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© Dr Alister W Coutts & Partners LLP [email protected] Dr Alister W Coutts DQS, BA(Hons), MBA(Dist), MSc, PhD, FRICS, FCIOB, FCMI currently Lecturer in Project Finance & Appraisal Edinburgh Napier University Senior Partner Dr Alister W Coutts & Partners LLP Construction & Management Consultants
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Alister Coutts, Predavac, Edinburg Napier Univesity

Jun 24, 2015

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NALED Serbia

Treći godišnji samit „Razvoj javno-privatnog partnerstva u Srbiji po modelu Velike Britanije",organizovali su 8. novembra u hotelu Hajat NALED, USAID i Ambasada Velike Britanije uz podršku Hipo Alpe Adria banke. Britanija je jedna od prvih zemalja koja je počela da primenjuje JPP i jedna od najuspešnijih tako da su njihovi eksperti na konkretnim primerima prikazali mogućnosti, prednosti i mane tog modela ulaganja. Dr Alister Kauts
Predavač u oblasti finansiranja i evaluacije projekata, Univerzitet Edinburg Napier / bivši direktor za JPP projekte, Veće okruga Hajlend, Škotska

Telefon: +44 (0)1738 565749
E-mail: [email protected]
www.awcp.co.uk

Alister je postao ovlašćeni procenitelj 1976. godine i radio je u Aberdinu u Škotskoj, u kompanijama Armour & Partners i Anderson Morgan Associates. 1978. godine preselio se u Hong Kong i počeo da radi u Odeljenju za javne poslove Vlade Hong Konga, a nakon toga u hongkonškoj Mass Transit Railway korporaciji. Vratio se u Veliku Britaniju 1989. godine i počeo sa radom u kompaniji Developments, Commercial & Industrial (Holdings) Ltd. kao direktor za razvoj i upravljanje projektima. 1993. pridružio se Nacionalnoj zdravstvenoj službi kao operativni direktor, odgovoran za širok spektar aktivnosti, uključujući upravljanje objektima (ketering, čišćenje, telekomunikacije, upravljanje i održavanje nekretnina), upravljanje kapitalnim projektima, transport i nabavku zaliha i usluga. 1998. godine počeo je da radi u Veću okruga Hajlend, kao direktor imovinskih i arhitektonskih usluga. Takođe je bio angažovan kao direktor za JPP projekte, gde je bio odgovoran za niz opštinskih projekata kao što je izgradnja škola, domova, vatrogasnih stanica, kancelarijskog prostora i inicijativa za upravljanje otpadom. Alister je bio partner i direktor Odeljenja za usluge u javnom sektoru, u kompaniji Robinson Low Francis LLP, od 2007. do odlaska u penziju 2011. godine. Trenutno predaje Finansiranje i evaluaciju projekata i Upravljanje rizikom u projektima na postdiplomskim studijama na Fakultetu za inžinjerske nauke Univerziteta Edinburg Napier. Ima doktorsku diplomu filozofije sa Univerziteta Heriot Vat.
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Page 1: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Dr Alister W CouttsDQS, BA(Hons), MBA(Dist), MSc, PhD, FRICS, FCIOB, FCMI

currently

Lecturer in Project Finance & AppraisalEdinburgh Napier University

Senior PartnerDr Alister W Coutts & Partners LLP

Construction & Management Consultants

Page 2: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Public Private Partnerships

provide

Access to Private Sector Finance

A Mechanism for Project Control

A Chance to major on Life Cycle rather than Capital Costs

The Conceptual Framework (1)

Page 3: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Public Private Partnerships

Are about the delivery of Services to the public,

by a private sector organisation

with severe penalties for performance failure!

The Conceptual Framework (2)

Page 4: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

A View from Inside the Public Sector

Public Private Partnerships in Action

Page 5: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Where? - The Highlands of Scotland (1)

Page 6: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Where? - The Highlands of Scotland (2)

Page 7: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

The Highland Council – Key Facts

United Kingdom Land Area - 245,000 sq. km.

Scotland’s Land Area - 80,000 sq. km.

Highland Council Land Area - 26,500 sq. km.

United Kingdom Population - 60,000,000

Scotland’s Population - 5,200,000

Population of the Highlands - 210,000

Page 8: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Why Use PPPs? – The Reasons:

Acknowledged need to modernise their facilities;

Insufficient Central Government Finance available;

It left capital available for other infrastructure projects;

Financial support available from Central Government;

Allowed investment in major infrastructure developments;

Council had Project Management expertise ‘in-house’;

Council wished to promote Sustainability and to emphasise the importance of the Life Cycle approach.

