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

2 � Looking Ahead � PPPs in HK � Role of EU � Projects � Issues Topics Topics

3 Private Sector Involvement Private Sector Involvement Privatization / Privatization / Private Sector Provision Private Sector Provision � Asset sales � Asset sales � Sales of businesses � Sales of businesses Public Private Partnerships Public Private Partnerships � Management Buy Outs � Management Buy Outs � Partnership companies � Partnership companies � Market provision of services � Market provision of services � Private finance initiatives � Private finance initiatives � Withdrawal of public services � Withdrawal of public services � Joint ventures � Joint ventures � Partnership investments � Partnership investments � Franchises � Franchises t n Purchaser / Provider Agreements e m Purchaser / Provider Agreements e v l � Contracting in o v � Contracting in n i r o t c � Contracting out / Outsourcing e s � Contracting out / Outsourcing e t a v i � Grants and subventions r p � Grants and subventions f o l e v e L

4 What are PPPs PPPs? ? What are Partnership approach � Government � Political responsibility � Define requirements � Private sector � Finance � Service delivery Risk sharing

5 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, or other options involving private financing”, Budget Speech 2003

6 PPPs in HK in HK PPPs 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

7 PPPs in HK in HK PPPs Overview � Many services never part of public sector � Long outsourcing history � Public and private sector complement each other

8 PPPs in HK in HK PPPs Recent focus on PPPs Asian financial crisis Economic infrastructure Sustained budget deficit Staff reduction Social PPP targets programmes Budget cuts Exploiting Government Overseas Assets achievements

9 Responsibilities Responsibilities Legislature Government � Client department / bureau � Panels � Treasury Branch � Public Works Sub-committee � Works departments � Finance Committee � Lands, planning, justice, etc

10 � Market interest � Business case � “Vires” Issues Issues

11 � Public debate Public support Issues Issues

12 � Legislative Council buy-in � Public debate Public support Issues Issues

13 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

14 http://www.info.gov.hk/eu To equip the civil service with the necessary tools Role of EU Role of EU

15 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

16 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 ...

17 PPP Projects PPP Projects � Tung Chung Cable Car � Hong Kong Disneyland � AsiaWorld-Expo � Marine Police Headquarters

18 PPP Projects PPP Projects New projects � West Kowloon Cultural District � Central Police Station

19 PPP Projects – – Looking Ahead Looking Ahead PPP Projects Potential PPPs � Water Treatment � Regional poultry slaughterhouse(s) � Hospital catering � Solid waste management � Sewage treatment � Prison clusters � Crematoria / columbaria � Highways � Sports and recreation

20 Looking Ahead Looking Ahead Challenges � Patchy awareness of opportunities � Staffing � Cross departmental opportunities � Sharing benefits / costs Opportunities / Potential