Organizing and executing PPP projects in the suitable and accurate practices are vital to guarantee infrastructural development in Ghana (see fig. 1). Furthermore, best practices in the PPP framework guarantees projects benefits to various stakeholders. There are analytical features and undertakings that prerequisite as best practices in order to promote the sustainable PPP projects in Ghana. Some of the relevant best practices identified in ensuring successful execution of projects that the article seeks to elucidate includes:
- open transparency and competitive selection process
- established legal framework
- capacity building of local PPP practitioners
- all-inclusive stakeholder engagement, and,
- appropriate shared risk allocation.
Figure 1: Essence of Best Practices
Open transparency and competitive selection process
Transparency and competitive selection process of private investors are vital to improve the various stakeholders’ positive conviction in the objective and usefulness of the identified PPP projects. Both the private and public actors involved in the PPP projects have to publicly share all relevant information in the public media to ensure open transparency process of the projects from agenda setting to execution of PPP projects (see figure 2).
We must commend the Public Investment and Asset Division (PIAD) of the Ministry of Finance (MOF) for creating a PPP portal website to frequently update the various stage of PPP projects in Ghana. The PPP portal websites also discloses all selected private investors involved in the PPP projects, thus illustrating the competitive selection of private actors to ensure value for money (VFM). The portal also shows advertisement of Proposed projects which allows investors to bid under a competitive environment. Thus, transparency and competitive selection of project is a critical success factor in the execution of PPP projects in Ghana.
Figure 2: Transparency in PPP
Established legal framework
Public Private Partnership regulations and policy structures are critical to successfully execute projects under PPP arrangement. Presently, Ghana has an existing policy on PPPs, launched in October 2011 as part of the Ghana PPP programme.
The policy defines a PPP as a contractual arrangement between a private sector party and public entity, which provides public infrastructure and services that are traditionally provided by the public sector. The Public Private Partnership Bill 2016 was laid before Ghana’s parliament in 2016 and had reached the consideration stage when the elections were held, but will now have to pass through the legislative process again.
Hence, Ghana currently has only a national policy guide; however, the guide does not give many details of the implementation process. The current government and Legislator musts step up its determinations concerning PPP by passing a PPP law in Ghana.
The law will provide more guidelines in the successful execution of PPP projects in the country (see figure 3). Ghana has existing legislation dealing with public procurement in the Public Procurement Act, 2003, which was amended by the Public Procurement (Amendment) Act 2016. As PPPs are a form of procurement, it is necessary to establish what crossover exists between the Public Procurement Act and the PPP Bill to avoid conflict between different regimes and ensure the correct framework is applied.
Figure 3: Legal framework of the PPP system
Capacity building of local PPP practitioners
Augmenting the competencies and capabilities of both government actors and private PPP practitioners is critical towards service delivery and infrastructural development in Ghana. Numerous native PPP experts predominantly government officials have very slight appreciation and understanding on the successful implementation of projects arranged under a PPP arrangement. More prominently, taking part in economical PPP project negotiation is sometimes a headache to numerous government officials.
In this respect, we strongly advocate for the government to build the capacity of the public servants through sponsoring them to either attend a local or international PPP conferences and workshops to build their competencies and knowledge on the successful execution of PPP projects. Again, the National accreditation board should ensure that various universities in Ghana start adding PPP modules to the curriculum so that future PPP practitioners would gain the necessary knowledge in the private and public institutions.
All-inclusive stakeholder engagement
PPP projects create a web of stakeholders with varying interests in Ghana. These various stakeholders, internal to the project such as public and private project officials, and those external to the project such as local communities and end-users play important roles in the delivery of PPP projects.
To this end, studies have been conducted and strategies and processes developed to aid in managing stakeholders. proposed frameworks for managing stakeholders within the PPP context. These include practical steps for engaging with stakeholders at different phases of PPP projects; some of which are similar to traditional public procurement stakeholder management.
However, some characteristics of PPP such the dual stakeholder perspectives in which the responsibilities of the public and private sector agencies in managing stakeholders in different phases of PPP projects are not considered in previous frameworks developed specifically for PPP, this article therefore recommend that stakeholder management should be approached from the dynamic dual stakeholder perspective where the partners partake in managing external stakeholders at the various phases of the project although they did not recommend processes for this. PPP project phases are critical and key actors in the partnership should deal with the multiplicity of interests from communities that might arise during community consultation processes.
Appropriate shared risk allocation
Public-private partnerships (PPPs) are an increasingly common model for delivering infrastructure projects globally. One of the key motivations for governments to procure and deliver infrastructure projects via PPP models is the assumption that PPPs deliver greater value for money (VFM) than conventional delivery methods. Optimal risk allocation is one of the key VFM drivers in a PPP delivery model. In a conventional delivery model, most long-term risks are borne by the public agency.
A PPP model, on the other hand, allows the public agency to transfer risks to the private party, relieving it of bearing the cost of risks that it cannot manage—such as cost overrun during the execution phase, execution delays and long-term maintenance of the asset. For the public agency, efficient risk allocation is, therefore, key to creating a “good deal” for society.
For the private party, efficient risk allocation is key to ensuring that the project is financeable and has an attractive risk-return ratio. Allocating risks in PPPs, however, is inherently challenging. Risk transfer to the private sector comes at a price, and transferring risks that the public agency is better able to manage is likely to erode VFM.
Thus, for the successful implementation of PPP projects in Ghana, policy makers and relevant PPP practitioners needs to focus on the following discussed in the article: open transparency and competitive selection process, established legal framework, capacity building of local PPP practitioners, all-inclusive stakeholder engagement, and appropriate shared risk allocation.
>>>the writer is a Researcher and Public Policy Analyst with considerable knowledge and expertise in Public Private Partnership, Leadership inspiration and Public Policy formulation. He is currently a Senior Management Consultant, Gimpa Consultancy and Innovation Directorate (GCID), the Consulting Division of the Ghana Institute of Management and Public Administration (GIMPA. Contact the Author on 0205012686 / [email protected]