The relevant issues of PPP performance management discussed in this section can be summarised as:
- KPI modification. KPIs should be relevant, reliable and accurate. The need for modification may arise due to a number of reasons: KPIs may not be 'fit for purpose'; there may be too many or too few KPIs that need to be evaluated as part of service delivery arrangements; changes to service delivery requirements; and a lack of KPI clarity.
- Availability of performance data. If KPIs are poorly designed, the data obtained from evaluating performance against these measures will be of limited or no value.
- Contract management. The best way for the public partner to hold its private partner accountable for their performance is through the continuous application of contract administration. Without a strong understanding of the PPP service delivery environment, public partner contract managers will find it difficult to accurately evaluate operational performance. Therefore contract managers should develop a hands-on role to ensure VfM propositions are maintained over time. Performance evaluation should be ongoing with the data collected potentially being used as a basis for developing control actions and managing emerging risks.
- Penalties and abatements. If KPIs indicate that agreed service delivery levels are not achieved, penalty points may be issued. The accumulation of penalty points will typically lead to an abatement being applied. However, abatement may be waived in favour of more strategic considerations.