Ghanaian Government must partner the Private Sector to deliver development- Event Report

Friday, October 08, 2010 

By Liana Bran, Intern, IMANI

Indeed, in order to attract the private investment necessary to the execution of PPPs, the policy framework should limit the role of politicians and ensure consistency across the mechanisms of the PPP process.

With the combined efforts of the World Bank and the National Development Planning Commission (NDPC), the Ministry of Finance and Economic Planning (MOFEP) hosted the Stakeholders Forum on Draft National Public-Private Partnership (PPP) Policy for Ghana on September 16, 2010.

While participants questioned the validity of the current attempt in light of the 2004 PPP policy guidelines which remain ineffective, the forum set forth a clear objective to develop a policy framework for National PPP which would facilitate implementation of Ghana’s PPP agenda.  The urgency for its production derives from the dearth of critical infrastructure and effective provision of public services which PPP projects propose to address.

Even as the chairman of the NDPC has yet been identified as Ghana’s PPP Champion, the demand for such a document grows; infrastructure drives productivity and economic growth but is also essential to the physical well-being and security of the population.  Beyond its more superficial, albeit undesirable, manifestation in one’s daily commute, lack of infrastructure has much more serious implications.  Chairman P.V. Obeng notably cited the loss of seventy lives in the Northern region due to inadequate flood-management capacity.  Still, as the chairman himself asserted, “The infrastructure [deficit is] such that the government cannot ‘do it’ alone,” and further explained that to do more would only incur more debt.  Fortunately, PPPs offer a potential solution as the public sector shares not only the benefits but the risks in partnership projects with its private counterpart.  Thus, if the government of Ghana is to take full advantage of the proposed scheme, the current policy framework should advance legal and regulatory guidelines that will promote an enabling environment for PPPs and transparent institutional arrangements to monitor them.

In order to comprehensively assess the various sections of the policy document, the forum was divided into syndicates to discuss PPP background and objectives; institutional roles and responsibilities; legal and regulatory environment; and the PPP process.  Upon reconvening, many of the groups made recommendations which merely reinforced pre-existing elements of the draft or further advocated increased clarity in those stipulations which will follow from the policy framework.  For example, emphasis was placed on coordination among Ministries, Departments, and Agencies (MDAs) as contracting authorities with shared interests.  Furthermore, it was suggested that the PPP might benefit from the establishment of a regulating body independent of these ministries.  The latter prescription recalls another point of contention regarding the potential for granting MOFEP too much power and the risk of creating a bureaucracy; it was agreed, however, that MOFEP should maintain its “gatekeeper” role, as one representative of the World Bank remarked that it can only be as strong as the other MDAs allow it to be.

While initially one member suggested that projects should be brought to the level of the presidency, such a proposal was deemed unfeasible; additionally, participants felt that as projects will inevitably extend across administrations, they should be insulated as much as possible from the political agenda of the presidency.

Indeed, in order to attract the private investment necessary to the execution of PPPs, the policy framework should limit the role of politicians and ensure consistency across the mechanisms of the PPP process.  It is important, then, that projects originate from the National Infrastructure Plan to identify infrastructure and public service priorities.  The forum determined that in the absence of this document, which is currently being developed, the NDPC should be given authority to identify projects that serve the larger strategic plan.  However, participants stressed that the approval process should be stringent, and there remains the need for specific policies to address unsolicited bids from the private sector, mechanisms for dealing with conflicts, and clear guidelines for project qualification based on viability and affordability.  On this last point, a consensus that feasibility and pre-feasibility studies should be funded by the government was reached, as those emanating from the private sector again involve vested interests.  Because PPP projects inherently have many possible implications for the future as well as the present, environmental and social impact assessments should also be made a priority at this stage.

Evidently, as the recommendations made by forum members suggest, the draft National PPP Policy for Ghana was a strong document to begin with, and only minor specifications regarding the roles of certain bodies and emphasis on the clarity of future PPP process guidelines were necessary.  Capacity building among MDAs and MMDAs (Metropolitan, Municipal, and District Assemblies) to navigate the PPP process is also essential, but the time to move past the failed implementation of the 2004 policy guidelines is now.  Given the deficit of infrastructure and its centrality to the development and well-being of Ghana’s constituents, the materialization of PPP policy and the complementary National Infrastructure Development Plan can no longer be delayed.

By Liana Bran is a student at University of Illinois at Chicago and currently interning with IMANI Center for Policy & Education.