Institutional responsibilities for PPPs, that is, which entity will play what role at each step of the process will need to be defined in the framework.
Institutional arrangements differ widely from place to place. This depends on the particular needs of the PPP program and the pre-existing institutional roles and capacities.
General principles for effective design of institutional arrangement for PPPs
General principles to guide institutional arrangements for PPPs include the following:-
- Build on existing institutional responsibilities and processes;
- Design the institutional architecture appropriate to the likely scale of the task;
- Develop policies and architectures in parallel with the first projects;
- Assign responsibilities to agencies that have the incentives, information, and competence to discharge the responsibilities and clearly define any institutional relationships; and
- Avoid creating overlaps and additional coordination needs.
The point about building on existing responsibilities and processes is particularly important. There will already be sector agencies with responsibility for planning and developing projects. They these should generally continue in their existing role, while adding PPPs as a new delivery and financing option. Similarly, existing public sector procurement rules and public financial management rules will provide the background framework which will then needs to be tailored to allow and support the development of PPPs.