UNECEs PPP Good Governance Guidelines currently being revised to address the SDGs
There are seven main arenas where good governance in PPPs must be observed:
Governmental level: executive stewardship of the system as a whole;
A coherent PPP policy
The PPP process requires coherent policies that lay down clear objectives and principles, identifies projects, sets realistic targets and the means of achieving them, with the overall aim of winning the support of the population for the PPP approach. Public administration: where policies are implemented;
Strong enabling institutions
Governments can build their capacities in a combined approach that includes building skills, establishing new institutions and training public officials and using external expertise.
Judiciary: where disputes are settled;
Legal framework "fewer, better, simpler"
Legal processes in many jurisdictions are either insufficient or too complex and therefore fail to provide sufficient security and incentives to investors in PPP arrangements. As a result, lawmakers should aim to create PPP rules that are ‘fewer, better, and simpler’.
Economic society: refers to state-market, public and private sectors;
Cooperative risk sharing and mutual support
PPPs allow risk to be transferred to the private sector, which are most able to manage them. However Governments also need to accept their share and help to mitigate those risks allocated to the private sector.
Political society: where societal interests are aggregated;
Transparency in partner section
The selection of the bidder should be undertaken following a transparent, neutral, and non-discriminatory selection process that promotes competition and strikes a balance between the need to reduce the length of time and cost of the bid process while selecting the best proposal. There should also be zero tolerance of corruption.
Civil society: where citizens become aware of and address political issues; and
Putting people first
The PPP process should put people first by increasing accountability and transparency in projects and improving the quality of life, especially of the socially and economically disadvantaged.
Sustainable development: where environmental concerns are included.
Achieving sustainable development
The PPP process should integrate the principles of sustainable development into PPP projects by reflecting environmental considerations in the objectives of the project, setting specifications and awarding projects to those bidders who fully match the green criteria