P. Consider the level of involvement required from other government agencies

Due to the nature of PPP transactions, they involve a variety of government agencies, other than the Procuring Authority who will also play a role. Some of those other stakeholders can include:

  • Finance ministries. Finance ministries will typically be required to provide approvals (with regard to additional funding, major scope changes, and contingent government liabilities) and may have reporting requirements.

  • Planning bodies. Planning permission is a major issue for many projects. Planning permission is also relevant in understanding what future development may occur in an area. For example, if there are residential or commercial developments planned, which may have an impact on the project.

  • Health and safety or environmental regulators. These bodies will often have the power to halt work on a project if they are not satisfied with the procedures being followed, and/or if there is an instance of non-compliance with the relevant regulation, and are therefore critical stakeholders.

  • PPP units. Central PPP units also play an important role in the overall success of the project. Resources and information provided by central PPP units can be invaluable for sharing lessons learned and improving project outcomes. This can be from a central PPP unit within the regional or national government, or a central body which has been set up to assist with projects in certain sectors. The role of PPP units with respect to contract management team training is detailed in Section 2.2 (Contract management team training).
  • Interfacing project operators. Stakeholder engagement is also required on projects which interface with other projects under the jurisdiction of a different Procuring Authority. Interfaces between different sectors or sub-sectors are very important. For example, a rail project may interface with power lines, other utilities, a highway or a bus rapid transit project.

  • Local or regional authorities affected by the project. 

A high-profile project will be of broader interest to the government, as it has the potential to affect the reputation of the administration in power at the time.

The Procuring Authority should carefully consider what information needs to be passed on to other government departments, such as a ministry of finance or other regulators. As a range of reports will be produced during both the construction and operations phases, there needs to be an assessment made of what exactly the Procuring Authority should report to the relevant government agency. Where there are significant changes made to a project (e.g. significant scope changes) approval is likely to be needed from a department such as the ministry of finance. This emphasises how important it is to consider what information needs to be shared with these departments. Scope changes are detailed in Section 3.5 (Claims).

It is also important for the Procuring Authority to assist these bodies by providing relevant project data to inform future infrastructure development. The combination of information from multiple sources is part of how these organisations, network groups and sector bodies are able to add value and improve the use of PPPs in that particular region. A Procuring Authority should maintain good relationships with these bodies to allow it to have continuing access to such resources. All markets, irrespective of whether they are mature or developing, have scope to improve significantly the strategy and the approach to understanding the value of data, including collecting and sharing it and making smart and effective use of it.

Example – Multiple government agencies

On the Port of Miami Tunnel project in the USA, funds were provided by federal, state, county and city sources, with the City of Miami also granting land access. The promise of ongoing funding to the Procuring Authority is particularly important given the decision not to impose tolls, as this increased the amount of money required from government. The Procuring Authority executed a funding agreement with the city and county, but these authorities had no direct oversight over the project. To assist in the management of the project, weekly meetings were held which included the Procuring Authority, the Project Company and the construction contractor, as well as representatives from city and county governments.

For more information, see the Port of Miami Tunnel Case Study.

Q. Set up effective governance structures to manage the relationships with other relevant government agencies

R. Collaborate with the Project Company to work with other government agencies, where appropriate

S. Plan early for managing other government or quasi-government agencies that the Procuring Authority does not have influence over