According to the new World Bank Group’s Benchmarking PPP Procurement 2017 report, many economies are yet to adopt broadly recognised good practices to prepare, procure and manage Public-Private Partnerships (PPP).
When designed well and implemented in a balanced regulatory environment, PPPs can bring greater efficiency and sustainability in providing public services such as healthcare, telecommunications and education. In some cases, PPPs can bring benefit by leveraging the management capacity, innovation and expertise of the private sector.
The new report flags potential improvements that can help governments fill the gap in an effort to provide better PPP procurement and enable better infrastructure service delivery to all.
The report benchmarks government capabilities in 82 economies, including South Africa, across four key areas: PPP preparation, PPP procurement, unsolicited proposals and PPP contract management.
Across the four areas measured, the data finds that most economies fall short of recognised good practices. Project preparation and contract management are the two areas where a significant number of countries perform poorly. The average performance of each of the categories varies across regions and income level, with the Organisation for Economic Co-operation and Development (OECD) high- income economies and the Latin America and Caribbean region performing on or above average.
“The report aims to inform decision-making on the design of PPP procurement policies and regulations by comparing economies to recognised good practices that ensure transparency and encourage fair competition,” said Senior Economist at the World Bank Group, Fernanda Ruiz Nunez.
“There is considerable scope to improve practices around PPPs, including around disclosure of information,” continued Nunez.
The report highlights that a transparent information system is essential to monitor and manage PPP contracts. Nonetheless, only 16% of the economies measured require data to be publicly available. Even though South Africa fares well overall in the report (SA’s profile is found on page 123 of the 166 page document), it shows that the country doesn’t publish PPP contracts.
“This benchmarking exercise is the first attempt to collect and present systematic data on PPP procurement on a large scale by providing comparable data on the regulatory frameworks governing the processes,” said Senior Private Sector Development Specialist at the World Bank Group, Tania Ghossein.
“It analyses the regulatory framework at the national level using a highway transport project as a case study for comparison purposes and presents a picture as of the end of March 2016,”continued Ghossein.