Civil Engineering nOVEMBER 2021 | Vol 29 No 10

From the Pres ident ’ s desk A ccording to the World Bank, public-private partnerships (PPPs) can be a useful tool to get more quality infra- structure services to more people. When designed well and implemented in a balanced regulatory environment, PPPs can bring greater efficiency and sustainability to the provision of public services such as energy, transport, telecommunications, water, healthcare, and education. PPPs can also allow for better allocation of risk between public and private entities and can help governments provide infrastructure and much-needed jobs for communities, while at the same time ensuring that budgets remain under control. PPPs UNPACKED From the draft National Infrastructure Plan 2050 (NIP 2050), published for comment by the Department of Public Works and Infrastructure in August 2021, there appears to be a new way of thinking from government, where private sector investment will be much more significant in infrastructure development going forward. NIP 2050 also identifies the need for cutting through the bureaucracy as well as looking at regulatory amendments in order to streamline PPPs in the implementation of infrastruc- ture projects. These projects have already been identified by Infrastructure South Africa and have been approved through the Sustainable Infrastructure Delivery System (SIDS) methodology for project packaging and financing. Private enterprises who are willing to invest in developments as well as infrastructure are finding it much easier to work with government, as government is steadily focusing on structural changes in order to make it easier for investors to finance and fast track projects that would have taken years to implement in the traditional way. Within a PPP the private sector’s role goes further than the regular facets such as the design and construction of infrastructure and encompasses areas such as project financing, project staffing as well as the operation and maintenance of the infrastructure assets. To put it simply, a PPP is merely a procure- ment choice that will contribute to accomplishing an anticipated solution to a social infrastructure problem. What is important, is that with PPPs there must be good understanding of the public and private sectors’ priorities and needs. There may be a misconception that private investors’ access to capital influences government to turn over control of projects and assets to them and that government’s overall vision of economic recovery, job creation and the eradication of poverty is secondary. This is not the case, and this lack of understanding could lead to incomplete or cancelled projects, which in turn leads to communities that lack the basic services they need as well as a growing distrust between investors, gov- ernment and the public in general. Furthermore, public officials are not without fault as they are too often reluctant to work cohesively with private partners or at times even hinder progress with long drawn-out approval pro- cesses and at times even cancel projects due to political influences or differences. There is now hope that we can create a more active dialogue about how public sector officials can use private capital for infrastructure development and lower the risk to the public coffers. With PPPs there is also transparency during the whole process from inception to implementation, and organisations that invest in infrastructure have a more structured approach to spending, with adequate checks and balances in place, as well as accountability. Most government departments are being inundated with the demands placed on them for infrastructure delivery, and there is just not enough money in the fiscus to fund the huge backlogs in infrastructure and maintenance. In a developing economy such as ours, where the population is growing rapidly and with severe service delivery backlogs, PPPs can have a net positive effect on the economy by reducing the unemployment rate in the medium to long term as well as addressing the demand for services and the development of social infrastructure. CONCLUSION As much as PPPs and blended finances models are good for en- suring that most of the projects identified under the SIDS meth- odology will come to fruition, it will take some time for these projects to be implemented as there is a lengthy approval process to ensure that they are bankable and not merely undertaken in a transactional manner. It is also vital that they address the direct needs of the public. Furthermore, a PPP is a long-term relationship between the public and private sectors to ensure that the deliverable outputs are reached. Overall, there must be adequate risk management in managing project threats by both parties as well as performance management by ensuring that projects are affordable, offer value for money, and that the agreed deliverables are imple- mented for the benefit of the citizens of our country. Vishal Krishandutt SAICE President 2021 president@saice.org.za Public-private partnerships in addressing infrastructure delivery needs Civil Engineering November 2021 1