Page 9: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

PPP - A Tried and Tested Approach

Regarded as Bad Regarded as Good

Page 10: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

PPP Projects in the Highlands of Scotland

Description Capital Value

Scottish Office - Skye Bridge 41 million

Scottish Office - Inverness Airport Terminal 16 million

Scottish Office - Highland Water & Sewage 80 million

NHS Highland - Easter Ross Primary Care Centre 16 million

NHS Highland - Craig Phadrig Psychiatric Unit 27 million

Highland Council - IT 22 million

Highland Council – PPP 1 Schools 28 million

Highland Council – PPP 2 Schools 150 million

Page 11: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Public Private Partnerships

Use of Private Sector Finance for Small Rural Projects

Page 12: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Criteria for Project Success (1)

Secure the Commitment of Sponsors / Users;

Establish the Affordability Criteria;

Establish the Value for Money Criteria;

Continually Check that Scheme is Bankability;

Check Acceptability of Key Terms / Conditions;

Check the Realism of the Risk Allocation.

Page 13: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Criteria for Project Success (2)

Prepare a Realistic ‘non-political’ Programme;

Appoint & Develop the Internal Project Team;

Appoint Compatible External Advisors;

Manage Stakeholder Expectations;

Manage Political comment & Press coverage;

Continually Market the Project.

Page 14: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

The Show Stoppers

Lack of Open Political Leadership & Commitment;

Absence of Appropriate Legal Framework;

Non-dependable Project Revenue Stream;

Lack of Openness, Transparency & Integrity;

Unrealistic Budgets, Expectations & Programme;

A Lack of Interest (Consortia / Contractors / Funders);

An Inability to Secure Domestic or International Funds;

Political, Public & Press Hostility to the concept.

Page 15: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Establish Political Oversight

The Political Process

Education PPP Sub-C om mittee[8 m em bers ]

Education C om m ittee[40 m em bers ]

The H ighland C ouncil[80 m em bers ]

Page 16: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Establish Managerial Control

The M anagem ent D ecision M aking Process

Turner & Townsend Project Managem entDeloitte & Touche

Shepherd & W edderburn W S

Education PPP Project TeamDirector of P roperty & Architectural Services

Head of Support Services ; PPP Project O fficerHead of Contracts ; P rincipal Solicitor ; P rincipal Capital Accountant

PPP Project B oardChief Executive

D irector of Finance ; D irector of Corporate ServicesD irector of Education, Culture & Sport ; D irector of P roperty & Architectural Services

Page 17: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

The Council’s PPP Strategy was:

Start small – minimise the risk to the Council;

Aim big – devise a ‘long term’ PPP programme;

Identify suitable potential PPP projects;

Identify lead politicians – with courage & convictions;

Identify, appoint and train PPP Project Team;

Appoint appropriate external advisers;

Allocate sufficient funds to undertake the initiative!

Page 18: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

We tried to ensure success by (1):

Only selecting ‘appropriate’ Projects;

Getting Political support for Process & Projects;

Appointing only ‘Experienced’ Advisers;

Use of Effective Project Management arrangements;

Use of Realistic Procurement Programmes;

Use of ‘High Quality’ Procurement Documentation;

Targeting ‘known’ Consortia to pre-qualify;

Stressing the need to Consult with Communities.

Page 19: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

We tried to ensure success by (2):

Ensuring the Outline Business Case (OBC) was realistic;

Placing the OJEU notice to suit market conditions;

Carefully selecting ‘appropriate’ Bidders;

Preparing a detailed Invitation to Tender (ITN) package;

Relating the Bids received to both the ITN and the OBC;

Avoiding the need for Best & Final Offers (BaFO);

Negotiating the key Project Agreement clauses with Bidders and Funders at an early stage in the programme;

Updating the Business Case on a regular basis.

Page 20: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Contractors / Consortia wished to know:

The Strategic Vision - the view of the Politicians!!

The Operational Context - is it important to the Council?

The Council – do they have PPP experience?

The Contractual Position – what is the period on offer?

The Design Concept – what quality / flexibility is required?

The Advisers – which firms have been appointed?

The Negotiating Team – have they experience & authority?

The Affordability Position – can the Council afford it?

The Procurement Programme – is it Practical or Political?

Page 21: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Council wished to ensure Economic Sustainability

Highland Council Objectives:

– Maintain fragile local economies;

– Ensure ‘local’ firms can participate in PPP initiatives;

– Avoid any internal redundancies / loss of capacity;

– Provide Training & Development opportunities.

A PPP initiative can deliver these Objectives if:

– Funders are prepared to work with local consortia;

– The project size allows local contractors be participate;

– Economic sustainability is fully recognised.

Page 22: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Public Private Partnerships

Sample Highland Council Projects

Page 23: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

8 year IT Contract with Fujitsu (ICL);

€ 81 million for a Managed Service;

Provision & Maintenance of 3,500 PCs;

3 year rolling refresh of all IT equipment;

Provision of all software & hardware;

Responsible for all Training & Development;

Transfer of 50 staff to Fujitsu;

First IT scheme using private finance.

