Concessionary nature of public-private partnerships in Russia and Kazakhstan: a critical review

This article provides a critical overview of Public-Private Partnerships (PPPs) in Russia and Kazakhstan and examines the rationale underpinning such partnerships. The analysis discusses the reasons why governments in Russia and Kazakhstan focus principally on concessions as a form of PPP and goes on to provide a critical assessment of the key approaches and situational factors relating to concessions in these two countries. The article finds that external globalization impulses pressed Russia and Kazakhstan to align their policies and institutions with western orthodoxy and perceived international best practice. An ever-increasing emphasis on use of PPPs has been a key feature of this alignment. However, the governments of Russia and Kazakhstan have increasingly resorted to concessions as progress with the development and implementation of Western style PPP models has stalled. This article concludes that the governments of Russia and Kazakhstan have demonstrated an overly optimistic approach to PPP and as a result may have substantially understated their overall concessional risks and costs. Features of Russian and Kazakhstani PPP arrangements such as ambiguity in output specification and extensive reliance on government subsidies, combined with lack of expertise of private partners, may significantly decrease concession benefits.

Impact of externalities on sustainable development: evidence from public-private partnerships in Kazakhstan and Russia

Purpose – This paper aims to investigate the influence of public-private partnerships (PPPs) on social and economic conditions in Kazakhstan and Russia from a public economics perspective, namely, through the lens of a market failure and PPPs’ negative externalities. Design/methodology/approach – Drawing on the concept of a market failure and using the externalities perspective, the paper investigates whether partnerships are instrumental in solving market problems, which is illustrated by the evidence from ongoing PPP projects in Kazakhstan and Russia. Findings – Results show that citizens face expansion of monopolistic trends in the service provision and decreased availability of public services. Additionally, the government support to partnerships recreates a negative externality in the form of a higher risk premium on loan interest rates that banks use to finance PPPs. The partnerships’ impact on sustainable development often appears detrimental, as they significantly intensify the struggle between sub-national governments for increased transfers from the national budget. Practical implications – The government agencies must incorporate the appraisal of the PPP externalities and their effects on the society in the decision-making regarding the PPP formation. Originality/value – The authors suggest that, although government is interested in PPPs’ positive externalities, in reality many negative externalities may offset the positive spillover effects. As a result, the partnerships’ contributions to economic and social sustainability remain controversial. Extending the value-for-money concept to incorporate the assessment of PPP externalities might significantly enhance the partnership conceptualisation by more comprehensive and accurate assessment of PPPs’ economic and social value.

Conceptualising public-private partnerships: a critical appraisal of approaches to meanings and forms

Purpose – The purpose of this article is to survey various meanings attached to a public-private partnership (PPP) and related aspects in Western literature, and identify commonalities and differences between them. Additionally, the article intends to critically assess conflicting and overlapping views on contractual and institutional PPPs, their forms and models, and draw insights for transitional economies. Design/methodology/approach – The article contrasts and compares views on PPP meanings, forms and models within Western PPP literature, and also draws comparisons with understanding of partnership aspects in the Russian language sources. The article examines theories underpinning PPPs, builds connections to PPP advantages and drawbacks, and provides critical assessment of net benefits that PPPs may bring along to the society. Findings – The article concludes that future PPP research in transitional countries such as Kazakhstan and Russia, particularly in the area of organisational and power arrangements in partnerships, may delineate new concepts such as government as a guarantor of a PPP project, social significance of a PPP project, and risk management in a country's contextual environment. Practical implications – In transitional countries, in which PPPs are in their infancy, clarification of theoretical positions, and identification of commonalities and differences between meanings attached to the PPP terminology may enable better decisions by researchers and practitioners in their selection and further development of partnerships and related concepts. Originality/value – Research in the field of PPPs in transitional countries such as Russia and Kazakhstan is in its infancy. The paper intends to contribute to the body of knowledge about PPPs by providing detailed account and categorisation of their principal meanings, forms, models, underpinning theories, and drawing insights for future research in transitional countries.

Legal and regulatory barriers to effective public-private partnership governance in Kazakhstan

Purpose – The purpose of this paper is to provide a critical assessment of legal and regulatory impediments to effective governance of public-private partnerships (PPPs) in Kazakhstan. Design/methodology/approach – The qualitative study develops propositions from the PPP literature and then tests them against findings from in-depth interviews. Interviewees have been selected by a purposeful sampling from PPP projects in Kazakhstan as well as from national and regional PPP centres. Findings – The identified barriers to effective PPP management include irregularities in the PPP legal framework, such as lack of legal definition of a PPP and controversy with the government guarantee’s legal status for its long-term payments to partnerships; bureaucratic tariff setting for partnership services; non-existent opportunity for private asset ownership; and excessive government regulation of PPP workers’ wage rates. Practical implications – The partners’ opposing perspectives on a number of PPP issues show that management needs to identify and carefully reconcile stakeholder values in a partnership in order to achieve more effective PPP governance. Practitioners, particularly those in the public agencies, have to be concerned with ways to reduce the government overregulation of the private operators, which is likely to result in greater PPP flexibility in management and, ultimately, higher efficiency in delivering the public services. Originality/value – By elucidating multiple examples of overregulation and PPPs’ inefficiency, the paper demonstrates that the government dominance in PPP management is conceptually inappropriate. Instead, the government should adopt the concept of co-production and manage its relations with the private sector partner in a collaborative fashion.

