Managing partnership relations and contractual performance in the operating phase of Public Private Partnership: Interview Findings

The public partner has a governance responsibility in the operational phase of Public Private Partnership projects. It must ensure that contracted services provided by private consortia are delivered and that specified delivery standards are met. The public partner thus has to manage the relationship with, and the performance of, its private partner. Literature review is used to identify operational issues relating to partnership and performance management. These are then explored through interviews with 34 senior public and private partner industry representatives from Australia and the United Kingdom. Partnership issues relate to: organisational culture; management commitment and support; employee capability and expertise; and conflict management. For performance management, the relevant issues are: key performance indicator modification; contract variation; and penalties and abatements. The interview findings show that effective management of these issues by the public partner will increase the likelihood that intended Value-for-Money outcomes are achieved in Public Private Partnership.