Advantages And Disadvantages Of Public Private Partnership Pdf

advantages and disadvantages of public private partnership pdf

File Name: advantages and disadvantages of public private partnership .zip
Size: 22818Kb
Published: 04.07.2021

Mandatory cookies enable the main website functions. Without the aforementioned cookies the website cannot function properly. These cookies can be turned off only by changing the browser settings.

Advantages & Disadvantages of Public Private Partnership

However, the adoption and successful implementation of PPPs in the Saudi healthcare sector requires careful attention to overcome potential obstacles. This study investigates and identifies potential barriers to the successful implementation of PPPs in the Saudi healthcare sector. A pre-tested interviewer-administered questionnaire was used to collect data from 72 respondents over a two-month period. Respondents were asked to rate the degree of influence of potential key barriers using a five-point Likert scale.

The collected data was analysed using descriptive and inferential statistics. The evidence showed that the top three barriers, as rated by the respondents, were legal barriers, including delays in receiving approval and permits and law and regulation changes, environmental barriers, including lack of transparency and accountability and technological barriers, including a shortage of professionals qualified to handle PPP projects.

The barriers identified suggested that the government should ensure that PPPs are implemented in a timely manner to ensure that private sector involvement yields the intended benefits.

Furthermore, a stable legal and regulatory framework must be established that is properly and easily enforced to avoid confusing stakeholders with too many changes. It is also important to ensure that transparency and accountability measures are strengthened. This is an open access article distributed under the terms of the Creative Commons Attribution License , which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.

Data Availability: The datasets generated and analysed during the current study are not publicly available due to privacy and confidentiality agreements, as well as other restrictions. The datasets are, however, are available upon reasonable request. Hisham M Aziz contact via haziz moh. The funders had no role in study design, data collection and analysis, decision to publish, or preparation of the manuscript. One of the main duties of governments is to provide essential public services.

The provision of such services, including education, transport infrastructure and healthcare, requires adequate resources, including financial resources. Governments provide these services by building infrastructure and financing projects delivering other services to the citizenry.

When providing these services, governments face many constraints, including technical challenges because governments might be unable to provide all services effectively and efficiently and financial challenges because they do not have unlimited budgets [ 1 , 2 ]. It is, therefore, natural for governments across the globe to consider new initiatives and one increasingly common method of delivering public services is to form public-private partnerships PPPs [ 3 — 5 ].

PPPs have received much attention in the context of the development and financing of public infrastructure facilities and services in the last decade due to their inherent advantages.

This approach has been adopted by many countries for several reasons, including the need to address fiscal deficits, budgetary pressure and demand-supply gaps [ 6 ]. PPPs are commonly used to take advantage of innovations found in the private sector, lower the risks associated with the development of public sector assets and enhance the success of the development and financing of public infrastructure facilities and services for the public [ 8 ].

It is argued that PPPs have increased efficiency, the availability of resources and the sustainability of public services in several sectors, including telecommunications, water, energy, transport and health [ 9 ].

PPP adoption in the healthcare sector has increased due to the many benefits that are associated with them, both in healthcare development and management [ 10 ]. The benefits identified included overcoming the capital shortage in public sectors, reducing the risks of investment in health infrastructure, improving efficiency in service delivery through combining efforts, making use of innovations in the private sector and aligning healthcare stakeholders in meeting healthcare needs [ 8 ].

However, oil price fluctuations affect government revenue and, consequently, all sectors of the Saudi economy [ 13 ]. The private sector provides the remaining healthcare services based on a fee for service, paid for by the patient personally or through private health insurance plans [ 15 ].

Despite the substantial resources that the government is currently able to allocate to it, the healthcare system, like most publicly funded healthcare systems is increasingly under strain, caused by rapid increases in expenditure and demand while resources remain finite.

Hence, as has been recognised by both academics and international health organizations, relying solely on oil revenues to finance public healthcare services is unsustainable in the medium to long term [ 16 — 18 ]. It has been implemented with the aim of identifying the general direction, policies, goals and objectives of KSA [ 19 ]. One of the initiatives and reforms in the Saudi healthcare sector is the increase in the role of private sector participation in delivering and financing healthcare services through the utilisation of PPPs.

The adoption of PPPs in the Saudi healthcare sector, therefore, requires caution in identifying and attempting to overcome obstacles to their successful implementation in the long term. Hence, it is worth investigating and understanding how to successfully implement PPP in healthcare. This study aims to identify and classify the perceived obstacles and barriers to the successful implementation of PPPs, so that policymakers can take them into consideration as KSA implements the Vision program.

