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Advantages and Disadvantages of Public Private Partnerships

Advantages and Disadvantages of Public Private Partnerships

There are many advantages and disadvantages of public private partnerships that should be considered before entering such a co- venture. A public private partnership refers to a venture in which funding and operations are run by a government agency or authority and a private sector entity. Over the years, public private partnerships have become increasingly popular internationally.

Public private partnerships are common in different areas including, infrastructure, transportation and gas and oil exploration.

Today, governments at all levels are faced with budgetary constraints yet the public needs them to deliver certain services.  Simply put, partnerships between the public and private sectors are critical in ensuring that a country develops economically.

One of the major advantages of public partnership is efficient management. Efficiency is very important in the management of developmental projects. This is achieved when the public sector and private company work together on a project. Plans as well as strategies are formulated and implemented more efficiently.

Another advantage of public private partnership is the improvement of the quality of the end results of a project. Partnership between a public agency and a private company brings technological advancement. This provides the necessary solutions for the completion of a project. Many private companies have highly advanced technology. When the government partners with such companies technology that is needed to deliver quality results is achieved.

The speed with which projects are executed is also enhanced due to the combined efforts of the government agency and the private company. In addition, the cost of accomplishing developmental projects is reduced through public private partnership. Both the government and the private company provide the necessary capital for development projects.

Nevertheless, there are drawbacks or disadvantages of public private partnerships as well. The difference in the work culture is one of the disadvantages of this venture. Differences in the functioning of a government agency and the private sector company can cause problems in the execution of the project.

Changes in government policies, often caused by changes in the electoral make up,  can also affect the model of the public private partnership. Such changes can affect capital flow or direction to favor the government leading to losses for a private company. This is one of the reasons why some companies fear to get into public private partnerships.

Mismanagement of the project is another disadvantage of a public private partnership. Mismanagement of the involved project is always a threat to the programs that are undertaken by the private and public sector. This is caused by unanticipated or unplanned challenges that lead to loss of resources that can benefit the government.

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Published by

Martin Milita

Martin Milita is a Senior Director at Duane Morris Government Strategies, LLC. Duane Morris Government Strategies (DMGS) supports the growth of organizations, companies, communities and economies through a suite of government and business consulting services. The firm offers a range of government relations and public affairs services, including lobbying, grant writing; development finance consulting, media relations management, grassroots campaigning and community outreach. Milita works at the firm’s Trenton and Newark New Jersey offices. Visit his blog at: https://martinmilita1.wordpress.com Follow him on twitter: @MartinMilita1 https://www.facebook.com/martin.milita http://www.dmgs.com/ BLOGROLL Martin Milita – About.me Martin Milita :: Pinterest Martin Milita @ Twitter Martin Milita at Slideshare Martin Milita on Google+ Martin Milita Yola Site Martin Milita | Xing

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