Project Management & Public Private Partnerships

AIPM IRC Bibliography 25th March, 2004 _____________________________________________________

Introduction: Public Private Partnerships (PPPs) also known as Private Financing Initiatives (PFIs) are becoming increasingly common environments for project managers, and provide many of their own challenges to overcome for the project to be successful in the long term. This selection of articles gives a solid overview of PPPs, including several case studies, to help project managers stay on top of their game in this arena. 1. de Lemos T.Eaton D.Betts M.de Almeida L.T. Risk management in the Lusoponte concession-a case study of the two bridges in Lisbon, Portugal. International Journal of Project Management 22(1), 63-73(11). 2004. Keywords: Risk Management; Risk Management; Environmental Risk; Social Risk . Abstract: The case study of Lusoponte illustrates the concession awarded by the Portuguese government to finance, design, build and operate two bridges over the Tagus in Lisbon, Portugal. It includes an overview of the projects background and an analysis of the main risk categories stating both the actual risks encountered and the mitigation measure adopted. Throughout the project a great attention was given to whole life cycle costs, and gains in efficiency and cost control. Among the lessons that can be learned from both the public and private sector is that a complete risk management analysis must include not only the technical factors but also a realistic assessment of environmental and social risks. These were the risks that were somewhat overseen and that caused the main problems to the projects development. Quick, Roger. Long term ties: managing PPP contracts. Public Infrastructure Bulletin (Issue 2), 12-15 . 2003. Keywords: PPP; private sector; public sector; contracts; partnerships. Abstract: The long-term nature of Public Private Partnerships provides significant legal and administrative challenges. The success of a PPP contract depends equally on a sound contractual framework and a true partnership relationship. This paper outlines the requirements for successfully managing these contracts. Grimsey, Darrin. The privatisation myth. Public Infrastructure Bulletin (Issue 2), 9-11. 2003. Keywords: PPPs; private sector finance; public sector; privatisation. Abstract: Debate about PPPs often lumps them with privatisations and suggests that private finance is more expensive than traditional procurement methods. This paper argues that economic facts show both objections are simply wrong. The funding equation. Public Infrastructure Bulletin (Issue 2), 19-21. 2003. Keywords: PPP; private sector; public sector; partnerships; funding. Abstract: Private investment in Australian infrastructure is still in its early days and procurement via a PPP mechanism even more so. What makes an infrastructure project attractive to private investors? Players from the debt and equity side of the process outline their positions. Cooper DF. Risk management and PPP Projects. Risk - The Good, the Bad, the Ugly - Showcase WA 2003; 2003 Aug. 29; AIPM. Perth : AIPM; 2003. Keywords: showcase 2003; WA; AIPM; conferences; risk management; risk assessment; PPPs; PFIs; BOOT. Call Number: CON 47 and CON 48 Notes: PowerPoint presentation. Abstract: Public Private Partnerships, or private financing initiatives, have become a popular way for governments to provide public sector services without expending large amounts of initial funding. A private sector entity provides a capability or service for the public, and often constructs an asset for that purpose, and the public sector pays for the delivery of the capability over an extended period - build-own-operate-transfer (BOOT) schemes and the private construction of toll roads are common examples. This talk discusses the sharing and transfer of risk in PPP and PFI arrangements, and the way in which quantitative risk analysis can be used in evaluation them. Harlo, Phil and Cunningham, Hugh. Acacia Prison: a public private partnership case study. Australian Project Manager 22(4), 7-9. 2002. Keywords: public private partnerships; alliancing; alliances; public sector; private sector; Acacia Prison; case study. Abstract: Privately funded projects allow agencies and contractors from public and private sectors to work together for effective project delivery. Garling, Phillip. Why public private partnerships are like sex. Australian Project Manager 22(4), 13-14. 2002. Keywords: public private partnerships; alliancing; alliances; public sector; private sector; Tenix. Abstract: The author outlines why he believes public private partnerships are like sex. He bases his conclusions on his experiences working with Tenix. Davis, Peter R. Relationship marketing: its potential to enhance public-private sector initiatives. Australian Project Manager 22(4), 17-18. 2002. Keywords: public private partnerships; alliancing; alliances; public sector; private sector; relationship marketing. Abstract: In an effort to obtain value for money and eliminate waste and inefficiency that are inherent in the public sector, governments throughout the world are actively encouraging the private sector to become interested in funding public infrastructure projects.

