Challenges and constraints in successful implementation of PPP
initiatives in the health sector. Regional Workshop on PPP in the
health sector in Asia West Bengal 29 September, 2011 Dr Christopher
C. Potter
Slide 2
1. Ideological/ political barriers Earlier revolutions/
struggles were about protecting rights from church and monarchs
(and colonial powers!): free speech, assembly, private property.
Rule of law to cover all. LaSalle and Marx: you reduce the State to
a watchmen to protect the few. New growth of States and rights
means education, health care, equality, justice. Great hope and
expectations which havent always been realised. Residual tensions
about role and size of State: good guys or bad guys?
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Private sector - Only interested in a fast profit Exploit
environment, public and staff Not accountable Creative and
innovative Competitive so effective and efficient Consumer oriented
Offer choice Capacity: skills, access to finance, people Not bogged
down by rules and regulations
Slide 4
Public sector Accountable Value driven Sacrifice high salaries
to serve public. Concern for the poor and marginalised. Guardians
of environment. Based on past learning and protecting the future.
Traditionalist and slow. Self-serving. Contemptuous of non- public.
Bureaucratic.
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2.Lack of shared understanding about what we mean by PPP
Slide 6
Wide spectrum of models. Not privatisation. Not out-sourcing.
Not the State washing its hands of responsibility.
Slide 7
Need for clarity Models Expectations and objectives Not just
between partners but to different parts of government, public,
press, beneficiaries. Pilots? Advocacy?
Slide 8
3. Lack of experience and skills in partnership working. What
is a partnership? Think about marriages or commercial partnerships:
Formal, lasting. Shared risks, responsibilities, opportunities. We
are in this together Sink or swim
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Imbalanced partnerships
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Multiple partners with potentially different expectations,
values, rules Yesterday heard about variety of stakeholders being
involved: - Supra-national bodies: bilaterals, etc. National
governments (not monolithic/ homogenous) Regional/municipal
governments/ Panchayeti Raj (India) Social insurance funds IFRO/
Roshan mobile (Afghanistan)
Slide 11
Missing partners? Drug companies? Investment institutions?
Professional bodies? Patients???
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4. Lack of stable policy context. Elections, ministerial
changes, officials promoted or transfer. Failure of new people to
understand PPP. Corruption and interference. Lack of interest in
continuity of administration.
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5.Non-congenial legal and financial context. Do the existing
laws, procedures and regulations allow for effective private
activity? Will all government departments accept the proposed
changes?
Slide 14
Determinants of policy effectiveness Potter & Harries, WHO
Bulletin, November, 2007
Slide 15
6. Lack of capacity within public sector Poor design and
procurement skills for PPP (rather than contracting). Tender
criteria? Performance indicators? Dispute management?
Adaptability
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7. Failure to design in partnership Will private sector be
interested? One private partner or competition? Locations: remote,
war-torn if public servants wont go there, why should the private
sector? Performance indicators? What happens if company defaults
and the bank wants to sell off the infrastructure and govt cant
continue services? Dispute resolution mechanisms?
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If state doesnt consult No tenderers or only one. If PPP is not
awarded private sector has lost money and will be reluctant to
participate next time. Becomes out-sourcing not partnership. BUT
process can take too long, and may look like too close a
relationship with a few potential partners.
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8.Contractual arrangements not sufficiently adaptive. Tariff/
fees dont keep pace with costs (or reflect falling prices from
competitors). Contract proves too expensive (NB PFIs in UK).
Emergent issues: not defining beneficiaries well enough, unexpected
problems in logistics or security, want to extend scope of
services. Recession. Unwillingness by officials to share risks and
responsibilities.
Slide 19
9. Governance matters Lack of legal frameworks to underpin
PPPs. How can we cope with non performance/ non payment? Assuring
quality worries about the inspectorate raj. Professionals reluctant
to criticise each other Companies not signed up to international
standards (Ottawa Charter, paris and Dakkar Declarations, Joburg on
sustainability, etc). Officials on Boards are still officials whose
bosses sign their annual performance reports. Accreditation? (One
standard for public sector and another for private?)
Slide 20
10. Lack of motivation & incentives PPP must be big enough
market to interest the private sector Hard if public sector
competing alongside? Is population base big enough? Is there
demand? Must overcome existing status quo and vested interests:
high officials, labour organisations, existing private service
providers