Public authorities


The construction of public facilities in towns, municipalities, counties and states, played an important role in the delivery of certain public services within the traditional model of delivery or through public-private partnerships.

To deliver cheaper and higher quality of services local public sector developed initiatives for private delivery for complex transactions (PPP or 3P). Another reason is the limited FINANCIAL resources of  public sector and the limited borrowing prescribed by law.

One of the key economic assistance or works on the model of the Contracting PPP is currently to unload the current government borrowing as investors of all public facilities. Public sector (government or governmental unit) will define the standards and quality of service delivered. Private delivery, through tender bidders, from the private sector to introduce competition and all the positive effects that having competition result in.

EU states and associate members continue to be the increasing involvement of the private sector in financing, design, construction and management of maintenance projects and use of buildings which traditionally belonged to the public sector.

In the EU, there is evidence that the mode of transfer and implementation of public buildings consequently reduce cost of use and the total cost in relation to the so-called traditional way of organizing the transfer of Public Works (Construction Industry Council, 2000).

In order to increase capital investment and improve public services by member governments and the governments of the new EU member states are opting for new features and models, each of which a public private partnership is the general name for a variety of possible linkages of all participants in the project and the different contractual forms (management contracts, joint ventures).

Today when we comment on the PPP financing model and target region of public buildings such as hospitals, schools, sports facilities, University buildings, facilities intended for the Government (judicial centers, defense facilities for the needs of the county, city, local government etc., it is mostly about the contractual PPP (PFI  model and concession model of PPP) as a form of association of public and private sector.

PPP model can be applied for water projects, civil engineering, local transportation, utilities and other needs such as waste disposal.

The key feature is that the government is the main purchaser of services through installment of payment mechanism from the moment when a partner property becomes available, regardless of whether the need arises from the government or third parties. Use of assets are specified in the Agreement.

As a result of the methodological approach, the assets related to the public private partnership can be considered non-governmental assets only if there is strong evidence that the private partner bears most of the risks associated with the partnership.

Therefore, in this context, a qualified and professional knowledge in the fields of contract management and allocation and risk analysis (construction risk, availability risk, demand risk) is needed.