- Although PPPs are intended and designed to transfer financial risk to the private partner, the moral hazard associated with operational failure remains with government. Taking prison services as an example, government is accountable for setting policy objectives and structures under ministerial direction for maintaining prison assets (although the private partner is obligated to deliver agreed services under the contract). If a prisoner escapes, government is still responsible for public safety and bears the reputational consequences of this.
- Confidence and trust between government, consumers and other stakeholders can be enhanced through better communication about PPPs. Not only should the quality of public sector engagement about the workings and benefits of PPP be improved, there should be a greater level of transparency regarding the actual achievement of VfM outcomes in terms of government policy objectives.