Public Private Partnerships in Ireland: An Overview

This paper provides an overview of the Public Private Partnership (PPP) process in Ireland. It examines the varying degrees to which private sector capital can be mobilised to produce goods and services that are traditionally provided by the public sector. Since the government can usually finance projects at a cheaper rate than the private sector, there must be some offsetting benefits that a PPP offers in order for the project to be viable. It considers the various advantages that a PPP approach can offer, including risk transfer, faster implementation, increased efficiency and improved quality of service. The PPP process also has important National Accounts and public finance accounting implications, which centre around the ownership of the asset and the allocation of risk. Expenditure on a PPP project can be considered as a non-government outlay, and therefore will not affect the General Government Balance in the same way as normal government investment expenditure, if the private partner bears the major part of the risk involved. In theory and in practice, however, PPPs are beneficial only if it can be demonstrated that they will achieve additional value for money compared with alternative approaches.