PUBLIC–PRIVATE PARTNERSHIP (PPP) FRAMEWORK AND GUIDELINES

Syed M. Ali Zaidi, P.Eng. PM(Stanford), Ph.D.

Director, Strategic PartnershipsAlberta Infrastructure. Government of Alberta

Canada

World Bank Group’s Public-Private Partnerships (PPP) CCSA Webinar – November 10, 2015

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OVERVIEW

The overall discussion will be in Canadian context but the focus will be on Alberta's PPP Framework and Guidelines.

PPP Framework Objectives

PPP Framework Components

Concluding Comments

COMPONENTS OF PPP

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Full / Partial Private Financing

Design Build Obligation

Maintenance / Operations Obligations

Assets Rehabilitation Obligations

Performance Based Payment Mechanism

PPP FRAMEWORK OBJECTIVES

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Is Intended to set the principles around which PPPs are conducted.

To ensure decisions on using PPPs are made based on VfM over the life cycle of the projects.

To use consistent procurement and documentation approach but also allows for variances for different types of infrastructure.

To ensure approval process is understood and followed for PPPs.

PPP FRAMEWORK COMPONENTS

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Capital Projects Planning

Public–Private Partnerships Principles

PPP Project Assessment Process

PPP Procurement Process

CAPITAL PROJECTS PLANNING & PPP FRAMEWORKS

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Infrastructure Management

Project Implementation

Project Planning Design & Tendering

Projects Identified as High Priorities

Identify Potential Projects

PPP Operations and Management

Project Implementation

PPP Procurement : RFQ, RFP Process

Business Case Approval for PPP

Project's Assessment as PPP

Capital Plan is the current approved capital expenditure plan that documents projects approved to commence in the five years.

CAPITAL PLANNING FRAMEWORK

PPP FRAMEWORK

Project Selection

Project Approval

Project Procuremen

t

Project Implementati

on

Project Operations

PPP PRINCIPLES

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• Reason for PPPs

• PPP Project Assessment

• PPP Review and Approval

• PPP Project Execution

• Determination of Value for Money• Accounting and Budgeting for PPP

Projects• Third Party Revenues

• Roles and Responsibilities

• Fairness

PPP PROJECT ASSESSMENT PROCESS

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INIT

IAL

AS

SE

SS

ME

NTWhether a PPP

would add value to the project:

Scope well defined.

Min. $100 million cost.

Greenfield project.

Potential of integrating design, construction & maintenance / operations.

Performance requirement can be defined.

No legal / legislative barriers.

OP

PO

RT

UN

ITY

PA

PE

RPreliminary analysis that provides evidence that PPP will provide VfM:

Project description.

Business and operational impacts.

Preliminary risk assessment.

Preliminary VfM Assessment.

Preliminary project schedule and team.

BU

SIN

ES

S C

AS

E It is an in-depth analysis:Project team and reporting structure.

Final business needs and project description.

Strategic alignment.

Business and operational impacts.

Project risk assessments.

Final VfM analysis.

Implementation strategy.

Review and approval of project procurement. Depending on factors such as results of the initial Assessment, project timing,

size, asset class, scope and the details of the proposed project, an Opportunity Paper may not be required and the Project may go directly to Business Case stage.

ROLES AND RESPONSIBILITIES

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CABINETAPPROVES

PROJECT

PROJECT REVIEW COMMITTEE

EXECUTIVE SUPPORT

PROJECT TEAM Project Director + Member from PM team, Legal, Finance & Client Departments + Advisors /

ConsultantsPLAN, DEVELOP, PROCUREMENT AND MANAGE PROJECT

TREASURY BOARD

PROCESS SUPPORT

OVERSIGHT COMMITTEE

OVERSEES THE PROJECT

* Typical Alberta PPP Project Organizational Structure

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PPP PROCUREMENT KEY CONSIDERATIONS

FairOpenTransparent

PPP PROCUREMENT PRINCIPLES

Process Integrity

Confidentiality

Schedule Certainty

PPP PROCUREMENT GUIDELINES

Consistent and Clear approach Policy and Legal Alignment Compliance with 'Trade Agreements' Evaluation Process and Guidelines Communication Protocols Conflict of Interests / Relationship

Review Disclosure Guidance Confidentiality Undertaking Managing FOIP Act Confidential Information in

Electronic Data Room Record Managements: Electronic

Mail, Personal Records, Documents

Identify Key Tasks and Milestones Align Processes and Approvals

accordingly

PPP PROCUREMENT PROCESS

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RFQ STAGE RFP STAGE CLOSING

12-16 Weeks 32-40 Weeks 2-8 Weeks

Announce Project. Issue RFP. Execute Project Agreement.

Hire Consultants / Advisors.

Open RFP Electronic Data Room.

Financial Close.

Hire Fairness Auditor. Provide Site Access.

Prepare Draft Agreement Documents / Schedules.

Receive and Evaluate Staged Technical Submissions.

Hold Information Meetings.

Arrange Technical Meetings with Proponents.

Open RFQ Electronic Data Room.

Receive Comments on Draft Agreement Documents.

Issue RFQ and Receive Submissions.

Issue Final Agreement version.

Evaluate Submissions.

Receive and Evaluate Financial Submission.

Shortlist 3 Proponents.

Select Preferred Proponent.

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THANK YOU

CONCLUDING COMMENT: Government must have robust PPP Framework and Guidelines to assist public sector with assessing potential PPP projects and delivering them in accordance with established practices and protocols.