Public Interest Performance Of Public-Private Partnerships In Urban Development

PPPs are considered an important vessel in urban development. Given the nature of the problems, the need for an integrated approach, and the interdependences between public and private actors, non-traditional operating procedures are required. However, performance of PPPs, especially in terms of impact on public interest, is disappointing. Although the goal of PPP is to create added value, also in terms of public interest, the precise relationship and effects are often not clear. Adversaries of PPP fear that public interest is endangered by PPP. The private sectorís profit seeking goals are supposed to be in conflict with public or community values. Blurring boundaries between public and private sector could also dissolve accountability, transparency, and democratic choice. Project-based partnerships, like urban development projects, might in particular be questioned in solving certain public sector problems. In our paper we try to provide some clarity on public interest as a concept. We distinguish different perspectives on public interest and point down the public interest performance issues in PPP, based on literature research. Evidence derived from the urban development sector provides us with the sectorís characteristics. Based on these characteristics we attempt to derive the most suitable perspective on the assessment of public interest in urban development and specify public interest performance indicators for urban development, with a focus on the public-private interaction process. These issues will be made clear by presenting the case of The Hague Central Station area, one of the so-called ënew key projectsí, linked with the development of the Dutch connection to the European network of high speed rail lines. Based on literature review and the case analyses we show that in complex urban development projects there is no unambiguous public interest, but a complex of diverging, potentially conflicting public interests that are often not fully clear, formulated at an abstract level and might even change due to changed circumstances (technological, economical, political). These complex projects take place in a multi-actor and multi-level arena. We argue that the characteristics of these projects imply that planning means searching for common goals and solution directions and settlements with regard to costs, risks and control mechanisms and conclude that for assessing public interest performance both process as product criteria should be used. A shift from more hierarchical steering towards so-called network steering is required although there will still be tasks where the initiating and directing role of the government canít be missed or where private parties can only be induced to the democratically desired action by means of powerful government incentives. Most research regarding the safeguarding of the public interest focuses on the structural allocation or rearrangement of tasks and responsibilities between public and private parties in so-called network-sectors, like energy distribution, public transport, etc. Our research is aimed at analyzing the way public interest can best be safeguarded at project level. There is a strong need for research on project level since in today's network society (spatial) decisions are increasingly being taken place on project level in a public-private setting. Although a lot of attention is paid towards performance in urban development projects, little empirical studies are available and the research is mainly limited to the description of developments in specific cases and partial aspects. Most PPP research focuses primarily on enhancing the financial efficacy and/or on juridical matters in stead paying attention to the best way to safeguard the public interest. The underlying research aims at increasing this insight. This will make a more profound choice for the design of the process and especially the co-operation between public and private parties in this process possible.