Turnkey is a traditional public sector procurement model for infrastructure facilities. Generally, a private contractor is selected through a bidding process. The private contractor designs and builds a facility for a fixed fee, rate or total cost, which is one of the key criteria in selecting the winning bid. The contractor assumes risks involved in the design and construction phases. The scale of investment by the private sector is generally low and for a short-term. Typically, in this type of arrangement there is no strong incentive for early completion of a project. This type of private sector participation is also known as Design-Build. Figure 5 shows the typical structure of a turnkey contract.

Basic features

Pros:

• Well understood traditional model

• Contract agreement is not complex

• Generally contract enforcement is not a major issue

Pros and cons of turnkey