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Better Regulation of Public-Private Partnerships for Transport Infrastructure

image of Better Regulation of Public-Private Partnerships for Transport Infrastructure

Many governments seek to attract private finance for infrastructure through public-private partnerships (PPPs) in order to maintain investment at the same time as limiting public spending. Experience with PPPs has, however, been mixed. Some transport PPP projects have delivered major cost savings but many more have exceeded their budgets. PPPs are prone to overestimating revenues and when projects run into financial difficulty, risks have a tendency to revert to the

taxpayer.

The report examines the nature of risks and uncertainty associated with different types of PPP project and the practical consequences of transferring risks to private partners. It assesses the fiscal impact of PPPs and discusses budget procedures and accounting rules to limit the public liabilities they can create. The report also reviews the relative merits of tolls, availability payments and regulated asset base models for attracting finance for public infrastructure from private investors on a sustainable basis.

English French

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Summary and conclusions

International Transport Forum

This section summarises the findings of the report and focuses on actuarial, structural and behavioural approaches to improving the regulation of public-private partnerships (PPPs) and containing liabilities created by PPPs for public finance. It examines the potential for private financing of infrastructure through a range of partnership models. The report aims to clarify the objectives of PPPs, their impact on public finance and the different types of risk that need to be managed, particularly in relation to forecasting traffic and revenues.

English French

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