PUBLIC-PRIVATE PARTNERSHIPS

Public-Private Partnerships



Public-Private Partnerships

Introduction

Public-private partnerships are commonly cited by governments, business, the press and academics as constructive, and even “cure-all,” mechanisms for development in many spheres. Public-private partnerships have risen to the forefront of development processes as the global shift toward governance has gathered momentum. As stakeholders in development have come to recognize that they are interdependent and as the search for new solutions to contemporary problems has expanded beyond the use of traditional mechanisms of government, public-private partnerships have become increasingly popular in both the developed and developing world.

While public-private partnership (PPP) is an ancient phenomenon, scholars did not pay serious attention to analyzing it before the late 1980s, probably because its use became widespread in public administration and management during those years in both developed and developing countries. Today, a large variety of PPPs are contributing to the design and implementation of public policies, and it seems there will be a strong trend for greater use of partnership in the future. Even so, there is much debate on this topic, especially regarding what constitutes a genuine PPP and also regarding the costs and benefits of partnerships.

Discussion

At first, it has to be said that partnership is one of those catchall terms that may be used to convey all kinds of different meanings. On the one hand, some people consider any kind of relationship to be a partnership, and on the other hand, some genuine partnerships may be designated by other words. In France for instance, in addition to practitioners (in the financial sector in particular), the only academics to have used the expression PPP are economists and town planning specialists. French lawyers refer more willingly to “outsourcing administration of public services” (more restrictive than PPP), and political scientists refer to the “co-production of public policy or negotiation of contractual policies” (which has a broader meaning). However, the expression PPP is becoming more generalized as the phenomenon has grown.

Although varying definitions abound, public-private partnerships are collaborations across the public and private sectors that are seen by the respective parties as facilitating greater gains than could be achieved by working separately or in conflict. They are further considered as a tool or instrument of development, enabling governments to carry out their role in a context of governance, which increasingly requires a role for many players in decision making, development, and service delivery.

Public-private partnerships can form through various motivations, such as access to capital or expertise, lack of capacity to deliver services effectively, the possibility of cost savings in a competitive service delivery environment, or as responses to shifts in government policy. These partnerships should be understood as reflections of the institutional culture and local context through which they emerge. The purpose of a partnership can be to achieve a onetime goal, perhaps a particular economic development, or they can be established to effect ongoing broader development goals, such as urban renewal, shared service delivery, or the improvement of urban economic competitiveness. Where ongoing change is the goal, these networks can form ...