Establishing a National PPP Centre

Establishing a National PPP Centre: Definition and Purpose

A Public–Private Partnership (PPP) Centre (also called a PPP unit or cell) is a dedicated government entity that coordinates and supports PPP programs. Its purpose is to centralize expertise and signal the government’s commitment to high-quality PPPs. By staffing a skilled “client team”, a PPP centre assures private investors that the government has the authority and expertise to negotiate and manage complex projects. In practice, PPP centres develop PPP policies, guidelines and contract standards; they also provide technical support on project structuring, and build capacity across government. Most countries (especially OECD members) have found it valuable to create such units as proof of “requisite skills to manage PPPs” and to promote investor confidence.

Institutional Location and Governance

PPP centres are typically located in central ministries or agencies, but the exact placement varies. The most common model is within the Ministry of Finance (or Treasury), sometimes as part of a department or directorate. In the UK and South Africa, for example, PPP teams reside in the finance ministry, giving them direct access to budget and approval processes. A second model is an independent PPP agency that reports to, or is overseen by, a secretariat in finance. For instance, Germany’s Partnerships Germany is an independent corporation closely linked to the Ministry of Finance. A third model is to place the PPP centre in a planning or infrastructure ministry (or even under the Prime Minister/President’s office) if that body has a broad development mandate or manages major projects. Malaysia’s PPP unit sits in the Prime Minister’s Office, while the Philippines’ PPP Centre is under the National Economic and Development Authority (planning commission). In federal systems, a national PPP unit may work alongside state/provincial PPP cells.

Governance often involves an inter‐agency board or committee. Many PPP centres report to a high-level steering committee of ministers or senior officials. For example, the Philippines’ PPP Centre is overseen by a PPP Governing Board comprising the heads of planning, finance, infrastructure and other agencies. Such a board ensures alignment with national priorities and gives the PPP unit legitimacy across government.

Key Roles and Functions

A national PPP centre usually serves as a one-stop-shop for PPPs, with a broad mandate spanning the project lifecycle. Typical core functions include:

• Policy and Regulation – Drafting and updating PPP laws, guidelines and standard contracts; recommending regulatory reforms. The PPP centre leads in formulating PPP policy and maintaining the institutional framework.

• Project Pipeline Development – Helping identify and screen government projects for suitability as PPPs. This can involve initial feasibility screening, value-for-money analysis, and prioritization across sectors.

• Transaction Advisory and Project Preparation – Providing or coordinating financial, legal and technical analysis for selected projects. The PPP centre often develops or reviews project business cases, financial models and tender documents to ensure bankability and compliance. For example, South Africa’s PPP unit assigns a “transaction advisor” (often an external consultant) to assist each project with legal, technical and financial structuring. In the Philippines, the PPP Centre participates in all stages of a project – from preparation and bidding to contract award – to ensure projects are “bankable, transparent and advancing public interest"

• Approval and Gatekeeping (if mandated) – In some countries, the PPP centre has formal powers to review or approve PPP proposals before they proceed. Where this exists, it helps enforce rigorous evaluation. In the UK, for instance, HM Treasury’s PPP team must review all PFI/PPP deals for value-for-money. Generally, however, most PPP units act more as advisors or “consultants” to line agencies, rather than as final decision-makers.

• Capacity Building and Training – Strengthening the skills of government officials across line ministries and agencies. The PPP centre organizes trainings, workshops and manuals on PPP processes and contract management. By pooling expertise, the centre helps civil servants gain experience in areas like financial modeling, procurement of complex contracts, and risk management.

• Knowledge Management and Outreach – Collecting and disseminating PPP best practices, case studies and lessons learned. A PPP centre often serves as a “knowledge hub” that publishes guidance, publishes project databases, and facilitates information-sharing. It also liaises with investors – for example, running market-sounding events and providing clear channels for private bidders to ask questions about PPP programs.

• Project Monitoring and Support – Assisting during implementation and early operation to ensure contracts are followed and goals met. Some centres track project performance and help manage changes. For instance, an OECD study notes that one PPP centre’s team “assists the procuring authority with contract management, ensuring critical information (on contingent liabilities, etc.) is communicated to oversight agencies”. In practice, this may involve overseeing public-sector comparators, monitoring outputs or advising on renegotiations.

In sum, a PPP centre typically offers technical support and policy guidance throughout the PPP cycle. By doing so, it helps line ministries design projects that are financially and legally sound, which in turn builds investor confidence. Box 2.4 in the OECD PPP study (below) illustrates how in South Africa a PPP unit advisor works with each project team on technical, financial and legal aspects while providing access to a development fund:

“The transaction advisor works on the legal, technical and financial aspects of the project agreement… The National Treasury (PPP Unit) project advisor supports the relevant department throughout the procurement cycle… helping to apply for Project Development Funds available through the National Treasury.” – OECD (2010)

Organizational Structure and Staffing

A PPP centre should be structured to match its functions. At the top is usually a senior manager or Executive Director (often a civil service leader or appointed expert), supported by deputies or division heads. For example, the Philippines PPP Centre has an Executive Director with two Deputy Directors, overseeing divisions such as Project Development, Project Financing, Capacity Building, Legal and Administration. A steering committee or governing board (e.g. comprising finance, planning and sector ministries) provides strategic oversight and stakeholder buy-in.

