Mr. Abdelaziz TALBI, Director of DEPP (State-Owned Enterprises and Privatisation) department at the Ministry of Economy and Finance chaired on Monday, November 24th 2008, a meeting with Fidaroc Grant Thornton firm. During this meeting, Thornton firm gave a presentation on the financing of PPP projects in France.
Senior executives from the DEPP department and the Budget department attended the meeting and it was an opportunity for Grant Thornton firm to give an overview of its activities and experience in the field of PPP projects. In his presentation, Mr. Wilfred AOUSTIN gave some clarification about this form of contract.
After defining PPP, he explained that the proceeding of a partnership operation is carried out in many stages. It consists on establishing a preliminary appraisal of the project, which is submitted for approval by a support mission (MAPPP) in view of proceeding, in a top secret manner, to the examination of offers in a context of competitive dialogue dealing with the technical, financial and legal aspects. At the end of this dialogue, the contract project and its annexes are finalised. The carrying out of the project is concretised by the setting up of a project firm in charge of the management, maintenance and the renewal of the existing structures. Once the work is handed in, the public party is called upon to pay a rent, which is decomposed in depreciation of investment, financing remuneration and in maintenance service.
The PPP contract is directed to performances as it commits the private partner to carry out jobs that respond to defined specifications and performances, with steady prices and the jobs delivered at a fixed date. The contract equally enumerates performance Indicators and instrument measures and fixes a penalisation system. Finally, Mr. Wilfred AOUSTIN elaborated on the reasons and motives that justify recourse to PPP and the hindrances to its development. As a matter of fact, this mode of partnership allows an acceleration and sustainability of pubic investment, a transfer of risk management to the private partner and a sharing of productivity profits with the private sector. Nevertheless, PPP still faces many obstacles, mainly related to limitation of public debt, resistance to change and lack of a personnel qualified in project management.
The presentation of this firm`s experience was a good opportunity for the senior executives from DEPP department to ask questions related to the evolution of PPP contracts, competitive dialogue, economic basement, breach of contract half ?way through and the advantages that the private partner gets from a PPP contract.
?Fidaroc Grant Thornton is a consultant and audit firm ranked 5th worldwide. It is a competent firm and has a huge experience in the carrying out of PPP projects, mainly in the field of health, education, research, infrastructure, urban planning, transport and energy.