What is the difference between Traditional Public Procurement and PPPs?
In traditional public procurement the focus is on the delivery of an asset, however, PPPs focus on the delivery of service outputs which require the construction, operation and on-going maintenance of assets. This conceptual difference means that the roles and responsibilities carried out by the public and private sector in traditional procurement and PPPs differ depending upon the specific contractual model that is being applied to the PPP.
For example, in a BOT public sector retains responsibility for specifying the project scope, service requirements and standards. Public sector takes responsibility for providing land that is free from encumbrances and carrying out any linked projects (for e.g. relocation of utilities). Private sector takes responsibility for detailed design construction, financing, operation and maintenance of the asset. The revenue payment risk can be taken by the private sector, by the public sector or be shared between the parties. | Figure 4: Difference in roles between Public Procurement and PPP
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