INFRACAST

What is the right level of private sector participation? | Frank Beckers - Symbulos Management Consultancy

January 18, 2021

Following the publication of “Know your options” Frank joined us to discuss what level of private sector participation a government can and should have in delivering long-term infrastructure projects.

Key takeaways

  • Although ‘Traditional’ models are compared to PPP, all models involve some level of private sector participation. This begs the question: What is the right level of participation for a specific project?
  • To find the ‘optimal’ approach, Government must first agree and rank its objectives for a project. Common objectives often include the desire to transfer risk but deliver at the lowest possible cost – these are conflicting and need to be ranked to find an optimal solution
  • The status quo must always be tested. External events (economic growth, Covid-19, new policy) result in constantly changing objectives for Government.  The right level of private sector participation two years ago may not be the right level now
  • Soft market testing can provide confidence in a new approach in a timely and efficient manner. For the cost of a coffee, potential issues with an approach can be identified early, and addressed before being released to the wider market

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