Below leadership, the PPP centre is typically organized into specialized teams, which may include:

• Policy & Planning Division: Develops PPP strategy, laws and guidelines.

• Project Development / Pipeline Division: Identifies projects and conducts early feasibility assessments.

• Financial Analysis / PPP Unit: Performs value-for-money tests and financial modeling; may manage a project development fund.

• Legal & Regulatory Team: Drafts model contracts, advises on concession agreements and regulatory issues.

• Engineering/Technical Advisors: Reviews technical designs, performance specifications and environmental compliance.

• Procurement / Transaction Advisors: Supports bidding processes, bid evaluation and negotiation.

• Capacity Building & Communications: Manages training programs and stakeholder outreach.

• Monitoring & Quality Assurance: Tracks ongoing PPPs and reports on deliverables.

• Administration & Finance: Handles HR, budgeting and office management.

(This structure is illustrative – actual department names and grouping will vary by country.) The Philippines PPP Centre, for instance, includes divisions for Capacity Building, Knowledge Management (CBKMS), Project Development Services (PDS), Project Development & Monitoring (PDMFS), Project Financing (PFEMS), Legal and Administration. This ensures dedicated expertise in every area of the PPP process.

Staffing profile: A successful PPP centre requires a multi-disciplinary team. Key skill sets include: legal experts (public-private contract law, concession law, contract drafting), financial/ economic analysts (project finance, modeling, fiscal risk), engineers or technical specialists (industry-specific infrastructure knowledge), procurement/PPP specialists, and policy analysts. For example, South Africa’s PPP Advisory Unit (GTAC) assigns team members as “project advisors” to departments, and each project advisor brings legal, technical and financial know-how. Similarly, the UK’s Treasury PPP team has economists, accountants and attorneys to review business cases.

While specific staffing ratios vary, the centre must balance policy/regulatory capacity (for frameworks) with project-level support (for transaction work). Many governments supplement their core staff with external consultants for project teams, but maintain an “in-house” nucleus of specialists. Some PPP centres manage a project development facility or fund, which co-finances feasibility studies – and dedicated staff may help allocate these resources. For example, the OECD notes that the South African Treasury PPP unit helps ministries obtain development funds and runs a “PPP Advisory Unit” that provides both technical support and funding oversight.

Centralized vs. Decentralized Models

Governments adopt different models for PPP functions beyond the central unit. In a centralized model, a single national PPP centre handles most PPP activities and approvals. In a decentralized model, central roles (policy and oversight) are split among multiple agencies or levels of government. For instance, some federal countries have both a national PPP authority and state‐level PPP offices. Australia is illustrative: the federal Infrastructure Australia sets overall PPP policy and infrastructure priorities, while individual states (e.g. Victoria, New South Wales) have their own PPP/treasury units for subnational projects. Coordination is achieved through formal forums or committees: in Australia a National PPP Forum and a sub-group with state representatives align policies.

Other examples: India has the national PPP Cell in the Finance Ministry’s Infrastructure Finance Secretariat (which issues guidelines and appraises projects) and many Indian states have their own “PPP cells” to develop local projects. South Africa’s model is centralized (GTAC covers national and provincial PPPs on behalf of Treasury), whereas countries like Colombia have a strong national centre but also empowered local authorities to undertake PPPs under national rules.

In practice, a PPP programme should clearly delineate which tasks are centralized. Commonly, policy-setting, approval frameworks and funding decisions remain at the center, while project implementation and procurement are carried out by the sponsoring ministry or local agency. Even in decentralized settings, a national PPP unit usually provides guidance, standard tools and capacity building to subordinate units. The key is to avoid conflicting authorities: for example, OECD guidance warns that if a PPP unit both advises and approves projects, internal firewalls or independent oversight may be needed to prevent conflicts of interest.

Budget and Funding Considerations

A PPP centre requires a secure budget to build and retain expertise. Government budget allocations are the most common funding source. The centre’s line ministry (e.g. Ministry of Finance) typically provides salary funds, office costs and basic operations. Some PPP units (especially in early stages) have received seed financing or technical assistance grants from multilateral and bilateral donors. For example, the Philippines PPP Centre was initially supported by the Asian Development Bank, World Bank and donor agencies (JICA, CDIA, AusAid/CIDA) to help set up its capacity. Such external support can help train staff and develop systems, but ideally should phase out as the unit matures.

