Service performance should be monitored and measured in order to ensure that contractual compliance is achieved and demonstrated.
Management of service performance is fundamental to the PPP contract, as it is through this process that payments to the private party are calculated and any deductions made. It is therefore vital that there is a sound understanding of the relationship as it impacts the requirements in the output specification, the performance measurement system, and the method for making deductions for poor performance as set out in the payment mechanism. A detailed description of performance monitoring and management within the Construction Phase is provided below, and for the Operations Phase in chapter 8.
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