Delivering sustainable public infrastructure in China through PPP/PFI: lessons from a £300 million UK social housing procurement project.
Dr Alex Hope, senior lecturer in business ethics, Newcastle Business School, UK.
As the world’s largest developing country, China is facing challenges in providing high quality, sustainable public infrastructure to its rapidly urbanising population. In March 2016 the 12th National People’s Congress approved a new Five-Year Plan defining China’s development as innovative, coordinated, green, open, and shared. In the coming years, China will seek to improve the quality, efficiency and sustainability of its development with the government indicating that it is looking to Public Private Partnerships (PPP)s to deliver new schools, hospitals and housing. As such there is increased interest in the role the market should play through Public Finance Initiative (PFI) projects. In the UK the use of PFI has proved controversial due to the long term cost of servicing contracts and there have been questions as to whether PPP/PFI is an appropriate model to deliver ‘sustainable’ public infrastructure. Despite this, evidence suggests that appropriately negotiated PFI contracts that contain clear, measurable and achievable specifications can indeed result in the realisation of environmental and social benefits.
This presentation discusses the lessons learnt during the procurement of a £300 million PFI social housing project delivering environmentally, socially and economically sustainable homes for older people. It introduces an innovative PPP assessment methodology, the ‘PFI Sustainability Evaluation Tool’, developed to provide a comprehensive and holistic assessment of sustainability within proposed developments. Use of the tool has enabled public procurement officers to enhance the sustainability aspects of private sector PFI bids whilst facilitating the management of information, reducing threat of legal challenge, ensuing legislative compliance and educating procurement teams in sustainability techniques and technologies.