“The Government is increasingly seeking to develop financing mechanisms, which bring together the public and private sectors, not only to control budgetary expenditure but also to pool these two sectors’ specific know-how. This form of cooperation is commonly referred to as Public Private Partnerships (PPPs), which may be formally defined as “institutional relationships between the state and the private for-profit and/or the private not for-profit sector, where the different public and private actors jointly participate in defining the objectives, the methods and the implementation of an agreement of cooperation”. Public procurement and full privatisation lie at the opposite ends of a continuum defined by the extent of service obligations imposed, and ultimate ownership of assets. Though closely related, there are differences between public procurement, PPPs and full privatisation. Often the criteria used to choose the private partner for PPPs are more complex than just who offers the best price and who conforms to the technical specifications. In our conclusions we state that the issues discussed in the report raise significant challenges to conduct of successful PPPs in Kenya. The complexity of such arrangements and the high costs involved is enough cause for the Government to take a careful approach to PPPs. It should also recognise that PPPs pose many of the same problems inherent in procurement or privatisation and are not a panacea for development.”
