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Friday, June 15, 2007

p3? no thank you.

Apparently it's like buying schools at Costco...


Wild English Rose said...

This may be of interest (PFI & PPP are roughly speaking UK equivalents of P3),,1052085,00.html

I did a study of the Bradford Schools project when I was a student and interviewed some of the key parties - Headteachers, Architects, Contractors etc. The main problems stemmed from inadequate specification - meaning that the council/schools were expecting to receive facilities & build quality that they had not stated in the original tender documentation and that was not therefore included by the contractors in the price. The result is either a massive bill for additional items or a low grade product. Under traditional procurement methods the price would not be fixed until a later stage in the design process when the client has had the chance to receive expert advice from architects/engineers and the design is much further advanced.

PFI/PPP/P3 can work very well for projects that can be clearly and comprehensively specified - e.g. a 4 lane highway from A to B complying will all national standards, but it is a less effective procurement for non-expert clients such as school boards.

In any case it remains an expensive method of borrowing money for government bodies that are usually able to access borrowing at much cheaper rates that the contractors they employ, but the upside is greater cost certainty and a transfer of the commercial risk away from the public client.

Kuri said...

P3s are almost always more expensive. We saw this over and over in Ontario, though Conservative and Liberal governments there. Not looking forward to seeing it confirmed again here.

Niles said...

If Costco was actually overseeing such a thing, given their corporate profile and social attitude, it might actually work out. But I thought the idea of a provincial government being in charge of the fixed assets of education was because they /are/ a form of Costco. An accountable, economical bulk buy force big enough to influence prices and to ably punish substandard contractors slipping through the vetting process. A force not beholden to the profit line, but the non-profit line.

Silly me.