responsibility for ensuring that service providers take environmental and social considerations into account. To fulfil their obligations in this area, governments need to understand and respond to the needs of users and affected populations.

User demand…

…and public preferences, rather than the technical supply of urban services, must drive service supply planning. Differentiated or decentralised services may meet users’ needs more effectively than traditional, centralised systems.

Education programmes…

…may have to be undertaken to help users understand the constraints on the system, the options for addressing those constraints and the costs of different approaches to service delivery.

The development of clear rules…

…for the partnership (that is, self-regulation of the partnership) can improve partnership effectiveness in general, and partnership regulation in particular. If they are to maximise their potential, internal partnership agreements should define clearly:

• the activities of the partnership and its key objectives (which might be formulated as coverage and service delivery targets);
• the roles and responsibilities of each partner, decision procedures and internal reporting; and
• arbitration mechanisms.

Such clarity would help the partnership in building its credibility vis-à-vis the regulatory institutions and would increase its effectiveness.

Partnership dialogue…

…gives politicians and other public officials (as well as NGOs and other civil society actors) a better sense of what the PPP involves and the constraints that both the public and private sectors face. This may help temper both public pronouncements and community expectations. Where social acceptance of PPPs can be generated, the arrangement is more likely to achieve efficiency gains that should benefit all stakeholders.