Public Clients’ Best Value Perspectives of Public Private Partnerships in Infrastructure Development

Abstract

The multiple objectives of public clients in formulating partnerships with the private sector in infrastructure development and the radical realignment of risks, responsibilities, and awards among project participants in such partnerships necessitate a best value source selection (BVSS) methodology to choose the right private sector partner who assumes far more and much deeper risks than a mere contractor. One critical step in adopting the BVSS is to express the client’s objectives in terms of best value contributing factors (BVCFs), against which alternative proposals are evaluated and consequently a sound and defensible contract award decision made. A set of 21 BVCFs in public private partnerships (PPPs) has been identified through literature review of BVCFs in different types of contracts, case studies of worldwide PPP practices, and interviews or correspondence with international PPP experts and experienced practitioners. The relative significance of these BVCFs is statistically analyzed based on a questionnaire survey of worldwide expert opinions. Results show that there is no statistical difference in the rating of these BVCFs between responses from academia and those from industry. Except for four BVCFs that are at a significance level between “fairly significant” and “significant” according to overall, academic, or industrial responses, all other BVCFs are at a significance level greater than “significant.” These research outputs facilitate a BVSS process for PPPs in general.