Development of Policy, Legal, and Insitutional Framework for - ppiaf

Development of Policy, Legal, & Institutional Framework for the PPP Program in Malawi
Final Report
hold as a natural course of events. In Malawi, if the PPP program does not readily take hold,
we will need a PPP Act ready to pass to get everyone focused on the benefits of PPP and
Government’s commitment to support it.
In Category III, the highest-scoring option was the one below:
Option / Number Pros Cons International Models
Don’t enact PPP Act (4)
Operate a new PPP
program in MOF under
regulations to be issued
under PFMA. Selected
PC staff to MOF.
Creates a fresh new start
for PPP without baggage
of PC and divestment.
Principles of PPP
(affordability, risk
allocation, value for
money) are all principles
of public financial
management. PPP
program properly sits in
the ministry responsible
for and where decisions
are made regarding
public finance.
Despite the success of
this model in South
Africa, the PFMA in
Malawi might be less
appropriate for such an
approach. Local Gov’t
Act might add
complexity if it would
require duplicate set of
regulations, as was the
case in South Africa
thereby adding some
complexity.
South Africa, U.K.,
Ireland, Australia: PPP
Units in the Treasury
operating under
Treasury
PPP
Regulations.
The most attractive feature of this option is we already know that regulations could be issued
under the Public Finance Management Act, as described in our analysis of the preceding option
above, but in this option we drafting a PPP Act and then figuring out when (or if) it should be
passed. Although this option has enjoyed success in several countries, those countries have
market systems that are more easily adapted to having joint ventures between government and
private operators than the system in Malawi.
Because of the potential need for a national PPP Act in Malawi, to give a clear signal to
stakeholders that Government is serious about its commitment to PPP, we cannot advise
adopting this option because it does not allow for the possible need for such an Act to be passed
in the future, if the market response to PPP Regulations is less than hoped.
Description of Selected Option and Way Forward
Based on a comparative analysis of the three best-scoring options, presented above, we consider
Category II option 5 to be the best choice for Malawi’s PPP Legal Framework. To summarize
the essential components of the preferred option:
‣ Mobilize the national PPP program by issuing PPP Regulations under the Public
Financial Management Act and prepare a draft PPP Act for Government to pass at the
appropriate time, if and when such an Act is deemed necessary;
THE INSTITUTE FOR PUBLIC-PRIVATE PARTNERSHIPS 36