Ottawa, Ontario – A new study by the Conference Board suggests that public-private partnerships (PPPs) can be a cost-effective tool for building and managing transportation infrastructure, but governments must be selective in deciding which projects are best developed this way.
“In some quarters, PPPs are viewed as the only way to build and maintain transportation infrastructure, while others are opposed to any and all forms of PPPs,” said Mario Iacobacci, Director of Research and Centre for Infrastructure. “Neither view is accurate. The merits of PPPs need to be looked at on a case-by-case basis.”
PPPs are long-term contractual arrangements, whereby a public sector entity procures the design, construction, and ongoing operation and/or maintenance of an asset, usually from a consortium of private sector firms which finances the project.
The publication, Steering a Tricky Course: Effective Public-Private Partnerships for the Provision of Transportation Infrastructure and Services, exmained the Confederation Bridge fixed link as an example of a successful PPP, and at three London Underground PPPs that exhibited serious deficiencies. The report also studied the Montreal metro extension to Laval, which was not a PPP but which the report said could have benefited from the due diligence that private financing usually provides. The report can be found at the Conference Board.