PPPs - Public Private Partnerships
by ballotsmith 5:05pm, 10 December 2007
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A matter little-debated, but whose economic significance demands much more, is the validity of this PPP approach to public investment in the largest infrastructure needs of the country. Why do this when, such projects could be better carried out by government agency, with much cheaper public finance?
Is it because partisan government, with a penchant for quick political points,just takes the easy way out, avoiding the effort and responsibility of a more demanding public service?
Is public enterprise inherently inefficient and uneconomic? If so, why?
Surely the quality of our leading politicians could hardly be regarded as insufficient to handle such enlarged responsibilities, when we consider that on retirement they are soon snapped up at large salaries by private enterprise.
Perhaps the blame lies at the door (once more) of the dysfunctional (and unaccountable) basis of 'democratic' government.
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Relates to website: http://theage.com.au/opinion - Letters 10.12.07
Relates to
document:
Power to the People Report (UK) (1.7 MB)
fullobeans Comment 1
10:08pm, 11 December 2007
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The NSW treasury PPP guidelines list the benefits of PPPs and they cite efficiency, better management of risk, risk transfer etc. I guess you are right that this is a bit of an abdication on behalf of the public service and you are also right that government debt is cheaper than private debt. However, in defence of the public service, a company whose core business is building motorways will always be better at it than an organisation with many other roles such as a public sector agency. Also voters have clearly indicated that they disapprove of government debt. This is a pity but PPPs are effectively just deferred spending that is acceptable to the voters. Instead of issuing bonds Government signs contracts to provide long term payments. In reality this is just the way of things, I think the private sector does have a role to play but I agree it is a pity the public service is too inept to compete and that we just sit back and accept that.
ballotsmith Comment 1.1
5:08pm, 31 December 2007
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fullobeans, You argue well! I would hope someone else might join in the debate as well as it is a quite important matter.
If construction contracts are routinely handed to private operators it is obvious that government will never gain the expertise. Government could easily acquire any needed expertise. It's really a management issue surely.
As to the voters; we are a disorganised and demoralised bunch whose judgement is hardly to be accepted.
Government debt has suffered from the bad propoganda of con-masters like Kennett and Howard but the voters seem to have woken up to them now. But see-saw government cannot compete, I agree.
Perhaps there is a challenge here for government.
I think the argument still stands, but another view would be interesting.