AS our governments strive to create the conditions for sustainable economic growth, identifying avenues for continued investment in public infrastructure is as crucial as it is challenging, given fiscal constraints across much of Europe and the Caribbean.

Partnerships between the public and the private sectors (PPPs) can be an important enabler of sustained investment. They promote the provision of efficient and cost-effective public services, with modern facilities, with reduced risk and reduced upfront costs to governments.

They bring the best of business to bear on public sector projects: innovation; risk management; discipline; and a culture of delivering on time, on budget, and to specification. In short, they can provide value for money. It is no wonder that they are increasingly on the agenda of governments across the Caribbean. Jamaica is making strides in its PPP policy development as part of its economic development strategy, building on its international airport experience.

The UK has pioneered the global development of PPP. Its principal model, Private Finance Initiative (PFI), recently reformed as PF2, typically sees a private sector partner design, build, finance, operate, and maintain an asset to provide a public service (eg, a school or clinic), while the government commits to pay an annual charge over the next 20-30 years.

To date, the UK has signed over 725 PFI contracts in sectors ranging from health, education, transport, waste, and justice, with a combined value of £54.2b. Over 85 per cent of the UK’s PFIs have delivered on time and on budget, compared with significantly lower figures for conventional procurement methods. Our leadership in PFI has turned our private sector into global providers of PPP — related services — financial, legal, technical, construction, facilities management, amongst others.

We didn’t get it right from the start, but the UK now has a formula for success backed by clear guidance and standard documentation. This makes the UK experience an attractive model to discuss in the Caribbean context.

On February 19-20, UK policymakers will be in Kingston to share their expertise and discuss how public private partnerships (PPPs) can benefit countries across the Caribbean. Led by Owain Ellis, project director at Infrastructure UK (IUK) — the multi-disciplinary team comprising of former private sector bankers, lawyers, construction managers as well as civil servants responsible for planning and delivering the UK’s infrastructure requirements — the conference will discuss how UK policy has developed, the components of good project design, and risk allocation. The meeting in Kingston will discuss the importance of extensive planning; inadequate project design can lead to unforeseen fiscal burdens well into the future. UK private sector representatives will set out the factors crucial to attracting private investment in public projects.

Public Private Finance is not a silver bullet. It will not solve all of our challenges in funding and providing services to the public, and each country’s approach will be different. PFI makes up only 11 per cent of total UK public infrastructure investment, but it is a vital part of the mix.

I am delighted that the UK and Jamaica are partnering in this important policy area.

Mark Simmonds is the United Kingdom’s Parliamentary Under-Secretary of State in the Foreign and Commonwealth Office and so has direct responsibility for British overseas territories.

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