This will allow the government and other stakeholders to recognize the barriers and develop plans and solutions that will prevent them from consistently besetting progress in the healthcare sector. This research adds to the existing body of knowledge on barriers to the implementation of PPPs in the healthcare sector. Cooperation between the public and private sectors in healthcare infrastructure construction and maintenance and healthcare services delivery has been longstanding and takes various forms, from outsourcing to almost complete privatisation of services [ 20 ].

PPPs in healthcare were launched in the early s and they redefined the model of cooperation between the public and private sectors [ 7 ]. Governments introduced PPPs to improve value for money and to attract private capital to produce public goods and services.

The popularity of PPPs is also a result of the emergence of alternative instruments in public funds management focused around New Public Management [ 21 ].

As the European Commission's report indicates, there have been changes in the perception of state institutions from that of a service provider to a regulator, controller and organiser of the system for the provision of public services and goods [ 22 ].

There is no single precise definition of PPPs [ 23 — 25 ]. In practice, there are many different models of such partnerships, including institutional cooperation for joint production and risk sharing, long-term infrastructure contracts that emphasise tight specific of outputs, public policy networks, civil society and community development and urban renewal and downtown economic development [ 24 ]. PPPs have been used to encourage and facilitate innovations in many healthcare fields.

PPPs in public health research [ 27 ] have included finding vaccines against, and drugs to treat, communicable diseases [ 28 , 29 ], personalised medicine development [ 30 ] and management and infrastructure growth [ 31 , 32 ]. The biggest controversies and expectations concern building and operating healthcare infrastructure, such as hospitals.

In developed countries, PPP models based on designing, building and maintaining healthcare infrastructure prevail and the service provision is often left to the public partner [ 33 ]. However, in some solutions, healthcare services are provided in facilities owned and maintained by a public entity [ 7 ]. There are several advantages of PPPs in healthcare, including increasing efficiency, allocating risk, reducing the cost of delivery quality services, increasing accessibility, delivering services on time, adopting new technology and management, solving public sector capital shortages and reducing fiscal and public pressures [ 20 , 34 ].

It is expected that the private entity will put more effort into initial design and construction in order to optimise life-cycle costs and reduce operating and maintenance costs. The private sector also has a better incentive system [ 35 ]. A great advantage of PPPs is proper risk-sharing between the partners. There are many types of risks in healthcare contracts, including demand, demographic change, health changes, epidemiological trends, long-term healthcare demands, infrastructure construction risks, operational risks, and financial risks [ 35 ].

Proper risk-sharing is a key issue. If properly implemented, the PPP model can result in better investment decisions and can reduce the total cost of delivering services of a certain quality [ 36 — 38 ]. Such an effect could be expected in countries where the risk of corruption is very high [ 41 ]. In spite of the advantages of PPPs, their implementation still suffers from several disadvantages and impediments, including higher costs of providing goods and services, difficulty in specifying services due, for example, to innovations in medical equipment resulting in difficulty in quantifying the cost of PPP projects, political risks associated with long-term cooperation between public and private sectors, volatile and often unpredictable external conditions e.

PPPs in healthcare projects also experience many impediments that characterise other PPP investments, including lack of suitable skills and experience, lengthy bidding and negotiation processes, lack of well-established legal framework, legal risks, unfavourable economic and commercial conditions, inefficient public procurement frameworks, lack of mature financial engineering techniques, public opposition, delays because of political debate and lack of competition [ 9 , 45 ].

One of the most important issues for successful long-term PPPs is to determine and ensure robust contractual and relational governance mechanisms [ 47 ]. This is indirectly related to the type of health PPP model. For example, private finance initiative contracts are the least flexible in the longer term.

There are no incentives for the private partner to make any required changes, which could have a negative impact on the public-private relationship [ 48 ]. Accordingly, the MOH has introduced two pilot projects, one in radiology and the other in service provision [ 49 ]. These two projects are currently at the pilot stage and limited information about them is available.

The radiology project is extremely ambitious and is planned for a 10 year period. It will cover demand for radiology services from seven hospitals, as well as nuclear medicine services, serving 1 million beneficiaries. The private partner will be responsible for replacing equipment over the project term, for investing in IT infrastructure and networks to set up a tele-radiology solution and any required refurbishment.