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Cunningham, Hugh. A short history of public private partnerships. Australian Project Manager 22(4), 15-16. 2002. Keywords: public private partnerships; alliancing; alliances; public sector; private sector; history. Abstract: Infrastructure is traditionally regarded as the domain of the public sector, with the government being both the provider and owner. The author looks at how this has changed over recent years.

10. Partnership brings effective project delivery. Australian Project Manager 22(4), 4-6. 2002. Keywords: public private partnerships; alliancing; alliances; public sector; private sector. Abstract: Privately funded projects allow agencies and contractors from public and private sectors to work together for effective project delivery. 11. Merrifield, A., Manchidi, T. E., and Allen, S. The Asset Procurement and Operating Partnership system (APOPS) for prisons in South Africa. International Journal of Project Management 20(8), 575-582. 2002. Keywords: international projects; processes; procedures; procurement; change management; infrastucture development; developing countries. Abstract: The global shift from public to private financing of infrastructure development has led to a search for alternative and innovative procurement techniques. A public-private partnership is one innovative procurement strategy for infrastructure development. When the process described in this paper was initially developed, public-private partnerships for infrastructure delivery was a new concept in South Africa. The Department of Public Works (DPW0, South Africa, developed the framework for Asset Procurement requirements, yet maintain the clear accountability of state ownership and embrace the capital efficiency savings and creativity of private enterprise. This paper provides a case study of the implementation of APOPS process. Specifically, the paper examines the project management procedures and the difficulties faced in procuring infrastructure using public-private partnership in a developing country. 12. Ng, S. T., Rose, T. M., Mak, M., and Chen, S. E. Problematic issues associated with project partnering - the contractor perspective. International Journal of Project Management 20(6), 437-449. 2002. Keywords: Contract failure; Problematic issues; Project partnering; Public private partnerships; Public sector. Abstract: The use of project partnering is becoming more frequent in Australian Government construction projects because of the potential benefits that can be achieved from the effective implementation of the project partnering arrangement. Despite this, project partnering is not always successful. The aim of this paper is to identify the problematic issues associated with project partnering based on contractors perceptions. Fifteen problematic issues were identified from six contractors involved in unsuccessful project partnering relationships. The results indicate that the unwillingness of the client to fully commit to the partnering agreement was the main reason for ineffective project partnering. There is need for the public clients to adapt to more flexible administrative procedures in order to improve contractors' willingness to commit to project partnering arrangements. 13. Semple B. Partnership issues uncovered. Public private partnership National Air Traffic Service. A case study. Strategies for successful project delivery. Project Challenge 2002; 2002 May 1; AIPM. UK: Association for Project Management; 2002. Keywords: Project Management; Conference; Project Delivery; Aviation; PPP; Public Private Partnerships; Public Sector. Call Number: CON 35 Notes: 2 volumes. 14. Grimsey D, Lewis MK. Evaluating the risks of public private partnerships for infrastructure projects. International Journal of Project Management 2002;20(2):107-18. Keywords: Public Private Partnerships; Infrastructure; Project Finance; Risk Analysis. Abstract: In many countries, limitations upon the public funds available for infrastructure have led governments to invite private sector entities to enter into long term contractual agreements for the financing, construction and/or operation of capital intensive projects. For the public procurer, there is an obvious need to ensure that value-for-money has been achieved. To the project sponsors, such ventures are characterised by low equity in the project vehicle and a reliance on direct revenues to cover operating and capital costs, and service debt finance provided by banks and other financiers. Risk evaluation is complex, requiring the analysis of risk from the different perspectives of the public and private sector entities. This paper analyses the principles involved, drawing on practical experience of evaluating such projects to present a framework for assessing risks, and using as illustrations a case study of a waste water treatment facility in Scotland which is typical of most PPP projects. 15. NSW Government. Working with government. Policy for privately financed projects. 2001. Keywords: PFP; Privately Financed Projects; Working with Government; NSW; Public Sector; Private Sector; Infrastructure Finance. Call Number: ART 151 16. Learning by example. Project 2001;14(5):18-9. Keywords: contracts; controls; partnering; best value; tenders. Abstract: Partnering, best value and rethinking construction are by now familiar phrases to anybody involved in construction in both the public and private sectors. At Durham County Council they believe that they have created a first by putting all these principles into practice through a new form of partnership working.