Occasionally, PPP centres may recover costs by charging service fees or managing project preparation funds. The OECD notes that PPP units may be funded “through user charges or a combination” with budget support. For example, a PPP centre might levy a small fee on finalized concession agreements or manage a project development facility that is replenished partly by government contributions. However, charging high fees can create a disincentive for projects and raise conflict-of-interest concerns, so this is less common. Overall, policymakers should ensure the PPP centre is “well funded relative to its mandate” – typically a modest fraction of total project costs – and not left understaffed.

Budgeting tips: In addition to salaries, allow funds for staff training and international liaison, for developing tender documents and model contracts, and for occasional experts’ fees. Many PPP centres also manage an infrastructure project fund (e.g. viability gap funding or development fund) – these trust funds have separate budgets but are often administered by the PPP unit. Ensuring sustainable financing is crucial: an inadequately funded PPP centre can quickly become ineffective, while a well-resourced centre (even if small) can greatly improve PPP outcomes.

Case Studies of Leading PPP Centres

• United Kingdom (HM Treasury / Infrastructure and Projects Authority): The UK pioneered PPP units. HM Treasury’s “PPP Policy Team” (within the Corporate & Finance Unit) reviews all major PPP/PFI business cases and provides policy guidance. It approves PPP deals in central government and ensures value-for-money. Parallel bodies (formerly Partnerships UK, now Infrastructure UK/Infrastructure and Projects Authority) assist with project delivery and financing. This long-standing system has standardized PPP contracts and built deep expertise.

• Colombia (DNP and Ministry of Finance): Colombia’s PPP program evolved through multiple agencies. In 1996 the National Planning Department (DNP) created a PPP team to promote and technically support projects. In 2011–2012, the government further strengthened capacity by establishing a PPP Unit in the Ministry of Finance (General Directorate of Public Credit) under the new PPP Law. This unit focuses on the financial appraisal of PPPs and on approving contingent liabilities. Colombia also created a specialized infrastructure agency (ANI) for transport PPPs. Today Colombia has a robust PPP framework: the DNP/finance PPP units handle pipeline and fiscal analysis, ANI manages transport projects, and a cabinet-level council (CONPES) approves project concepts, ensuring high planning standards.

• South Africa (GTAC – National Treasury): South Africa reformed its PPP regime by establishing the Government Technical Advisory Centre (GTAC) as part of National Treasury. Within GTAC is a dedicated PPP Advisory Unit. This team advises and supports departments throughout the PPP cycle. Under new Treasury regulations, the PPP Unit’s duties include guiding agencies to register PPP projects, providing technical review during feasibility and procurement, and managing knowledge transfers. In practice, GTAC experts work alongside line ministries to prepare business cases and achieve Treasury approvals. The centre also runs PPP training programs and manages the national PPP forum.

• India (Ministry of Finance – PPP Cell/PIU): India’s central PPP secretariat began as the PPP Cell in the Department of Economic Affairs (Finance Ministry) in 2006, later renamed the Private Investment Unit within the Infrastructure Finance Secretariat.. The PIU handles PPP policy matters, model concession agreements and capacity building. It also serves as secretariat to the PPP Appraisal Committee (which formally approves projects) and manages programs like the Viability Gap Funding (VGF) scheme. In effect, the PPP Cell acts as a facilitator and advisor: it issues guidance, helps ministries obtain central approvals for PPP deals, and shares best practices. India’s PPP framework is supported by World Bank and Asian Development Bank programs that provided training and project development funding.

• Philippines (PPP Centre under NEDA): The Philippines established a PPP Centre (currently under the National Economic and Development Authority) to be the “central co-ordinating and monitoring agency for all PPP projects”.. The Centre assists agencies at every stage – from project preparation and bidding to implementation – ensuring that PPPs are well structured. It provides capacity-building, offers advisory services (legal, technical, financial), and even sits in on bids as a neutral observer. Its organization (see diagram below) includes divisions for project development, financial management, capacity-building, legal affairs, etc. The Centre also helped create a Project Development and Monitoring Facility (PDMF) to fund pre-feasibility studies, with initial funding from the government and multilateral donors. By 2020 the Philippine PPP Centre had become a one-stop-shop model, widely cited as a best practice in enabling local governments to tap private capital.

Each of these cases offers lessons: strong high-level support (e.g. interagency boards), multi-disciplinary staffing, and clear mandates. For new PPP centres, it is vital to define powers and processes up front, secure adequate funding, and ensure close linkage with approving authorities (finance ministry, cabinet). Embedding monitoring, training and knowledge-sharing into the centre’s role will help sustain a robust PPP pipeline and avoid project failures.

Sources

Authoritative guides and case studies from the OECD PPP Unit report, World Bank PPP Reference materials, and official PPP Centre documents (e.g. Philippines PPP Center) inform these best practices. These ensure that the PPP centre can efficiently create, manage and evaluate PPPs across government. Soures fro this article include: