Monitoring entails managing, reporting on, and budgeting for the fiscal commitments arising from PPP projects, at both the project and portfolio levels. Monitoring PPP fiscal commitments requires gathering information on project risks and project performance from the concessionaire-as well as other inputs that affect the cost of PPP fiscal commitments, such as updated projections of key economic variables-and ensuring that this information reaches the relevant gatekeeping entities.
Gathering information from the concessionaire is typically the responsibility of the contracting authority, which has the direct contractual relationship with the PPP company or concessionaire. Information requirements should be clearly specified in the PPP contract (including for instance, traffic information and key financial ratios for the PPP company) along with indicators needed to monitor service performance. To back up this requirement, PPP legislation could include a provision giving the contracting authority the right to periodically collect monitoring information from the PPP company; alternatively, monitoring can be covered in the PPP contracts.