A problem common to many countries is that almost any ministry with a government can initiate and award PPPs. This is inefficient and wasteful. Indeed, there are strong arguments in favor of centralizing PPP capacity in a single governmental agency.
On the one hand, the PPP contractual technology requires a high degree of expertise and sophistication on the side of the regulator. On the other hand, such technology, once mastered, can be applied to all sorts of PPP projects, from highways to hospitals, from airports to jails. Hence, a specialized, professional, and credible government agency that can deal with these contracts in a centralized manner is a superior alternative to dispersed PPP initiators with weak capacity. Since learning on the job is necessary, the agency would need to attract top talent and provide an interesting career path to high performers. In addition, having sufficient in-house expertise would enable the specialized PPP agency to leverage and adequately supervise external expertise, from local and international sources.
The PPP agency should advise on the type pf projects that are more suitable for PPPs. It should also be able to identify the sectors where PPPs provide the highest value for money compared to other options (i.e. privatizations or government procurement contracts). A high-quality PPP agency, furthermore, would significantly mitigate the asymmetry of information between concession companies and the government.