Prior to the enactment of the PPP Act most projects were undertaken under the prevailing public procurement laws. FILE PHOTO | NMG
What you need to know:
PPPs tend to shield the government from liability and interests that may accrue when state projects are funded by other lenders whose only goal is interest and helps boost economic growth in the private sector.
The government has in the past played an important role by being the primary provider of public infrastructure and services.
With the huge burden of developing infrastructure while providing crucial services, came the realisation that the government could not succeed alone, a situation that led it to gravitate towards new and innovative approaches to the provision and financing of public infrastructure and services.
We are increasingly seeing the need for private collaboration with the activities of the Government, which for too long had been separate and hence counterproductive in the long run.
This has led to several infrastructure projects being undertaken under a public private partnership model.
Currently in Kenya, a public private partnership (PPP) is defined under the Public Private Partnership Act 2013 (PPP Act) as an arrangement between a contracting authority and a private party under which the private party undertakes to perform a public function or provide a service on behalf of the contracting authority and is generally liable for risks arising from the performances of the function in accordance with the terms of the project.
This move towards more PPPs is a step in the right direction and as more countries are now formally adopting a framework for PPPs in their laws, Kenya has not been any different.
The World Bank Group’s recently-released report, Benchmarking PPP Procurement 2017, assessed the capacity of 82 countries, including Kenya, to prepare, procure and manage PPPs based on the prevailing policy, legal and regulatory framework and evaluates this data against generally accepted good practice.
PPPs tend to shield the government from liability and interests that may accrue when state projects are funded by other lenders whose only goal is interest and helps boost economic growth in the private sector.
Prior to the enactment of the PPP Act most projects were undertaken under the prevailing public procurement laws. The enactment of the PPP Act and subsequent regulations under it have sought to institutionalise the PPP process and establish organs such as the PPP Unit, the PPP Committee and the PPP Nodes.
Since the enactment of the PPP Act, the PPP laws have gone through a transformation over the years with the passing of regulations further providing clarity as to the PPP process in Kenya.
Through the current vibrant PPP laws, the government seeks to encourage and strengthen this form of engagement in hopes of realising Kenya’s Vision 2030 by encouraging and facilitating the involvement of the private sector.
The 2017 World Bank report noted that Kenya has a fairly robust PPP framework which largely supports many of the PPP projects currently in the pipeline, including the Lamu Port-South Sudan-Ethiopia transport corridor, Nairobi-Mombasa toll expressway O&M contract set to begin by end of this year, Kisumu Sea Port project and the Student Hostels PPP.
Juliet Mazera is Partner at MMC Africa Law and an expert in PPPs.
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