4.1.21 Effective performance monitoring requires that the GPE monitors whether the service is being delivered, and to the contracted standards. The GPE should not engage in detailed management of the PPP provider. Rather, it should ensure that during the procurement phase, the selected PPP provider has acceptable performance monitoring, quality management and management information systems, and cash flows during the construction and operational phases. The GPE should audit these systems with planned and random spot checks to satisfy itself that performance is being measured and reported reliably, accurately and comprehensively.
4.1.22 The contract should provide for incentives and remedies to be in place to ensure that the PPP provider provides accurate and timely data to assure the GPE that the contracted service is provided to the required standards, and would continue to be so.
4.1.23 Any contract the GPE has with independent professional advisers must contain clear arrangements for reporting the results of performance monitoring to the GPE and the PPP provider. Both the GPE and the PPP provider's financiers have a common interest, vis-à-vis the PPP provider, in the quality of the asset or facility being built, and in the services being delivered to the required standards. There may be circumstances where it is more cost effective for the GPE and the PPP provider's financiers to jointly appoint an independent professional adviser. However, the GPE has to be careful that such a joint appointment would not introduce any conflict of interest.
4.1.24 The GPE should avoid action that could result in project risk being assumed or transferred back to the GPE or the government. For example, during the construction phase, the GPE should not approve any detailed drawings or designs. Instead, the GPE should in the first instance build into the contract which detailed designs and plans the PPP provider needs to submit to the GPE during the construction phase. This set should be a smaller subset than what the GPE would typically require in a conventional procurement phase, as under PPP the GPE is not making payments linked to milestones being met. Also, the contract should provide that as part of the certification of the completion of the building before service commencement, a specified set of designs and plans should be submitted to the GPE. It should only need to ensure by audit checks, that the PPP provider's quality assurance system for achieving the quality of design and service standards specified in the contract is working. The GPE should focus on enforcing the PPP provider's performance of its construction obligations under the contract. The GPE has to be constantly aware that it is procuring services, not equipment or facility.