Dutch agency to review PPP bid costs

Dutch infrastructure procurement agency Rijkswaterstaat is to establish a working group to examine how to reduce transaction costs for PPP contracts.

The agency has revealed that many market participants see the high transaction costs in a design, build, finance and maintain (DBFM) tender – the standard form of a Dutch PPP contract – as a major drawback.

The agency has teamed up with Bouwend Nederland (Building Netherlands), an advocacy association that represents Dutch contractors, to run a workshop at a convention in Rotterdam with an agreement on reducing the costs of bidding expected to be the outcome. 

During the workshop on 21 January, market participants will think about how Rijkswaterstaat can reduce costs. The working group will look at how documents such as plans of action or a project management plan are necessary to select the best offer.

"Everyone agrees that the transaction costs are too high," said Carlita Fish, a purchasing manager at Rijkswaterstaat.

Rijkswaterstaat is part of the Ministry of Infrastructure and the Environment and responsible for the design, construction, management and maintenance of the road and water networks.

This month Rijkswaterstaat awarded the construction of the new Limmel lock in the Juliana Canal near Maastricht to a consortium of BESIX, Rebel and Egemin. The BESIX led team is responsible for the design, construction, financing and maintenance for 30 years of a new dike to replace the nearly 100 year old sluice. Financial close is expected in early 2015.

Construction is expected to start in mid-2015 and be completed in 2018.

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