VFM and Risk Allocation Models in Construction PPP Projects
Bing Li1, Akintola Akintoye, Cliff Hardcastle School of Built and Natural Environment, Glasgow Caledonian University, Glasgow G4 0BA A conceptual process model of risk allocation in ‘Public Private Partnership’ (PPP) projects is presented, as part of an on-going PhD study. Through an extensive literature review, risk factors in PPP projects have been identified. Primary data have also been collected through a questionnaire survey, and the analysis is in progress. Two key findings that have emerged from the analysis are presented. Eighteen measures that can enhance the achievement of ‘Value for Money’ (VFM) in PPP projects were subjected to a factor analysis, which grouped them into four categories: “project efficiency”, “project sustainability”, “multi-benefit objective” and “public effective procurement”. The second analysis discussed in this paper, concerns qualitative risk allocation, and is summarised in a tabular form. This later analysis illustrates that a majority of risks in PPP projects are “allocated to the private sector”. However, there are a few risks, where their unitary allocation is not obvious.
Some preliminary results of an on-going PhD research are presented. The overall aim of the research is to develop a risk management model specifically for PPP construction projects. Several milestones have been achieved in the study, including the investigation of critical success factors of PPP construction projects, and assessment of approaches to risk management. Primary data have been collected through a detailed and structured questionnaire survey, and are currently being analysed. The paper thus reports on the two aspects of the analysis, which have been completed: measures that enhance the achievement of VFM in PPP projects, and risk allocation between the project parties. Public Private Partnership (PPP) in construction concerns “a long-term contractual arrangement between...