Partnership in the provision of recreational access: the reconstruction of the public interest in private land in England and Wales

This paper examines the evolution of public rights of access to private land in England and Wales. Since the Eighteenth Century the administration and protection of these rights has been though a form of public/private partnership in which the judiciary, while maintaining the dominance of private property, have safeguarded de facto public access by refusing consistently to punish simple trespass. While this situation has been modified, principally by post-World War II legislation, to allow for some formalisation of access arrangements and consequent compensation to landowners in areas of high recreational pressure and low legal accessibility, recent policy initiatives suggest that the balance of the partnership has now shifted in favour of landowners. In particular, the new access payment schemes, developed by the UK Government in response to the European Commission's Agri-Environment Regulations, identify the landowner as the beneficiary of the partnership, financed by tax revenue and justified on the spurious basis of improved 'access provision'. As such the State, as the former upholder of citizen rights, now assumes the duplicitous position of underwriting private property ownership through the commodification of access, while proclaiming a significant improvement in citizens' access rights.

Access to the countryside of England and Wales: public/private partnership or the privatisation of public rights?

This paper examines the evolution of public rights of access to private land in England and Wales. Since the Eighteenth Century the administration and protection of these rights has been though a form of public/private partnership in which the judiciary, while maintaining the dominance of private property, have safeguarded de facto public access by refusing consistently to punish simple trespass. While this situation has been modified, principally by post-World War II legislation, to allow for some formalisation of access arrangements and consequent compensation to landowners in areas of high recreational pressure and low legal accessibility, recent policy initiatives suggest that the balance of the partnership has now shifted in favour of landowners. In particular, the new access payment schemes, developed by the UK Government in response to the European Commission's Agri-Environment Regulations, locate the landowner as the beneficiary of the partnership, financed by tax revenue and justified on the spurious basis of improved 'access provision'. As such the state, as the former upholder of citizen rights, now assumes the duplicitous position of underwriting private property ownership through the commodification of access, while proclaiming a significant improvement in citizens' access rights.

Healthcare providers in the English National Health Service: public, private or hybrids?

In recent years it has been noted that boundaries between public and private providers of many types of welfare have become blurred. This paper uses three dimensions of publicness to analyse this blurring of boundaries in relation to providers of healthcare in England. The authors find that, although most care is still funded and provided by the state, there are significant additional factors in respect of ownership and social control which indicate that many English healthcare providers are better understood as hybrids. Furthermore, the authors raise concerns about the possible deleterious effects of diminishing aspects of publicness on English healthcare. The most important of these is a decrease in accountability

Recreational access to private land in England and Wales: public good; private interest

Since the Eighteenth Century the protection of public recreational access to private land has been maintained by the state through a mixture of legal rights of passage and the safeguarding of certain de facto access rights. While this situation has been modified in the last fifty years to facilitate some formalisation of access arrangements and landowner compensation in areas of high recreational pressure and low legal accessibility, recent policies indicate that a shift from public to private rights is underway. At the core of this paradigm shift are the new access payment schemes introduced as part of the restructuring of the European Common Agricultural Policy. Under these schemes landowners are now paid for 'supplying' recreational access, with the state, as the former upholder of citizen rights, now assuming the duplicitous position of further underwriting private property ownership through the effective commodification of access, while simultaneously proclaiming significant improvements in citizens' access rights.

Public-private partnership's procurement criteria: the case of managing stakeholders' value creation in Kazakhstan

The article presents the study of the criteria that Kazakhstan's government used for granting a public–private partnership (PPP) contract to a private investor for construction and operation of eleven kindergartens in the city of Karaganda during 14 years. From the perspective of value creation for critical stakeholders, there was often misalignment between bidders' views of these criteria and the perceived value for citizens and the government. The latter may significantly enhance the creation of shared values in a PPP by actively engaging stakeholders in the design of the bids' assessment criteria.

Public–private partnerships in Russia: dynamics contributing to an emerging policy paradigm

Public–private partnerships (PPPs) are new in Russia and represent project implementation in progress. The government is actively pursuing PPP deployment in sectors such as transportation and urban infrastructure, and at all levels including federal, regional and especially local. Despite the lack of pertinent laws and regulations, the PPP public policy quickly transforms into a policy paradigm that provides simplified concepts and solutions and intensifies partnership development. The article delineates an emerging model of Russia’s PPP policy paradigm, whose structure includes the shared understanding of the need for long-term collaboration between the public sector and business, a changing set of government responsibilities that imply an increasing private provision of public services, and new institutional capacities. This article critically appraises the principal dynamics that contribute to an emerging PPP policy paradigm, namely the broad government treatment of the meaning of a partnership and of a contractual PPP; a liberal PPP approval process that lacks clear guidelines and consistency across regions; excessive emphasis on positive PPP externalities and neglect of drawbacks; and unjustifiably extensive government financial support to PPPs. Whilst a paradigm appears to be useful specifically for the policy purpose of PPP expansion, it may also mask inefficiencies such as higher prices of public services and greater government risks.

Knowledge transfer processes in PFI/PPP: critical success factors

Successful knowledge transfer is an important process which requires continuous improvement in today’s knowledge-intensive economy. However, improving knowledge transfer processes represents a challenge for construction practitioners due to the complexity of knowledge acquisition, codification and sharing. Although knowledge transfer is context based, understanding the critical success factors can lead to improvements in the transfer process. This paper seeks to identify and evaluate the most significant critical factors for improving knowledge transfer processes in Public Private Partnerships/Private Finance Initiatives (PPP/PFI) projects. Drawing upon a questionnaire survey of 52 construction firms located in the UK, data is analysed using Severity Index (SI) and Coefficient of Variation (COV), to examine and identify these factors in PPP/PFI schemes. The findings suggest that a supportive leadership, participation/commitment from the relevant parties, and good communication between the relevant parties are crucial to improving knowledge transfer processes in PFI schemes. Practitioners, managers and researchers can use the findings to efficiently design performance measures for analysing and improving knowledge transfer processes.