Operational PPP Projects (1)

Page 24: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

25 year Contract with a Consortium consisting of the M J Gleeson Group plc & The Royal Bank of Scotland Group plc *

€ 128 million contract;

Project consists of 4 Schools in remote rural locations - details given later in the Presentation;

Model scheme completed in record time!

Schools now owned by Investment Fund *

Operational PPP Projects (2)

Page 25: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Operational PPP Projects (3)

30 year Contract for the funding, design, construction and operation of 11 Schools;

€ 225 million ‘Build Cost’;

€ 760 million contract value;

Single Bidder - but allowed to proceed by Treasury;

Financial Close achieved on 28 March 2006;

First school was handed over on 1 April 2007;

All schools are now fully Operational.

Page 26: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Outline Business Case completed for a 30 year contract for the funding, design, construction and operation of:

65 Fire Stations with a € 120 million ‘Build Cost’;

€ 270 million contract;

Project involves provision of facilities in four Municipal areas – Shetlands Isles, Orkney Isles, Western Isles and the Highlands!

Business Case was lodged with the Scottish Government for permission to proceed.

Pipeline PPP Projects (1)

Page 27: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Completed a Business Case for a 20 year contract for the Disposal of Household Waste;

€ 192 million contract;

Scheme was required to comply with legislation;

Proposed service will be very high cost due to the distances between communities;

The solution also has a high capital cost;

This is a politically sensitive project;

Do you wish an EfW Plant in your back yard?

Pipeline PPP Projects (2)

Page 28: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Pipeline PPP Projects (3)

Business Case accepted for a 15 year Contract for the funding, design, construction and operation of 5 Care Homes for the Elderly – € 51 million ‘Build Cost’;

Estimated € 145 million contract value;

6 Pre-qualified Bidders - with initiative being progressed under the Competitive Dialogue protocol;

Aim was to reach Financial Close in December 2008 with first Care Home to be available in August 2010;

Political decision taken to suspend the initiative!

Page 29: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Business Case completed for the funding, design, construction and operation of Office Accommodation with a € 12 million ‘Build Cost’;

Estimated € 39 million contract value;

4 Pre-qualified Bidders - with initiative being progressed under the Competitive Dialogue protocol;

Financial Close was programmed for May 2008;

Offices were to be available in August 2010;

Political decision to suspend the initiative!

Pipeline PPP Projects (4)

Page 30: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Education, Culture & SportPublic Private Partnership 1

Initiative

Page 31: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

The Council’s Principal Concern was:

Affordability

Not Value For Money

Page 32: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Affordability

2,500,000

3,000,000

3,500,000

4,000,000

4,500,0001 4 7 10 13 16 19 22

Years

Annu

al C

ost

The Council was ‘up-front’ on Affordability:

Page 33: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Everyone Worked Together To Achieve Success

Education Committee

(Members)

Project Board

(Officers)

Project Director

Community Groups &

School Representatives

Project Managers

External Advisers &

Internal Specialists

Page 34: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Project Details (1)

2 Secondary Schools

Drumnadrochit

250 pupils + 24 Nursery

(4,280 m2)

Strontian

250 Pupils + 24 Nursery

(4,680 m2)

2 Primary Schools

Spean Bridge

75 pupils + 24 Nursery

(940 m2)

Tomatin

70 pupils + 24 Nursery

(880 m2)

Page 35: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Project Details (2)

Annual Unitary Charge – € 4.5 million

Capital Value of Projects – € 25 million

Assets revert to Council ownership at contract end

No surplus land to consider

Page 36: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Education, Culture & Sport PPP 1

Glenurquhart High School, Drumnadrochit - 250 pupils

Page 37: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Education, Culture & Sport PPP 1

PPP1 Primary School Interiors

Page 38: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Education, Culture & SportPublic Private Partnership 2 Initiative

Page 39: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Project Details (1)

Dingwall Academy

1,100 pupils

Millburn Academy

1,100 pupils

Portree High School

700 pupils

Kinlochleven High

110 pupils

4 Secondary Schools

Page 40: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Project Details (2)

Cawdor

120 pupils

Culbokie

80 pupils

Resolis

100 pupils

Inshes

250 pupils

Gaelic

150 pupils

Kinlochleven

70 pupils

6 Primary Schools

Page 41: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Project Details (3)

Annual Unitary Charge - € 24 million

Capital Value of Projects - € 201 million

Assets revert to Council ownership at contract end

No surplus land to consider

Page 42: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Education, Culture & Sport PPP 2

Dingwall Academy - 1,100 pupils

Page 43: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Education, Culture & Sport PPP 2

PPP2 Primary School Interiors

Page 44: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Work with Communities – It is their Project !!

