2. Definition - what does PPP mean?
Co-operation between public sector and private companies to provide
public services and duties
Definition/
Background Model to combine structures of the public sector with knowledge of the private
Examples for PPP/ sector with mutual benefits
Overview
All parties bring in human resources, financial resources or legal/legislative
PPP for public resources to realizes common aims
buildings
PPP in economic
Co-operation covers planning/design, provision, financing and operating of
development services that were supplied by public bodies so far and are now transferred to a
private company
Conclusions/
Summary Objects and aims of PPP: to provide services more efficiently, with higher quality
and more economically than before
Intended to be a long-term, sustainable partnership with sharing of duties,
responsibilities, benefits and risks bounded by contract
PPP covers broad range of different issues, models, intensity and national levels
3. Background - why PPP?
Definition/
First ppp in Germany 15 years ago, but longer tradition in other countries
Background Increasing importance in the last years because of…
Examples for PPP/
Overview Strain on public budgets and liquidity
PPP for public Increasing budget deficits obstruct conventional ways of supplying public
buildings services and cause the need for alternative models of partnerships and
PPP in economic financing to secure provision of public services
development
Decreasing investments in public infrastructure
Conclusions/ Extent need for investments and/or restoration in different fields and on different
Summary
levels, but due to budget deficits decreasing investment power
Strain on skills, knowledge and human resources in public administrations
Due to reduction of employees
General tendency of liberalisation, deregulation and privatisation
Leads to a more intensive competition with private suppliers
4. Overview - where and how are PPP done?
Fields of application:
transportation infrastructure
Definition/
Background
public building projects/real estate development
Examples for PPP/
public transportation
Overview supply and disposal of energy, water, waste
PPP for public economic promotion and business development
buildings
IT-services
PPP in economic
development tourism promotion
Conclusions/
Summary Generel approaches:
project-related cooperation with long running time
setting up a special purpose body/corporation
5. Examples for PPP – transportation infrastructure
motorways/tunnels
• ppp used for new developments
Definition/ • built and financed by private company
Background
• concession for charging tolls
Examples for PPP/
Overview
PPP for public
buildings
PPP in economic
development airports
Conclusions/ • ppp used for new developments
Summary • either setting up a joint corporation for
building and operation
• or complete transformation to private
company with granting as concession to
charge fees
6. Examples for PPP – public building projects/real estate development
town halls
schools
Definition/ prisons
Background
• ppp used for new developments and
Examples for PPP/
renovation
Overview
• planning and design by municipality
PPP for public
buildings • built and financed by private company,
then rented
PPP in economic
development • long term contract (20 – 30 years)
Conclusions/
Summary
7. Examples for PPP – urban/city development
Site conversion
• ppp used for conversion of former
Definition/ industrial or military sites
Background • setting up a joint development corporation,
Examples for PPP/ which is responsible for planning, building,
Overview marketing
PPP for public • building plan and approval by city council
buildings
PPP in economic
development
Conclusions/
Summary
8. Examples for PPP – public transportation
Joint public transportation corporation
• public partner: city council or public utility
Definition/ company
Background • private partner: bus company
Examples for PPP/ • common management board
Overview
PPP for public
buildings
PPP in economic
development
Conclusions/
Summary
9. Examples for PPP – supply and disposal of energy, water, waste
Fields of application:
• water treatment and supply
Definition/ • waste water sewage
Background
• production and distribution of energy
Examples for PPP/ • waste collection and treatment
Overview
PPP for public
buildings
PPP in economic
development
Conclusions/
Summary
10. Examples for PPP – supply and disposal of energy, water, waste
municipality
charges
Definition/ services
Background
Examples for PPP/ residents
Overview
PPP for public
municipality
buildings
commission to supply
PPP in economic services for payment
development
charges
Conclusions/
Summary services
residents private operator
municipality
transfer of responsibility for
services
concession to charge residents
services
residents private operator
charges
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11. Examples for PPP – economic promotion and business development
Infrastructure projects
• development of business parks
Definition/ • start-up incubators
Background
Examples for PPP/
Overview
PPP for public Development and marketing corporations
buildings • setting up a joint corporation
PPP in economic • partners from private sector: banks,
development chambers of trade and commerce,
Conclusions/ business associations, single important
Summary companies
• corporation is responsible for investment
promotion, enhancing educational
facilities, cluster development and
management
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12. Examples for PPP – IT-services
Internet services
• as a comprehensive information portal for
Definition/ residents, visitors, business people
Background • as an access to e-government-services
Examples for PPP/ • requires specialised know-how, technical
Overview equipment and resources to keep it up to
PPP for public date
buildings
PPP in economic
development
Conclusions/
Summary
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13. Examples for PPP – tourism promotion
Marketing corporations
• joint financing of brochures and other
Definition/ marketing materials
Background • partners are city council, hotels, incoming-
Examples for PPP/ agents, operators of tourism-oriented
Overview facilities
PPP for public Destination management
buildings
• partnership for operating a tourist
PPP in economic information office and other infrastructures
development
• agreements on developing aims
Conclusions/ • compilation of package tours
Summary
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14. Overview - where and how are PPP done?
