Complexity of implementing public-private partnerships as an alternative funding instrument for infrastructure projects

Abstract

Government is hampered with infrastructure backlogs due to financial constraints and rapid urbanisation exacerbates this challenge. Hence, public-private partnerships (PPPs) are an emerging financing mechanism for infrastructure projects given the constraints to government finances and the inability of municipalities to increase their borrowing due to poor credit worthiness. PPPs in a simplistic form involve the private sector delivering public goods and services for a fee. The success of PPPs in some countries has led governments across the world to explore PPPs as an alternative funding instrument for infrastructure projects. Despite the promises of efficiency associated with PPPs as envisaged by New Public Management (NPM), the implementation of PPPs faces a myriad of problems. The study found that PPPs are complex, take time to conclude, the value for money is questioned and they are subjected to political interference, among other things.