The payment mechanism will be based on ongoing payments by the MOH and will be on a per-scan basis [ 50 ]. Such data will be extremely helpful when the MOH expands the implementation of PPPs in the healthcare sector in the future. We conducted a descriptive study to identify and map barriers to the implementation of PPPs in the Saudi healthcare sector. A pre-tested interviewer-administered questionnaire was used to collect data from 72 stakeholders involved in PPPs in the Saudi healthcare sector over a two-month period June-July The target respondents included various stakeholders from both the public and private sectors, i.

They included government leaders, public sector officials, private investors, consultants, lenders and representatives from contractors involved in PPP projects. Interviewer-administered questionnaire was used in order to accurately record responses, to make the most efficient use of time, and to avoid any missing data. The sample was purposively selected to gather the insights of a varied group of people.

The questionnaires were administered in the Arabic language by the author SA. The interviewer read, managed and completed the questionnaire based on the answers provided by the participants to record responses accurately and make the most efficient use of time.

The interviews lasted between 15—30 minutes, with an average length of 21 minutes. The interviewer-administered questionnaire guide was adapted from the validated questionnaires developed by Babatunde et al. The questionnaire included two main sections. The first section asked the respondents for general information related to their demographic characteristics and PPP project knowledge and experience. The second section was designed to investigate barriers to the successful implementation of PPPs in the Saudi healthcare sector.

The SLEEPT approach is a verified tool providing in-depth analysis of business environments, enabling business and political leaders to build a more efficient and effective system of delivering public goods and services, such as healthcare provisions.

Additional informed consent was obtained from all individuals whose identifying information was included in this article. Descriptive and inferential analyses were used to evaluate data regarding the various barriers and their perceived degree of importance. The measurements of descriptive statistics used in this study included percentages, averages and mean scores, which were used to interpret the distribution of the samples.

The Kruskal-Wallis test was employed to draw inferences from the data as it is a suitable statistical tool when comparing three or more groups [ 52 ].

Here, the Kruskal-Wallis test was conducted to determine whether there were significant differences in the opinions of various stakeholders involved in healthcare-related PPP projects regarding the barriers to the successful implementation of PPPs. Based on these values, the study tool appeared to possess internal reliability. The study was designed and conducted in accordance with the ethical principles established by King Abdulaziz University.

Written consent to participate was secured from all respondents who participated in the study. Details of the statements and their ranking list based on their mean values are presented in Table 3. Legal barriers had the highest mean value, with a score of 3. This shows that the stakeholders perceived legal barriers to be the biggest hindrance to PPP project implementation in the Saudi healthcare sector, followed by environmental, technological, economic, social and political barriers, respectively.

Delays in approval were considered the biggest legal barrier, with a mean value of 4. Among environmental barriers, lack of transparency and accountability and lengthy delays in negotiations were considered the leading environmental barriers. The shortage of professionals qualified to handle PPP projects and lack of clarity in the process of implementing PPPs were identified as the two biggest technological barriers, with mean values of 3. Issues with delays in receiving payments and the inability of local institutions to provide long-term financing ranked as the biggest economic barriers, with mean values of 3.

Potential conflicts of interests among stakeholders had the highest mean value, 3.

Public-Private Partnerships

Higher growth of national economies in recent years have led to unprecedented demand for infrastructure services which are essential for producing goods and services and for maintaining supply and distribution chains efficient, reliable and cost-effective. PPPs have become important, since available funding from traditional sources in most countries falls far short of the infrastructure financing needs. However, availability of private funding or interest of the private sector should not be the sole criterion in considering a PPP project. There are certain additional costs of private financing, see further Module 3. There are underlying fiscal costs and contingent liabilities of PPPs to government that may arise in the medium and long term. Besides, there are many important economic, social, political, legal, and administrative aspects, which need to be carefully assessed before approval of PPPs are given by government.

Public-Private Partnership is formed for large infrastructural projects. The project undertaken under these partnerships are of huge size. Timely completion of the project is a bigger challenge. When private companies consisting of high professionals join a public corporation, it becomes possible for timely completion. The efficiency of the project is increased due to high efficient peoples in the group.


PPP Advantages and Disadvantages · Ensure the necessary investments into public sector and more effective public resources management;.


PPP Advantages and Disadvantages

A public-private partnership, or P3, is a contract between a governmental body and a private entity, with the goal of providing some public benefit, either an asset or a service. Public-private partnerships typically are long-term and involve large corporations on the private side. Popular in many European countries, P3s have gotten off to a relatively slow start in the United States, but they are increasingly used for large-scale infrastructure and public works projects. Many P3 projects in recent decades have been extremely successful. The high-occupancy toll lanes project in Virginia is a good example.

