PPP in Local Authorities – 2 June 2003

Trends and Predicted Forecasts

David Locke

PPP in Local Authorities – 2 June 2003 – Trends and Predicted Forecasts

Presentation Outline

4ps

Local authority PPP in context

Emerging issues

Opportunities for local government

Challenges and obstacles

Lessons learned

PPP in Local Authorities – 2 June 2003 – Trends and Predicted Forecasts

4ps Products

ProjectSupport

GatewayReviews

Skills Development

WiderPartnerships

4ps

PPP in Local Authorities – 2 June 2003 – Trends and Predicted Forecasts

Local Government PPP in Context

Currently in ProcurementTotal £17. 5 billion

PlannedTotal £12.3 billion

12

2.2

2.20.80.3

Defence Hospitals Local Government Schools Transport

4

3.3

4

3

2

PPP in Local Authorities – 2 June 2003 – Trends and Predicted Forecasts

£12 billion available until 2006

219 projects approved for funding

Nearly 120 projects signed

Some 85 projects operational

Some use of own resources

Wide range of projects – accommodation, infrastructure, ICT

PPP in Local Authorities – 2 June 2003 – Trends and Predicted Forecasts

Partnerships for ICT services

Partnering arrangements

Development partnerships

Joint venture companies

Joint boards

Other Local Authority Partnerships

PPP in Local Authorities – 2 June 2003 – Trends and Predicted Forecasts

New options for service delivery

Opportunities for step change in services

Encourages focus on outcomes and outputs

Integration of design, build and operations

Additional source of funding

Best value

Role for PFI and Partnerships

PPP in Local Authorities – 2 June 2003 – Trends and Predicted Forecasts

Emerging Issues

Value for money is proven in many sectors

Deal flow developing through bidding rounds

Project values are increasing

Bidders may avoid difficult sectors

Innovation is happening…but slowly

Projects are taking too long to deliver

Deficiencies in estimation of project costs

New joint venture approaches

PPP in Local Authorities – 2 June 2003 – Trends and Predicted Forecasts

Challenges and Obstacles

Procurement capacity in local government

Opportunities for sharing authority resources

Costing and optimism bias

Standardisation and project documentation

Design and sustainability

Revenue support arrangements

Central government arrangements

PPP in Local Authorities – 2 June 2003 – Trends and Predicted Forecasts

Lessons

Importance of sound ‘business case’

Involve private sector at an early stage

Ensure that there is capacity to deliver

Use experience from operational project directors

Prepare - understand the key stages in the process

Use advice sensibly

Be realistic – costing, timetabling, bidder requirements

David Locke

Telephone - 020 7808 1479

Fax - 020 7808 1499

E-mail - david.locke@4ps.gov.uk

Artillery HouseArtillery RowWestminsterLondonSW1P 1RT

www.4ps.gov.uk