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Despite being pioneers in PFI/PPPs, UK in the recent years has been exposed to much political criticism regarding the efficiency of PPPs. While the toll-based projects had problems of continuous toll price escalation, the annuity-based projects (performance-based as in congestion-based, lane availability and active management) lacked assessment of (i) operational efficiencies and (ii) extent of improved value for money. This research used economics and policy based approach to look into the efficiency of tendering process and payment mechanisms. Within consideration of the current issues, it has delivered three introductory models on (i) payment mechanism based on partial subsidy design (ii) restructuring safety elements in RFQ and (iii) cross-sectoral regulatory framework to encourage innovation.