Public-Private Partnerships - A Component of Public Procurement System

While many in the community may remain suspicious of private sector involvement in public infrastructure, the truth is that old concept 'command and control' in the public sector are going to smashes and are being replaced by new interrelationships between government and private sector entities. The purpose of this article is to illustrate that Public Private Partnerships (PPPs) are a way of introducing very different incentives into the procurement process. The theory of PPPs suggests that incentives to productive efficiencies can be introduced into infrastructure procurement by vesting control rights with the private sector, bundling into one contract the design, construction, operation and maintenance of the facility, and by transferring the risk of cost and time overruns to the private partner.