Lessons learned about PPP-projects in the Netherlands and Flanders
In recent years, a debate has been stirred on the added value of procuring projects through the use of DBFM(O)-structures, Public Private Partnerships. In the Netherlands, since 1999, many very large, large and medium sized infrastructure and social projects have been tendered by making use of this contracting structure. There have been successes. However, some projects have resulted in almost catastrophically losses incurred by the private sector (in particular by some contractors). The question therefore has been asked to what extent such projects should or should not have been making use of the DBFM(O)route and whether it would have been wiser to look for less loss generating delivery methods than the routes taken.
This issue and the ensuing debate have received considerable attention from the academic community resulting in a number of research projects and PhD-studies.
In their 2019 contribution in the European Journal of Transport and Infrastructure Research (EJTIR) - a peer-reviewed scholarly journal, freely accessible through the internet - titled, "Public-private partnerships for infrastructure: Lessons learned from Dutch and Flemish PhD-theses", the authors, Marloes Hueskes (Rijkswaterstaat, the Netherlands and the University of Antwerp, Belgium), Joop Koppejan (Erasmus University Rotterdam, the Netherlands and Southern Cross University, Australia) and Stefan Verweij (University of Groningen, the Netherlands), present the following lessons learned: "Our analysis of the PhD-theses shows that there are no definite arguments for or against the use of PPPs. The performance of PPP-arrangements depends on agency: on the skills and commitment of parties involved and on the way in which the arrangements are applied. The dissertations show that policymakers have to find ways to balance the need to reduce transaction costs through contract standardization with the need for tailormade solutions in specific projects. Furthermore, the dissertations show that ‘soft’ contract management aspects, such as the quality of collaborative behavior and process management, are particularly important for the performance of PPPs. Finally, the theses bring to the fore the democratic issues involved in PPPs, showing their mixed results in terms of legitimacy and accountability."
One of the authors, Prof. Stefan Verweij, along with Ingmar van Meerkerk and Henk Klaassen of the Erasmus University, is responsible for two other studies carried out in this respect: "De performance van DBFM bij Rijkswaterstaat: Een kwantitatieve analyse van projectendata" ("the performance of DBFM at Rijkswaterstaat, a quantitative analysis of project data") and the main study "Leren van 15 jaar publiek-private samenwerking: Een evaluatie van de performance van DBFM-projecten bij Rijkswaterstaat" ("Learning from 15 years public private partnership, an evaluation of the performance of DBFM-projects at Rijkswaterstaat"). These studies were commissioned by Rijkswaterstaat and Bouwend Nederland (which is the construction industry branche organisation in the Netherlands).
I can imagine both the public and the private sector are eagerly awaiting the results of this latter report which will be made public in October 2020.
A question which personally interests me is: how important is a delivery method for achieving success in a project? Based on the findings of the authors of the EJTIR study, collaborated by my own experience when working on A Practical Guide to Successful Construction Projects (https://www.routledge.com/A-Practical-Guide-to-Successful-Construction-Projects/Wassenaer/p/book/9781138204140), my gut feeling is: not very much. Contracting still appears to be of secondary concern.
Soon to be continued!