How to successfully manage P3 risk transfer

Our latest report looks into assessing risk and how and when different elements of a project should be transferred from the public sector to a private partner

A major misconception surrounding private finance in infrastructure projects is the role of risk. Some mistakenly view private sector involvement solely as a means to access additional funds. While leveraging private investment to extend limited public resources is a key aspect of public-private partnerships, the real game-changer lies in risk transfer.

Shifting risk from the public sector to private partners offers advantages. It unveils the true cost and value of a project, a clarity often lacking in solely publicly funded schemes. This enables better-informed decision-making, fosters smarter client agencies, and clarifies potential outcomes from various investments.

But, an overly enthusiastic embrace of risk transfer can compromise its value for money. Striking the right balance is essential. This report looks into the decades of effort that have gone into determining which risks are best retained and mitigated by the public sector and which can be more efficiently managed by private partners, thus optimizing infrastructure delivery.

 Read the full report here