Public-Private Partnership

Any collaboration between public bodies, such as local authorities or central government, and private companies tends to be referred to a Public-Private Partnership (PPP).

If privatization represents a take-over of a publicly-owned commodity, then PPP is more like a merger, with both sides sharing the risks and, hopefully, seeing the benefits. Many projects would not be built at all if it was not for private finance - the public money was simply not available.

 

Public-private partnerships:

  • can be used to finance, build and operate projects, such as public transportation networks, utilities, parks and convention centers. Financing a project through a public-private partnership can allow a project to be completed sooner or make it a possibility in the first place.
  • are at the heart of the government's attempts to revive Britain's public services. Local authorities are increasingly being steered towards PPP.
  • Private companies are often more efficient and better run than bureaucratic public bodies. In trying to bring the public and private sector together, the government hopes that the management skills and financial acumen of the business community will create better value for money for taxpayers.