Public-Private Partnerships in Healthcare

5.4. Disadvantages and Pitfalls of the PPP Option

In addition to offering benefits and advantages, PPPs are also a procurement option, however, one that has weak spots and potential disadvantages. This does not mean that the PPP option is by definition more expensive. However, if the project is unsuitable for a PPP solution, is poorly structured, or the procurement process or the contract is poorly managed, the use of expensive private finance is unlikely to be offset by other efficiencies. This creates an unexpected extra burden in terms of affordability that is not compensated for by the efficiency savings. These features represent weak points, disadvantages and risks inherent in the PPP route. Therefore, the PPP option may not be the most appropriate for a specific project if these risks are not manageable by the government so as to substantially eliminate or mitigate them. Similarly, PPP may not be appropriate if the government does not have mechanisms of control in place for example, control of aggregated exposure and proper affordability analysis.

NCBI Bookshelf. Editors Jill Jensen , Dr. Global health programs and partnerships have historically focused on narrow, quantifiable aspects of global health challenges, especially communicable diseases on which they can make a measureable impact. While metrics over the past decade show important reductions in the top causes of mortality CDC, , low- and middle-income countries LMICs continue to require support for crumbling health systems that fail to sustain program achievements and meet the demand for additional health care priorities. In the long term, vertical programs are only as effective as the health system in which they reside Bloland et al. Lessons learned from unsustained success in disease eradication, as well as failed responses to acute health crises, demonstrate the need for an enhanced approach to global health programming. In a diagonal approach, health system strengthening HSS activities—those that support key health system functions Bloland et al.

Actively scan device characteristics for identification. Use precise geolocation data. Select personalised content. Create a personalised content profile. Measure ad performance. Select basic ads.

Benefits and Disadvantages of P3 Contracts

Public private partnership PPP refers to an arrangement between the government and the private sector, with the principal objective of providing public infrastructure, community facilities and other related services. Such long-term partnerships are characterised by a sharing of investments, risks, rewards and responsibilities for the mutual benefit of both parties involved. A survey in showed benefits of PPPs to include high quality facilities and infrastructure, with construction completed as planned, on time and within budget; staff and user satisfaction; responsiveness of the private sector; efficient development of output specifications, economies of scale, innovative technologies, more flexible procurement and compensation arrangements and reduced overheads. The introduction of private-sector ownership to state-owned businesses, using the full range of possible structures and with the sale of either a majority or minority stake;. Private finance initiatives and other arrangements, where the public sector contracts to purchase quality services on a long-term basis so as to take advantage of private sector management skills incentivised by having private finance at risk, and. Selling government services to wider markets and other partnership arrangements where private sector expertise and finance are used to exploit the commercial potential of government assets, for example, through the various types of PPPs. Adopting PPP.

Definition : Public-private partnership PPP is a model where the government associates with private companies to accomplish infrastructure projects. This alliance between both the parties, ensure financing, designing, flourishing and maintaining of the infrastructural amenities within the country. The PPP approach initiates the efficient facilitation of public goods to the people. This is because, such projects are handed over to the relevant private entities, who hold expertise and knowledge in their field. To understand the PPP concept, we must know its fundamental characteristics. Some of these are discussed in detail below:.

However, the adoption and successful implementation of PPPs in the Saudi healthcare sector requires careful attention to overcome potential obstacles. This study investigates and identifies potential barriers to the successful implementation of PPPs in the Saudi healthcare sector. A pre-tested interviewer-administered questionnaire was used to collect data from 72 respondents over a two-month period. Respondents were asked to rate the degree of influence of potential key barriers using a five-point Likert scale. The collected data was analysed using descriptive and inferential statistics. The evidence showed that the top three barriers, as rated by the respondents, were legal barriers, including delays in receiving approval and permits and law and regulation changes, environmental barriers, including lack of transparency and accountability and technological barriers, including a shortage of professionals qualified to handle PPP projects.

Этот чертов компьютер бьется над чем-то уже восемнадцать часов. Конечно же, все дело в вирусе. Чатрукьян это чувствовал.

2 COMMENTS

Maya B.

REPLY

PDF | Public-private partnership (PPP) is a means for the public sector to complete infrastructure projects by using the skills and the experience of | Find, read.

Jacqueline D.

REPLY

Public-private partnership PPP , partnership between an agency of the government and the private sector in the delivery of goods or services to the public.

LEAVE A COMMENT