17. Mohamed S, McCowan Alison K. Modelling project investment decisions under uncertainty using possibility theory. International Journal of Project Management 2001;19(4):231-41. Keywords: Investment Options; Project Selection; Possibility Distribution; Risk and Uncertainty; Monetary Factors. Abstract: With the increasing popularity of privately financed and operated construction projects, a systematic evaluation of investment options is needed, especially if they are competing for the same capital resource. Traditional evaluation methods incorporating risk analysis techniques require the input of relative frequencies which are not easily available in construction. This paper proposes a method capable of modelling the effects of both monetary and non monetary aspects of an investment option, using interval mathematics and possibility theory to handle the inherent uncertainty associated with such aspects. Two numerical examples are presented to demonstrate its application in the assessment and ranking of available investment options. 18. Ellis J. The benefits of good FM. Project 2000-2001;13(7):12. Keywords: Outsourcing; Facilities Management; FM. Abstract: Total facilities management (FM) has come of age as companies appreciate the potential for improved efficiency and cost advantages in outsourcing the management of all but its core activities to a single service provider. FM is also now accepted as an integral component of consortia bidding for the big, long term PFI and PPP contracts. 19. Boyce D. Top of the class. Project 2000-2001;13(7):21. Keywords: Outsourcing; Education; Secondary Schools; Glasgow; UK. Abstract: The report on Glasgow's secondary schools was poor. After examining the options, the City Council voted to outsource a massive refurbishment and rebuilding programme, a 30 year facilities management and maintenance contract and the provision of IT network learning in every school which will be unrivalled by any other city in the world. It is the biggest educational public-private partnership contract of its kind in the UK, designed to put the city's secondary schools at the top of the class. 20. Morrison N. Traveller's Cheques. Project 2000;13(3):19-21. Keywords: Transport/Funding/Rail Transport/A13 Thames Gateway. Abstract: Transport in the UK has been enjoying something or a renaissance, driven by the likes of rail privatisation, PFI road schemes and urban mass transit schemes. Looks at how such projects are funded, focusing on the A13 Thames Gateway. 21. Simmons D. Taking the initiative: the role of PFI in the development, procurement and delivery of projects . Project 2000;12(8):15. Keywords: Project funding - Private finance initiatives. 22. Macdonald D. Unlocking education's potential. Project 2000;12(8):16-7. Keywords: Project funding - Private finance initiatives - Public private partnership - School buildings - Repairs. 23. Williams R, Smylie I, Kirkpatrick D. Private sector program management services for public sector capital works - a case study. Prosperity through Partnership. World Project Management Week. Incorporating Project Management Global Conference; 2000 Oct. 8-2000 Oct. 11; AIPM (CD-Rom). 2000. Keywords: education; contracting; partnerships; infrastructure . Abstract: In September 1997, Education Queensland engaged Brown and Root Services Asia Pacific as Program Manager for its capital works program covering the whole state. This action established a partnership between organisations which shared a common goal of improved delivery of capital works projects for EQ. The benefits that have resulted need to be considered within the context of the circumstances which led EQ to take this step. 24. Tlhase, I. What role can the private sector play in the financing of infrastructure? Outcomes-Based Management Into the New Millenium 3-5 November 1999. 99. South Africa, Project Management Institute of South Africa PMISA. Keywords: PMISA Conference; Proceedings; South Africa; Public Sector; Infrastructure; Construction. Call Number: CDROM collection Abstract: This paper outlines the main mechanism through which the Public Sector can improve value for money in partnership with the Private Sector. The discussion draws heavily on United Kingdom experience with the Private Finance Initiative which proved a success in delivering higher quality and more cost-effective public services, by encouraging partnerships and involving the private sector more directly in asset provision and operation. The paper briefly touches on the design and implementation of new regulatory systems which will pose big challenges for both the public and private sectors and further highlights the means by which local authorities can work in partnership with the private sector through joint ventures. It also gives a detailed explanation of options appraisal and the Outline Business Case (OBC) which forms the basis for entering into a public private partnership contract concession. 25. Sorensen P. Adapting project oversight in public-private partnering projects. Tides of Change '98 PMI. Proceedings of the 29th Annual Project Management Institute 1998 Seminars and Symposiums; AIPM. PMI; 1998. Keywords: Government; Partnering; Partnership; Project Oversight. 26. Gupta JP, Sravat AK. Development and project financing of private power projects in developing countries: a case study of India. International Journal of Project Management 1998;16(2):99. Keywords: Utilities - Power projects - Privatisation - Finance -Risk - Dabhol power project - India. ______________________________________________________________________________________________________

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