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

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Development of Policy, Legal, & Institutional Framework for the PPP Program in Malawi Final Report will be a need for donor funding to provide international experts to work in the Unit until their skills can be transferred to local counterparts. In addition donor grant funding will be needed to provide the Project Development Facility (PDF) with funds to finance feasibility studies. In time there may be a case for recovery of cost from the proceeds of PPP transactions. However, we do not see this in the early years of operation. This source of funding is being tested in the UK at present, with a reluctance of line-ministries to pay for PPP Services other than fund part of initial feasibility studies under the PDF arrangements. Recruitment & Performance Contracts Recruitment procedures have been set out in this report. It is important, as this Consultancy team has emphasized all along, to secure the services of personnel already fulfilling similar roles within the various Government Departments and State Agencies. In particular, the team would like to see the utilization of the PC Transaction and Special Fund management personnel early in the recruitment process, including economic support from the MoEPD, investment from the MIPA, financial analysis from the PERMU and redundant staff from the MDC etc. If this can be achieved early in the establishment of the PPP Unit, then the recruitments can be accelerated. It is still necessary to advertise in a competitive manner the key posts identified. The PPP Unit is not an administrative or an oversight unit strictly; but a supporting organization to deliver outputs based on a project management methodology. This Consultancy team therefore expects to see all appointments on fixed term performance contracts, in the case for particular infrastructure project for the defined term of the project. It is recommended, that external project specific consultancy contracts be offered rather than the recruitment of staffs into the PPP Unit, in order to keep the PPP Unit small. Capacity Building Training Plan 2006- 2007 While the IP3 team has identified the core competencies required for promotion and introduced a PPP Unit within a project management system of working, there is a serious requirement for PPP capacity building. The earlier this is addressed the better it would be not only for the PPP Unit but also for line ministries. The competencies required to mount a successful PPP Unit have been identified. The line Ministries, in addition to the PPP Unit staff need to have an excellent understanding of the working of the PPP Unit. We have suggested for large-scale projects line ministries should appoint their own ‘PPP transaction’ counterparts to the PPP Unit for the line ministries PPP Nodes. Public Awareness One of the broader considerations in setting up the PPP Unit is the need to communicate known factors now. In South Africa, a major effort went into the communication of the work of the PPP Unit. The Consultancy team believes that there is need to be able to communicate known factors, so as to reassure stakeholders of the approach, role and time-tables or establishment of the PPP Unit. There are a number of line- ministries already active in formulating PPP Strategies e.g. Ministry of Health, the MoTPW implementation of a new rail concession without understanding the proposals for the PPP Unit. THE INSTITUTE FOR PUBLIC-PRIVATE PARTNERSHIPS 64
Development of Policy, Legal, & Institutional Framework for the PPP Program in Malawi Final Report A firm plan does not have to be presented now but rather the intent for the future vision, mission and objectives for the coming year. The question of which legal structure, possible PPP policies, structures and organizational options are therefore only the means to deliver and not the objective in themselves. For example, the key elements of what the PPP Unit will be expected to deliver is known with a high degree of certainty. The Consultancy team suggests that is must be freely communicated now to stockholder’s possible topics we set out below: 1. The Government and the public sector wish to exercise better management over the assets and operations now and into the foreseeable future 2. Building new PPP businesses with strong effective operations and management structures as well as autonomy, while being responsible to Government policy and asset ownership. 3. PPP working practices should be on par with the best local and international practices, which will be a ‘blue print’ for future employment models. 4. The proposed PPP organization will move away from the civil service/public service poor practice more in keeping with a high performance organization, with the independent power of managing its own human resource policies, including the power to recruit; promote; develop and terminate. All PPP policies will be based on open, transparent and fair practice, emphasizing performance 5. There will be regular PPP communication sessions to address concerns and set out the progress of PPP projects during the transition period in establishing a PPP Unit. 6. The activities of the PPP Unit including the Government’s policy responsibilities for supporting pro-poor initiatives; addressing areas of healthcare, water, energy and transport. 7. The Government, regulatory structures and operational and management structures within Government and State Owned Enterprises (SOEs) should be such as to have the capacity to attract Public Private Partnership (PPP) investment in the infrastructure needs. With these basic principles and communication blocks in place, work setting out the preparation of the groundwork for the transition to the establishment of PPP Unit can be better understood by all stakeholders including parliamentarians. This will support the smooth establishment of a PPP Unit confident in the future of the work program and their potential role. Terms of Employment and Pay Structures It is doubtful if current civil service salary will attract the right caliber of personnel to these key positions. Senior positions should be on contract, with substantially different terms from the civil service. If the PPP Unit is established as a parastatal outside the civil service then remuneration packages can be on par with the private sector. Private sector remuneration levels THE INSTITUTE FOR PUBLIC-PRIVATE PARTNERSHIPS 65
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