A global problem

The image of PPP is tainted by projects that don’t go well. Celebrating those that do is vital, says Paul Jarvis

I recently had calls with people in Ireland and New Zealand on the same day, and I was struck by how similar the conversations were with people who were literally on the other side of the world to each other (a full 12-hour time difference, in fact).

Following the now obligatory chat about what lockdown restrictions they are currently facing and how that has affected things, we started discussing the PPP industry and how the respective governments view the model and intend to use private finance to deliver the infrastructure needs that – like many countries around the world – are proposed to be the underpinning of their economic recoveries.

After the second call, I was struck by the fact that there had been a strong common theme coming through: the reluctance of those governments to fully embrace PPP for fear of the political backlash that this might cause. As one of the contacts pointed out, some authorities are now asking for structures to be created in which all elements of a PPP are contained – but it must not be called a PPP.

And both pointed out that a large part of this problem comes down to the fact that the only time a PPP project reaches the wider public conscience is when it gets into trouble. “A publicly procured project can have a problem and everyone just shrugs, accepting that’s just the way it is, but a PPP can have the exact same problem and it is used as evidence that the model doesn’t work,” said one.

We at Partnerships Bulletin have long called on all parties to celebrate their successes and highlight here projects have gone well, but in truth this needs to be done more by the public sector than by the private partners and advisors, who will be accused of simply trying to create more work and profits for themselves (never mind that these same private firms will be needed to deliver standard design-build contracts as well).

One source suggests the problem has been that it is difficult to point to a single project where people simply say ‘wow’ – and where they do, that’s not usually in relation to the funding model.

For over 20 years now, the Partnerships Awards have been providing one opportunity to shine a light on the benefits of PPP, and to highlight those schemes that delivered significant benefits to their communities.

This year’s event, having been postponed because of the Covid-19 pandemic, is now set to go ahead in December. Calling on the industry to support the hybrid, largely online event might seem self-serving, but in truth backing an opportunity like this to show how projects continue to make a difference in society is now more important than ever.

The coming years will see some difficult economic times.  Governments may well end up being forced to use private finance through a lack of alternatives. The problem with that is, when money does start to flow into public coffers once again, the reason for using a model of long-term finance, complete with long-term upkeep of the asset, will quickly be removed.

Therefore, celebrating what is good about PPP now will be critical to its long-term sustainability, regardless of future financial imperatives.

To find out more about our innovative ‘hybrid’ Partnerships Awards, click here.