Stakeholder Management Award

Page 45: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Sample Pipeline Projects

Establish a Pipeline

Page 46: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Fire Services PPP Initiative

Page 47: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Fire Station Locations

Fire Service Sites

Page 48: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Highland & Islands Fire Service

The Problem - Obsolete Fire Stations

Page 49: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Highland & Islands Fire Service

The Solution - Single Bay - Achiltibue Fire Station

Page 50: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Waste Management PPP Initiative

Page 51: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Waste Facilities

Waste Management Sites

Page 52: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Waste Management Objectives

Prevent the generation of waste at source;

Use ‘local’ rather than ‘regional’ landfill sites;

Introduce Materials Recovery Facilities (MRF);

Provide an Energy from Waste (EfW) Plant.

Capital Investment is required

Page 53: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Public Private PartnershipsUse of Private Sector Finance for Large Urban

Projects

Page 54: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Hong Kong MTR Corporation 1990

Page 55: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Hong Kong MTR Corporation

Hong Kong MTR Hong Kong MTR Corporation is a public body;

Corporation operates on ‘prudent commercial principles’;

20 individual Development Sites above stations and depots;

Developments were phased over a 10 year period;

14 separate Development Agreements;

60% of railway funding came from PPP initiatives;

Hong Kong consortia & contractors with overseas funding.

Page 56: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Hong Kong MTR Corporation

High Land Values - All land owned by Central High Land Values - All land owned by Central GovernmentGovernment

Development Agreements with 8 Private Sector Development Agreements with 8 Private Sector ConsortiaConsortia

Short Duration Contracts - Only 3 to 5 year Short Duration Contracts - Only 3 to 5 year durationduration

Value of Contracts – Value of Contracts – approximately € 1,500 million€ 1,500 million

‘ ‘Upfront’ Funding of rail infrastructure by the Upfront’ Funding of rail infrastructure by the Consortia Consortia

Design, Construction & Marketing of buildings by Design, Construction & Marketing of buildings by ConsortiaConsortia

Ongoing management of building remained with Ongoing management of building remained with CorporationCorporation

Page 57: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Admiralty Development Agreement

Admiralty Centre – 2 x 28 storey towers - 95,606 m2

Page 58: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Hang Lung Development Agreement

Hongway Gardens - 35 storeys - 412 flats & 2,594 m2

Page 59: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Hang Lung Development Agreement

Vicwood Plaza - 33 storeys - 36,848 m2

Page 60: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Kornhill Development Agreement

Kornhill Gardens – 42 x 20 to 31 storeys – 1,060 flats

Page 61: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Traditional and Design & Build Projects

Page 62: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Operations Directorate Projects

Alterations to Cameron Hospital

Page 63: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Operations Directorate Projects

Sir George Sharpe Spinal Injuries Unit

Page 64: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Property & Architectural Services Projects

Golspie Secondary School : Technical Block

Page 65: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Property & Architectural Services Projects

Grantown Grammar School : Leisure Centre

Page 66: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Property & Architectural Services Projects

Ullapool Secondary School

Page 67: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Highland & Islands Fire Service

Kirkwall Fire Station

Page 68: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Housing Services Projects

Hayton Road Social Housing, Aberdeen

Page 69: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Housing Services Projects

Rorie Hall Social Housing, Aberdeen

Page 70: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Issues to Consider

Page 71: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Individual Project Programmes will be shorter;

Community benefits are much easier to realise;

Project Risks are easier to assess and manage;

Possible pool of local consortia and funders;

Opportunities for local consultants and contractors;

Facilitates local democratic control & management.

Advantages of Small Scale PPP Projects

Page 72: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Difficult to manage a national project pipeline;

Assumes that clients have PPP procurement skills;

Procurement costs may rise due to resource issues;

Danger of a ‘feeding frenzy’ once projects emerge;

Requires a change in procurement culture – can ‘Value for Money’ be the defining characteristic if there is no possibility of delivering an initiative other than by using a Public Private Partnership?

Disadvantages of Small Scale PPP Projects

Page 73: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Conclusions

Page 74: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Successful PPP initiatives need

Public commitment from Senior Politicians;

Support for PPP initiatives from Senior Officers;

The creation of the appropriate Political, Legal & Financial Structures;

The creation of a Production Line of Projects;

A Project Team consisting of your best people;

To be promoted to stimulate market interest!

Page 75: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

A Final Thought

If The Highland Council can use private sector finance to provide municipal facilities in a remote area on the edge of Europe then so can you!

You only need to try!

Page 76: Alister Coutts, Predavac, Edinburg Napier Univesity

© Dr Alister W Coutts & Partners LLP [email protected]

Dr Alister W Coutts & Partners LLPConstruction & Management Consultants

29 Lady Nairne DrivePERTH PH1 1RFScotland

Telephone: +44 (0)1738 565749 E-mail : [email protected]

www.awcp.co.uk

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