RAJESH S

PGDeG 2015-16

IIITMK, TECHNOPARK

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The Department of Economic Affairs (DEA) defines PPP as:

“PPP means an arrangement between a government or statutory entity or government owned entity on one side and a private sector entity on the other, for the provision of public assets and/ or related services for public benefit, through investments being made by and/or management undertaken by the private sector entity for a specified time period, where there is a substantial risk sharing with the private sector and the private sector receives performance linked payments that conform (or are bench marked) to specified, pre- determined and measurable performance standards”.

Agreement between Government and the

Private Sector for the Provision of a Public

Good or Service by the latter.

It involves private financing, construction

and management of key infrastructure etc.

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Key bottleneck in e-Governance Successful implementation of

e-Governance requires an

abundance of technical and

financial resources.

Antidote:

PPP has emerged as a viable

solution, thereby enabling

adequate funds and skills of the

private sector to be utilized for

e-Government projects.

PPP in e-Governance

The private partner invests in the application

software design, development, implementation

and operations.

The government maintains the responsibility to

deliver services to the citizen.

Success Factors of PPP Models

Political Will

Project address a real need

Clear definition of the Scope, Roles, Risks &

obligations

Legal Framework

Consultation with stakeholders

Transparent Selection Procedures

Security and Privacy

Features of PPP

PPP are concerned with services, not assets.

The Government does not need to own infrastructure to deliver services.

Private partner investing public infrastructure and providing related services to the Government, Government retaining responsibility for the delivery of core processes/services.

The Government and private party working together for achieving certain standards.

BENEFITS OF PPP MODEL

Citizens Government Private Partner

1. Easy Access to

service

1. Minimizing financial

outgo

1. Reliable stream of

revenues

2. Single window/one-stop

shop

2. Better liquidity 2. Low risk

3. 24x7 convenience 3. Protection against

technology

obsolence

3. Creation of employment

4. Flexibility in access

methods

4. Speedier

implementaion

4. Capturing business from

related sectors

5. Saving of indirect cost

and hardship

5. Efficiency in

management

5. Invoking private sector

skills, experience,

access to technology,

and innovation

Key principles for PPP

Return on Investment (ROI).

Minimizing brain drain .

Create realistic business models for e-

Governance projects.

Fi d ea h part er’s stre gths.

Develop formal policies on outsourcing

Return on Investment (ROI)

Companies- primarily means revenues.

Government- Means efficient, reliable,

robust services and increased legitimacy and

trust from citizens.

Officials- Means receiving training, as well as

professional opportunities.

Mi i izi g rai drai .

• To minimize government staff turnover, it is

important to develop innovative

compensation packages and professional

perks as incentives.

• Government might also want to consider

including clauses in contracts with the private

sector that prevent contractors from hiring

project staff away from government.

Create realistic business models for e-Governance

projects.

• The partnership can be stronger if there are

people in government who understand how

companies work and people in the private

sector who understand the needs of

government. A solid, well-designed business

plan will help.

Fi d ea h part er’s stre gths.

• Both business and government need to

contribute actively to the partnership.

Companies can be a source of cost-sharing,

technology and project management

expertise. Government needs to promote the

use of e-Governance among the public and

officials, as well as create a legal framework.

Develop formal policies on outsourcing.

• Government must establish clear parameters

for working with the private sector. More

important, the bureaucracy needs to be

trained on how to negotiate and draft such

contracts.

Role of Government in PPP

Set policy, identify opportunities, and define

objectives;

Ensure transparency and probity in the

procurement process;

Safeguard the interests of customers and the

general public.

Role of Private Partner Achieve defined levels of performance in

service delivery.

Provide expertise and innovation.

Provide access to private financing, as

appropriate.

Provide a sufficient return to investors and

other stakeholders.

e-Governance: widely used models

BOOT - (Build-Own-Operate-and-Transfer) Model

BOO- (BUILD-OWN-AND-OPERATE) MODEL

BOT (BUILD-OPERATE-AND-TRANSFER) MODEL

JOINT VENTURE MODEL

BOOT (Build-Own-Operate-and-Transfer)

Model

Here the private partner undertakes to build,

operate, maintain and then transfer the asset to

the government. The assets are transferred at

the end of the contract period. The private

partner does the designing, development and

implements the project.

BOO (BUILD-OWN-AND-OPERATE)

MODEL

In this model, the selected partner designs, develops

and implements the project, most often, entirely at

its cost and operates the system for a specified

period. Here transferring of ownership is not

included.

BOT (BUILD-OPERATE-AND-TRANSFER)

MODEL

In BOT model the private partner builds, operates

and delivers the service for a specified time

period under an agreement.

Sometimes the Private entity provide some or all

of the financing and recovers the entire cost along

with the interest from collection of user

utilization during the agreed period.

JOINT VENTURE MODEL

In this model, an SPV (Special Purpose Vehicle) is

formed to undertake the e-Governance project and

/or to provide e-Services. The joint venture can be

led by the government or by the private partner

depending upon the strategic nature and sensitivity

of the domain.

PPP CHALLENGES

It requires greater consideration and specification of

contingencies in advance.

PPP projects often cover a long-term period of

service provision. Any agreement covering such a

long period into the future is naturally subject to

uncertainty, more in case of Information Technology.

During the Operational and maintenance phase of

the projects the nodal agency have to monitor the

performance of the system against the standards.

• SOME e-GOVERNANCE PROJECT UNDER PPP

MODEL

BANGALORE ONE (B1) – KARNATAKA

B1 is a PPP between the State of Karnataka

and private consortium of CMS Computers

Ltd. and Ram Informatics. B1 project aims to

provide the citizens of Karnataka, all G2C and

G2B One-Stop services

BUSINESS MODEL

• B1 is the model is similar to BOOT.

AP ONLINE AP online is one of the pioneer e-governance

projects in Andhra Pradesh developed by

GoAP in Partnership with Tata Consultancy

Services.

BUSINESS MODEL

Joint Venture Model between Andhra Pradesh

Technology Services and Tata Consultancy

Services.

PASSPORT SEVA PROJECT

Passport Seva Project (PSP), implemented in

BOOT model. Tata Consultancy Services, (TCS),

a leading IT services, business solutions and

outsourcing firm, has a signed the deal with

the Ministry of External Affairs (MEA),

Government of India after the bidding

process.

SARITA - Stamps & Registration Information

Technology based Administration

SARITA is a G2C project with an aim to design,

develop, and implement a computerized

application for Registration of documents in

Maharashtra

Business Model

BOT

Conclusion PPP has emerged as a viable model for e-

Government implementation

PPP is especially recommended for developing countries

Every PPP needs to be customized to the particular requirements in each country

The adoption of PPP in e-Government will only increase with time.

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