The application of private public partnership in Hong Kong

Abstract

Public Private Partnership (PPP) is a kind of cooperative venture between the government (public sector) and business sector (private sector). Over the past decades, the Hong Kong Government intends to expand the use of PPP in delivery of development projects and public services, such as the Hong Kong Disneyland, the Cyberport, the construction of public infrastructures and management and operation of infrastructures. The shift in using PPP to deliver public services from traditional service delivery by government departments and non-government organizations imposes a significant implication to the governance in Hong Kong as well as in its financial and revenue aspect. The dissertation consists of four Sections. Section 1 is the introduction. In Section 2, I will conduct a literature review on the PPP in the aspects of its definition, concept, history and underlying theories. There are different forms of private sector involvement in public project, depending on the degree of private participation and involvement from the public sector. For example outsourcing in providing public services, build-operate-transfer (BOT) mode for providing infrastructure, service PPP. The various forms of PPP and the common usage of different forms on different aspects would be discussed. The considering factors, benefits and potential risks of adopting PPP will also be examined in this section. Though there exist various forms of PPP, there are common elements which must be included for a successful PPP, namely, common goal between the private and public, efficiency, transparency in selection of partner, risk sharing and accountability etc, which I will discussed in this section. In addition, the conditions for effective PPP and some recommended good practices of PPP will be detailed in this section. In Section 3, I will focus on 2 major forms of PPP adopted in Hong Kong and evaluate the performance of such applications through case study. The first PPP form is the BOT in which HK Government has adopted for providing numerous infrastructures like Cross Harbour Tunnel. The second one is the service PPP through which the Government contracts out the service provision to a contractor who works as a partner with Government. This form is widely used in the management and maintenance for road network and public lighting system. I will evaluate the above application of PPP (“Cross Harbour Tunnel” case and “Management and maintenance of road network and public lighting system” case) based on the principle and elements mentioned in Section 2. In the last part of the dissertation, recommendations are made for better development of PPP, in particular the ways for minimizing the ambiguity in accountability and responsibility between the public and private parties as well as increasing transparency to public. Finally, conclusion is drawn according to the whole study.