Experts call for World Bank Group to end aggressive promotion of PPPs for public service provision. A new report exposing how public private partnerships across the globe have drained the public purse and failed to deliver in the public interest will be launched at the Annual Meetings of the World Bank in Bali next week.
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History RePPPeated: How public private partnerships are failing has been written by experts across four continents from many civil society organisations. They expose the negative impacts of PPPs that have often caused misery to local communities.
The report shows that multilateral development banks, such as the World Bank Group (WBG) have played a leading role in providing advice and finance for PPP projects in different sectors. This is despite the mounting evidence showing that PPPs are expensive, risky and opaque.
Rosa Pavanelli, Public Services International General Secretary, says:
PPPs divert funding from the public purse to private bank accounts. Instead of creating for-profit structures with tax payer’s money, we need investment in public goods such as health, education and water and sanitation.
PPPs do not deliver for communities and we call for a stop to these funding mechanisms by the International Financial Institutions before they increase inequalities even further.
Last year, EURODAD launched a campaign manifesto in which more than 150 civil society organisations from around the world, including PSI, called for an end to the aggressive promotion of PPPs. There is overwhelming evidence of the harm they cause.
The report covers 10 case studies from Colombia, France, India, Indonesia, Lesotho, Liberia, Peru, Spain and Sweden. The sectors investigated include education, health, water and sanitation, energy and infrastructure.
Some of the main findings are:
- All projects came with a high cost for the public purse, and an excessive level of risk for the public sector and, therefore, they resulted in a heavy burden for citizens.
- Nine out of 10 of the projects lacked transparency and/or failed to consult with affected communities, and undermined democratic accountability.
- Five of the 10 projects impacted negatively on the poor, and contributed to an increase in the divide between rich and poor.
- Three of the PPPs resulted in serious social and environmental impacts.
The case studies include the Queen Mamohato Hospital in Lesotho, which is bleeding government coffers largely through huge costs for the treatment of patients; and the case of Jakarta Water in Indonesia, where two PPP contracts resulted in huge losses for the public water utility, while residents often have to rely on groundwater from community wedge wells, or buy expensive water in jerry cans.
The report recommends that the WBG, the International Monetary Fund (IMF) and other public development banks, together with the governments of wealthy countries that play a leading role in these institutions:
- Halt the aggressive promotion and incentivising of PPPs for social and economic infrastructure financing,
- Support countries in finding the best financing method for public services in social and economic infrastructure.
- Ensure good and democratic governance is in place before pursuing large-scale infrastructure or service developments.
- Ensure that rigorous transparency standards are applied.
LAUNCH OF REPORT:
The report History RePPPeated: How Public Private Partnerships are failing will be launched at the World Bank/ IMF Annual Meetings 2018 in Bali Nusa Dua, Indonesia.
- Date: Wednesday October 10th from 13.30 to 15:00
- Where: Civil Society Policy Forum, Bandung Room.
- Event: Report exposes how PPPs across the world drain the public purse, and fail to deliver in the public interest
- Report: History RePPPeated - How public private partnerships are failing
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