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

Development of Policy, Legal, & Institutional Framework for the PPP Program in Malawi
Final Report
We have provided an illustrative PPP capacity building program in this report. As part of the
training, and capacity building as both part of training and as working with PPP Unit personnel
we again stress the need to institutionalize the knowledge base that will be build in the training
and capacity building program by developing PPP Nodes in these government bodies.
VI.M. When Deal Pipeline is Sufficient Establish Phase III Unit
There are two things that might never happen in the Malawi PPP program. One is the PPP Act
might never be passed because Government finds that the PPP program runs fine without it.
Care must be taken that a sense of complacency does not set in regarding the PPP Act. If there
is a need for it, because of the factors we have explained elsewhere in this report, then it has to
be passed, even if things seem to be going well with just the PPP Regulations.
The other thing that might never happen is establishing of the Phase III (or mature) PPP Unit.
In a country of Malawi’s size, the deal flow might never reach a level sufficient to justify the cost
of such a Unit. In such an event, we would simply continue with the Phase II Unit.
The best way to view the PPP Unit, in all of its Phases, is not to envision a jump from Phase I,
then a jump to Phase II, and then a jump to Phase III. The Unit is designed to be flexible and
scalable, so size (and cost) is always a function of demand for its services. In matters of public
policy and administration, it is usually best to take a gradual transition approach rather than a
radical shift in direction approach. That is why the design presented in this report envisions a
gradual transition from privatization to PPP, rather than an abrupt cutting off of support for
Privatization to pursue a PPP program, and a relatively long interim role for the PC during the
transition process. The move from PC to MOF doesn’t have to be done in a hurry, nor does the
move from a Phase II Unit to a Phase III Unit. Let things evolve naturally, and take the time to
do things right, so that a firm foundation can be put in place for the future.
And remember that PPP is not the magic pill to cure all ills. It’s complicated, and it requires a
fundamental shift in the way government goes about delivering services to its constituents. It is
extremely important not to allow unrealistic expectations to develop regarding PPP. The road
to success in PPP is long, winding, and filled with unexpected challenges to overcome. But we
must travel the road, carefully, because if we are to come anywhere near to meeting the ever
rising demand for public services, especially infrastructure, there simply is no other option than
to engage the private sector, and then try our best to make that marriage work.
VI.N. Timeline for Implementation of the National PPP Program
The two charts provided in the following pages provide an estimated timeline for implementing
the National PPP Program. Because Phase III (mature PPP Unit) begins when Phase II ends, it is
only necessary to present timeline charts for Phase I and Phase II. The timeline allows 1 year to
mobilize the Phase II Unit. This is considered achievable but a little optimistic. We thought it
advisable to present a slightly optimistic timeframe, but it could “slip” by 6 to 12 months.
In implementing the Program, it is important to avoid “sequencing” as much as possible, i.e. to
avoid having to wait for one component to be in place before working on the other component.
THE INSTITUTE FOR PUBLIC-PRIVATE PARTNERSHIPS 81