Fields of application:
transportation infrastructure
Definition/
Background
public building projects/real estate development
Examples for PPP/
public transportation
Overview supply and disposal of energy, water, waste
PPP for public economic promotion and business development
buildings
IT-services
PPP in economic
development tourism promotion
Conclusions/
Summary
1
15. PPP for public buildings
School buildings, town halls etc.
• partners are usually a municipality and a
building company
Definition/
Background • public body defines requirements: size,
layout, equipment etc.
Examples for PPP/
Overview • detailed planning and construction by
private company
PPP for public
buildings • private company is the owner of the
PPP in economic
building and lets building to the city council
development for agreed conditions
Conclusions/ • after running time of contract (usually 20 -
Summary 30 years) building is transferred into
municipal ownership
• most important benefit for public party:
only monthly payments to private investor
starting with the date of use instead of
financing entire sum at once
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16. PPP for public buildings
Different models according to intensity of private involvement:
• finance - build
Definition/
Background • finance - build - own - transfer
Examples for PPP/ • finance - build - own - operate - transfer
Overview private party also responsible for maintenance, facility management
PPP for public and supplementary services
buildings • design - finance - own - operate - transfer
PPP in economic common for technical facilities, e.g. sewage plants
development
Conclusions/
Summary
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17. PPP in economic development: the dortmund-project
PPP-initiative to facilitate the economic transformation of Dortmund
Definition/ number of employees
Background
Examples for PPP/
Overview
in thousands
PPP for public
buildings
PPP in economic
development
steel/
Conclusions/ mining breweries
metal
Summary
dortmund-project was set up by the city council and Thyssen-Krupp as a
separate body
Main objectives:
promotion of new focus industries (IT, microelectronics, logistics)
enhancing educational and scientific structures
development of high-quality industrial, residential and recreational areas
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18. PPP in economic development: the dortmund-project
Definition/ Steps of realisation:
Background • founded in 2000 by resolution of city council
Examples for PPP/
Overview
• setting up of a separate unit with 20 employees
PPP for public
• start of business in 2001, due to last until 2010
buildings • budget: 5 million euros per year
PPP in economic Contents of project:
development
• site development specifically designed for focus industries
Conclusions/
Summary • establishment of specialised educational facilities in cooperation with local
universities
• entrepreneurial contests to promote start-ups
• building of incubators for focus industries
• promotion abroad for investments in Dortmund
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19. PPP in Indonesia and Vietnam
Are there any models of PPP in your country?
Definition/ If no:
Background
• What are the reasons?
Examples for PPP/
Overview • Was it ever discussed?
PPP for public • Will it be possible in the future?
buildings
If yes:
PPP in economic
development • In which fields are the projects?
Conclusions/ • Who are the partners?
Summary
• What are your experiences? (benefits, problems)
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20. PPP conclusions and balance
Benefits
• projects are realised quicker
Definition/ • sometimes ppp are the only way to realise projects at all
Background
• cost reduction for public bodies (but not always!)
Examples for PPP/
Overview
• operation can be done more economically by private companies
PPP for public • economic benefit for the region itself (investments, employment) by ppp with
buildings focus on marketing issues
PPP in economic Possible problems and risks
development
• public and private partners usually have differing interests and motivations
Conclusions/
Summary • usually long term contract (20 - 30 years)
• precautions necessary to keep public control over services
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21. PPP recommendations
Long term analysis of financial effects
• PPP is not always the best solution
Definition/ • all costs of the entire life cycle must be considered
Background Careful and elaborate choice of partner necessary
Examples for PPP/
Overview
• must have adequate and sufficient financial and personnel resources
PPP for public • must have extensive experiences with ppp
buildings Detailed and comprehensive contract
PPP in economic • precautions for unpredictable problems
development
Conclusions/
• sanctions in case of not performing agreed services
Summary Assure political acceptance for ppp
• transparency in all stages of conception
• defining of benchmarks to evaluate ppp/reports on performance
Customers and users must not be forgotten
• service and quality level must be secured
• fees and prices for consumer and users must not be higher than with a
public solution
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