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The determinants of tendering periods for PPP procurement in the UK: an empirical analysis

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  • Eoin Reeves
  • Dónal Palcic
  • Darragh Flannery
  • R. Richard Geddes

Abstract

The procurement of infrastructure projects via public–private partnerships (PPPs) is rising globally. PPPs are, however, often characterized by lengthy tendering periods, defined as the difference between contract notice and financial close. Tendering periods are important because they account for a significant proportion of overall project delivery time. Slow tendering deters bidders and thus reduces competition for contracts. We source data on 670 PPP projects in the United Kingdom and use a duration analysis model to empirically examine factors that impact tendering period duration. Our results reveal significant sectoral variation with projects in the health and housing sectors taking significantly longer to reach financial close. We also show that, after controlling for other factors, projects with higher capital values and projects that overlap with the timing of general elections are associated with significantly longer tendering periods. We further examine the impact of the competitive dialogue procurement method and find evidence that tendering periods have increased since 2006; the year competitive dialogue was introduced. We do, however, observe a significant reduction in the time between appointment of preferred bidder and financial close post-2006. This suggests that competitive dialogue is effective in reducing the scope for negotiations by preferred bidders holding quasi-monopoly advantages.

Suggested Citation

  • Eoin Reeves & Dónal Palcic & Darragh Flannery & R. Richard Geddes, 2017. "The determinants of tendering periods for PPP procurement in the UK: an empirical analysis," Applied Economics, Taylor & Francis Journals, vol. 49(11), pages 1071-1082, March.
    • Handle: RePEc:taf:applec:v:49:y:2017:i:11:p:1071-1082
    DOI: 10.1080/00036846.2016.1210779
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    Cited by:

    1. Vicente Alcaraz Carrillo de Albornoz & Antonio Lara Galera & Juan Molina Millán & Belén Muñoz Medina, 2023. "Public–Private Partnerships: Left or Right Government Economic Policy?," Public Organization Review, Springer, vol. 23(4), pages 1523-1544, December.
    2. Erik-Hans Klijn, 2022. "Theories of public-private partnerships," Chapters, in: A Research Agenda for Public–Private Partnerships and the Governance of Infrastructure, chapter 2, pages 33-52, Edward Elgar Publishing.
    3. Hartman, Paul & Ogden, Jeff & Jackson, Ross, 2020. "Contract duration: Barrier or bridge to successful public-private partnerships?," Technology in Society, Elsevier, vol. 63(C).
    4. Daniel Albalate & Germà Bel & Eoin Reeves, 2019. "“Easier said than done: Understanding the implementation of re-municipalization decisions and associated delays.”," IREA Working Papers 201917, University of Barcelona, Research Institute of Applied Economics, revised Oct 2019.
    5. He, Chusu & Milne, Alistair & Ataullah, Ali, 2023. "What explains delays in public procurement decisions?," Economic Modelling, Elsevier, vol. 121(C).
    6. Mark A. Moore & Aidan R. Vining, 2023. "PPP performance evaluation: the social welfare goal, principal–agent theory and political economy," Policy Sciences, Springer;Society of Policy Sciences, vol. 56(2), pages 267-299, June.

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