40. Governments, their agencies and departments sometimes opt for a PPP project in hopes of generating net revenue for the state. It is difficult to see how this could be the case under either an availability-based scenario or a user-payment concession scenario. It is obvious that an availability-based PPP will not generate net revenue for the state and will to the contrary entail a commitment of expenditure over a number of years. Under a concession user-pay PPP, any revenue that is collected by the concessionaire is revenue that could have been collected by the state if the project was conducted by public procurement minus the increased debt-service costs and return on equity associated with private-sector participation. Under this analysis, concession-based PPPs that are viewed as revenue positive by governments are actually revenue negative.
41. It should be no great surprise that PPPs are a cost to governments and should not be viewed as a revenue source. Building infrastructure or providing a service costs money and entails risk. To the extent that private sector actors incur these costs or take these risks, they will expect to be compensated. PPPs are more properly seen as only one of many options to provide national infrastructure or services. It is only logical that providing a service or facility that did not previously exist, or providing a service or facility superior to that which existed previously, will imply a cost for the state.