Application of public - private partnerships model and effect on public infrastructure construction projects in Sri Lanka

Abstract

Public Private Partnership is defined as a long-term contract between a private party and a government Agency, for providing public infrastructure and services, in this concept, there is an appropriate risk will be to the private party and where the private party bears investment and management responsibility on a long term basis .it reflects a continued collective effort between the public sector and the Private sector to achieve common objectives while both parties track their own individual goals. The government of Sri Lanka will require to think about substitute financing options to look over the monetary limitations and inadequate capital to develop infrastructure projects such as the Public Private Partnership financial model. However, the application of a centralized procurement model such as public-private partnership to develop infrastructure in Sri Lanka, trends to create financial implications attitudinal problems in government officers, control issues and difficulties in the management of contracts at the execution stage of the development project which needs to be completely understood by stakeholder institutes and strategy makers. Therefore, this study intended to identify the above consequences, barriers and the critical success factors that influence for application of the PPP model to develop infrastructure in Sri Lanka. The main objectives of this study were, Explore and study the critical factors identified in previous research for the successful delivery of PPP projects internationally. Identify current deficiencies and barriers in PPP practices and the critical factors that affect the Successful delivery of that model for infrastructure development projects in Sri Lanka and propose, areas to be addressed the identified issues for the successful implementation of the PPP model in Sri Lanka by consolidating the above objectives 1 & 2. Information and the data for the study were gathered by reviewing various types of literature, conducting questionnaire surveys among professionals and semi-structured interviews with the ten selected industrial experts for the PPP procurement method. Identification of critical success factors of the international concept was done considering the identified critical factors by the ten studies carried out in the different regions of the world related to the same topic of this study. Used frequency of occurrence method to identify the most critical factors under the above research studies and ten factors were selected as the most critical factors for successful application of the PPP model to the international concept. These factors were incorporated into the questionnaire survey to analyze the effect of those factors on the Sri Lankan concept Delphi method and the average ranking method were used to analyze the responses received through the questionnaire survey. Ten critical success factors were identified as the most critical success factors that affected the application of the PPP model to develop infrastructure in Sri Lanka and validation of these factors was carried out by conducting interviews with the selected ten experts in the industry. Ranking of the above critical factors was done using the average ranking method .accordingly Project technical feasibility, Good governance, availability of financial market/viability funding, Sound financial package, effective negotiation between parties, political Support, the well-prepared contract document, competitive/transparent procurement process, Sound economic condition/ economic Viability, Appropriate risk allocation risk sharing. Between public and private parties were identified as the most critical factors that affect the application of the PPP model for the successful delivery of the infrastructure project under the PPP procurement model in Sri Lanka.