In order to consider the PPP procurement option, the Authority and its advisers need to answer a set of key questions:
• Is the project affordable? Will users or the Authority, or both, pay for the project? How will they pay (e.g. user charges, operating subsidies, public sector or EU grants)?
• What are the key sources of risk in the proposed project? What is the optimal risk allocation and risk management strategy?
• What are the financing sources for the proposed project? Will the project be "bankable" (i.e. capable of raising debt finance)? Will it attract investors? Will it comply with the requisites for EU or national public funding?
• Even if the project is affordable and bankable, does the project represent value for money?
• Has the issue of the "balance sheet treatment" of the project (i.e. the classification of the project as a public sector investment for the purposes of national debt and deficit under the "excessive deficit procedure" of the Maastricht Treaty) been considered?
This section of the Guide identifies a list of issues and considerations for the attention of the Authority and its advisers when examining whether the selected project should be pursued as a PPP. It does not however offer a comprehensive catalogue of recommendations, as the assessment of the PPP choice will be dependent on the specific situation of each country, notably in terms of the legal and institutional context.