Public Private Partnership + EU Funds in Poland general overview and the future outlook
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Public Private Partnership
+ EU Funds in Poland
general overview and the future
outlook
1. PPP as an instrument for implementation of regional policy
2. PPP Platform - national PPP taskforce3. Model of PPP - EU grant blending procedure4. Governmental experience with PPP5. Municipal experience with PPP 6. Hybrid projects in Poland7. PPP in the 2014-2020 financial perspective
PPP as an instrument for implementation of regional policy
• National Strategy for Regional Developmentsuggests public private partnerships as a desired instrument for investments at the regional and national level
• There is a need to maximise economic effectiveness of public infrastructure during the investment and maintenance phase – Value for Money
• PPP model requires better preparation of projects but provides a higher standard of public services
PPP as an instrument for implementation of regional policy
Financing of projects• Not all infrastructure investments are capable of being financed by
the private sector without public support – a need to implement availability payments and/or investment subventions.
• EU funds cannot be used for availability payments but they are a very effective source (component) of investment subventions
The legal framework is sufficient• Although there is a lack of verified solutions and standardized
procedures as well as answers to doubts and problems faced (e.g. step in rights; contracts)
Lack of experience• Both at the governmental and municipal level –
learning by doing is the suggested solution• Municipalities were self-learners without government support but this has changed recently
PPP Platform national taskforce
Establishment of the PPP Platform – an instrument for cooperation and knowledge exchange among public institutionsAgreement setting up the PPP Platform - 26 January 2011
Recipients of the support – open formula, accessible for all public institutions
Financing – Technical Assistance Operational Programme (EU funds)
Administration – Department for Preparation of Individual Projects at the
Ministry of Regional Development
How does the PPP Platform work?
PLATFORMA PPP
Administration:Department for
Individual Projects’ Preparation, MRD
External experts
Working Groups
Strategic decisions:Steering Committee
Meeting,
PPP Platform
Pu
blic secto
r (Municipalities)
ECEP
EC
JASPERS
PPP Platform activities
Review and analysis
Legal changes
Finacial issuses
PromotionTraining
Combining EU Funds with PPPs (Blended/Hybrid projects)
Working groups (supporting PPP
projects)
International co-operation
Model PPP - EU grant blending procedure
Procurement process
EU grant application process
Ex-ante analysis, Market testing
Grant application
Application evaluation on national level and JASPERS
Grant agreement
Transmission of the application to the EC
Evaluation of the application by the EC
EC decision
Tender publication
Negotiations
Appointment of theprivate partner
Financial closure
Application update
month 1
month 8
month 9
month 10
month 13 - 21
month 14 - 22
month 15 - 23
Schedule
10
How to combine UE application with selection of private partner process
and not to loose grant?
Unknown amount of
loan / financing costs
Unknown services prices(Gate fees)
Unknown revenues
Unknown amount of
private financing
Unknown financing gap
Unknown amount of subsidies
The greatest difficulty is the need to reconcile
the two parallel processes:
• applying for EU funds
• and selecting the private partner.
the vicious circle
Governmental experience with PPP (without EU grant)
Concession infrastructure projects:• A1 motorway (two stretches of the total length 152 km, concession dated
1997, stretch I operational since 2008, stretch II since November 2011)
• A2 motorway (two stretches of the total length 256 km, concession dated 1997, stretch I operational since 2004, stretch II since December 2011)
• A4 motorway (one stretch of 60 km, concession dated 1997, operational since 1996
• New A1 and A2 motorway stretches despite strategic location in central Poland proved unsuccessful – procurement finalised but the financial closure was not reached
Construction of The Court at Nowy Sącz City• under preparation
Municipal experience with PPP
Polish PPP market during the years 2009 - 2011(125 public procurement notices in total)
103
23
40projects completed (PPP agreement)
projects in preparation currently
under procurement
Source: MRD
Hybrid projects in Poland
• Waste Management System for the City of Poznań MRD employees participate in the competitive dialogue procedure as members of the support team for the City. The preparation of this investment has shown how complex is the path of applying for an EU grant for a PPP project.
• Thermal Baths in Gostynin– involvement of experts from Jaspers
• Thermal Baths in Solec Zdrój – financial closure reached
Thermal Baths in Solec – Zdrój City
Hybrid (PPP + UE), project is now under construction.
Financial closure reached. Both co-financing agreement (2011) and concession agreement (2010) were signed.
Beneficiary of the project: Solec – Zdrój Municipality.Responsibilities of the private partner: design, build, finance, operate. Remuneration of the private partner - user payments.Agreement signed for 27 years.
Total eligible cost of € 4 million, including: EU funds € 1.7 million pub. national contribution € 0.30 million private contribution € 2 million ~1 EUR = 4 PLN
PPP in the 2014-2020 financial perspective
• October 6th 2011, the European Commission unveiled a legislative package for cohesion policy for 2014-2020.
• Then, on the basis of this material the Permanent Representation of the Republic of Poland to the EU in Brussels, developed proposals for the new regulations regarding PPP projects, including:
1. PPP should be clearly recognised as one of the potential delivery modes for the CSF Funds;
2. Creation of the separate definition of ‘beneficiary’ under PPP operation. The proposed definition prevents the private body under a PPP operation from being the beneficiary as under PPP operations the party initiating the operation is the public body while the party implementing it is the private body;
3. Creation of legal basis for the situation, when the beneficiary is a public body, but on the basis of PPP contract the expenditure is incurred and paid by a private sector body, which is responsible for construction works.
• www.ppp.gov.pl• www.eib.org/epec• www.jaspers-europa-info.org
Useful links
Department for Individual Projects’ PreparationMinistry of Regional Development in Poland
tel. +48 22 461 39 44fax +48 22 461 33 66
e-mail: marta.witkowska@mrr.gov.pl
Thank you for your attention!
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