Steve Barclay Efficiency Unit Hong Kong Government Perspective on - - PowerPoint PPT Presentation

Steve Barclay Efficiency Unit

Hong Kong Government Perspective on PPPs 22 February 2005

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Topics Topics

PPPs in HK Issues Role of EU Projects Looking Ahead

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Private Sector Involvement Private Sector Involvement

Purchaser / Provider Agreements Contracting in Contracting out / Outsourcing Grants and subventions Purchaser / Provider Agreements Contracting in Contracting out / Outsourcing Grants and subventions Privatization / Private Sector Provision Asset sales Sales of businesses Management Buy Outs Market provision of services Withdrawal of public services Privatization / Private Sector Provision Asset sales Sales of businesses Management Buy Outs Market provision of services Withdrawal of public services Public Private Partnerships Partnership companies Private finance initiatives Joint ventures Partnership investments Franchises Public Private Partnerships Partnership companies Private finance initiatives Joint ventures Partnership investments Franchises L e v e l

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p r i v a t e s e c t

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v e m e n t

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What are What are PPPs PPPs? ?

Partnership approach

Government

Political responsibility Define requirements

Private sector

Finance Service delivery

Risk sharing

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Government Policy Government Policy

Make use of the market to provide better and more efficient services to the public

The Government will “make wider use of alternative approaches such as Pubic Private Partnerships in the delivery of large scale projects under the Public Works Programme.”, Policy Agenda of the 2004 Policy Address “... the format for private sector participation may cover design, build and operate,

• r other options involving private financing”, Budget Speech 2003

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PPPs PPPs in HK in HK

History

Extensively used for development of economic infrastructure

BOTs (tunnels) DBOs (solid waste facilities) Long term relationship Enabled by dedicated legislation Some financially free-standing, e.g. tunnels Price level subject to public scrutiny

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PPPs PPPs in HK in HK

Overview

Many services never part of public sector Long outsourcing history Public and private sector complement each other

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PPPs PPPs in HK in HK

Recent focus on PPPs

PPP

Asian financial crisis Sustained budget deficit Economic infrastructure Social programmes Exploiting Government Assets Staff reduction targets Budget cuts Overseas achievements

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Responsibilities Responsibilities

Government

Client department / bureau Treasury Branch Works departments Lands, planning, justice, etc

Legislature

Panels Public Works Sub-committee Finance Committee

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Issues Issues

“Vires” Business case Market interest

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Issues Issues

Public support

Public debate

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Issues Issues

Public support

Public debate Legislative Council buy-in

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Issues Issues

Fair, open and transparent procurement

Proper procedures and mechanisms for –

Market testing EOI / Pre-qualification exercise Request for Proposals Evaluation of proposals Negotiation with bidders

Access to information

Policy and practical guides Project development

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Role of EU Role of EU

To equip the civil service with the necessary tools

http://www.info.gov.hk/eu

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Role of EU Role of EU

Internal seminars

Concepts and actions General issues and benefits

Tapping private sector expertise

Project Finance Public Sector Comparator Overseas case studies

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Role of EU Role of EU

Exchanges with the private sector (locally and overseas)

Regular discussions Attend meetings / seminars PPP duty visits – Melbourne (June 2004); UK (April 2005) Visit facilities Meet officials, contractors, practitioners, consultants, academia and opponents ...

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PPP Projects PPP Projects

Tung Chung Cable Car Hong Kong Disneyland AsiaWorld-Expo Marine Police Headquarters

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PPP Projects PPP Projects

New projects

West Kowloon Cultural District Central Police Station

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PPP Projects PPP Projects – – Looking Ahead Looking Ahead

Potential PPPs

Water Treatment Regional poultry slaughterhouse(s) Hospital catering Solid waste management Sewage treatment Prison clusters Crematoria / columbaria Highways Sports and recreation

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Looking Ahead Looking Ahead

Challenges

Patchy awareness of opportunities Staffing Cross departmental opportunities Sharing benefits / costs

Opportunities / Potential