Download Public-private partnership and its role in efficiency increasing of

Public-Private Partnership and its role in the
increased efficiency of public governance system
I.V. Zapatrina,
Chairman of the Board of the Ukranian
Public-Private Partnership Development
Support Center,
Economics PhD
European principles of public law and
governance
 differentiation of regulatory and governing functions
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of the state;
creative competition;
harmony of rights and responsibilities;
social dialogue and partnership;
equal attraction of all interested subjects toward the
formation and implementation of personnel policy;
implementation of modern concepts and technologies
governing the development of human potential.
The goal of administrative reform
“step-by-step creation of such a public governance
system which guarantees the formation of Ukraine as a
highly developed, legislative, civilized European
government with a high standard of living, social stability,
culture, and democracy, will allow Ukraine to become an
influential factor in the world and Europe. Ukraine’s goal
is also the formation of a government system, which will
come closer to the needs and questions of the people, but
its highest priority will be the service to the people, and
national interests. This government system will be
controlled by the people, transparent, built upon scientific
principles.”
The Decree of the President of Ukraine dated 22.07.1998 No.810/98 in redaction dated
26.05.2006 «On measures related to introduction of the Concept of administrative reform in
Ukraine»
Principles of public management
system reform
The government purposefully minimizes its intervention in life
security for its citizens and takes on only those services, which at this point
in social development it has the capacity to guarantee and which cannot be
found in the service market. It constantly wants deregulation, to hand over
it’s functions to the self-regulated market and non-government
organizations on the principles of:
1. determining the list of services needed by the citizens, as well as the
criteria for evaluation of the efficiency of these services;
2. relations between consumers and suppliers of products and services are
regulated by the market, aside from those situations, when it cannot
adequately satisfy society’s needs;
3. management services have to be paid only when the citizen has a choice,
to use this service or not use it;
4. management services have to be offered at the lower levels of executive
power, which will ensure these services for the consumers.
The Decree of the President of Ukraine dated 22.07.1998 No.810/98 in redaction dated 26.05.2006 «On
measures related to introduction of the Concept of administrative reform in Ukraine»
Expenses of an expanded government
in Ukraine and countries of EU, %GDP
7
6
5
4
3
2
6,9
6,6
6,7
6,4
5,1
1
3,5
Ukraine
6,4
EU
4,5
0
State
Education
management
Health
protection
Economic
activity
Data from the Institute of economy and forecasting of NAS of Ukraine
Main Functions of Public Authority
 development of a strategic course concerning issues
of internal and external policy of the state/
territorial development
 development of drafts normative-legislative acts
 efficient management of public and city finance and
public/communal property as well as control of
their use.
 Provision of public services
Some characteristics of Ukraine’s
regulatory system
 simplicity of carrying a business – 142nd place
from 183 countries in the world
 efficiency of the tax system – 181st place from 183
countries in the world
 fiscal load on businesses – level of GDP
redistribution through the budget for 2009 – 42.4%
According to Program of economic reforms
Management of public/communal
property
1.State enterprises
- 500 out of 4000 of Ukraine’s enterprises, where 50% or
more belongs to the state, are currently in bankruptcy
status
2. Communal enterprises
- receivables in sector of housing and communal
services (heat supply, water supply, sanitation, city
electric transport) has reached 12 million UAH
- technical condition of the branch (part of the networks
of the water/heat supply system, and sanitation,
which are in distressing conditions, is more than 30%)
According to program of economic reforms
Public Services
Public Services – services offered by the state authority, local governments,
enterprises, institutions, organizations managed by them.
State services – services offered by the state authority (mainly the executive
branch) and by state enterprises, institutions, organizations, as well as, by local
authorities in accordance with the powers delegated by the state, at the
expense of the state budget.
Municipal services – services offered by local authorities, as well as members
of executive power and institutions, enterprises, and organizations, in
accordance with the powers delegated by the local government, at the expense
of the local budget.
Clarifications of the Ministry of Justice dated 18.12.2009 No.967-02-09-22
Services provided by the public sector, as well as the private
sector, with the public power responsible for it and at the
expense of the public funds.
Medical support for 100,000 people
900
800
700
600
500
400
300
200
100
0
Ukraine
868
EU
644
302
Number of beds
261
Number of doctors
According to the Program of economic reforms
Characteristics of the nation’s health
3
2,5
2
1,5
0,5
3
2,5
1
1
1,15
Ukraine
1
EU
1
0
Length of life
Infant mortality
Untimely death
According to the Program of economic reforms
Share of public sector in GDP (%)
40
35
30
25
20
15
10
5
0
Ukraine
Canada,
England,
Italy
USA
Poland
Info of the Institute of economy and forecasting of NAS of Ukraine
Development of Public-Private
Centers in the world
PPP-1997
PPP-2007
Info of the Polish PPP center
Public-Private Partnership in Europe
Country/Sector
Administrative Defense
services
Health
Prisons
Education
Sport
Austria
Belgium
Check Republic
Denmark
Estonia
France
Greece
Spain
Netherlands
Ireland
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North Ireland
Lithuania
Latvia
Germany
Poland
Portugal
Slovakia
Slovenia
Scotland
Switzerland
Hungary
Great Britain
Italy
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I.Herbst: speech on the III Astana’s Economic Forum, Kazakhstan, 1-2 July, 2010.
The differences between the public
and private sectors
Private Business
State/Local Government
The possibility of attracting highly-qualified specialists Noncompetitive salaries, and consequently, not a high
due to a flexible approach in determining salaries, enough level of qualification
bonus systems
The maintenance and development of personnel High dependency upon the political situation, as a
potential, fluctuation of workers, institutional memory result, the loss of institutional memory
Flexibility and efficiency in approving decisions
Excessive formalization and regulation, difficult and
large procedures on decision-making
Optimal procurement in price and quality
Corruption in carrying out procurement
Initiative, individual responsibility
Fear of taking on responsibility,
irresponsibility
Stimulating factors in achieving results (profit, Lack of stimulation in attaining results
capitalization – for owners, bonuses – for
management)
Interest in long-term results
Advantageously tactical and short-term tasks
competition
collective
The potential of public-private
partnership to provide public services
in Ukraine
• The state of public services provision in our country is
negatively perceived by the population and businesses and
requires improvement;
• The inclusion of the private sector in providing public services
will not require vital changes in legislative regulation of the
sphere of budget support and its increase.
• The transfer of a few public services to a private business will
give us the opportunity to lighten the load of state workers from
routine labor and will give them the chance to concentrate on
solving strategic questions of development, the improvement of
legislative regulation, and other similar tasks.
The Law of Ukraine “On state-private partnership” does not make
provision for PPP in the performance of public services
Forms of interaction between the public
and private sectors in the sphere of
public management
Value for Money:
- Decrease of services cost while conserving the services quality
- Increase of services quality on a fixed cost of the services
competition
 The transfer of functions
in provision of public
services to the private
sector.
 Joint implementation of
socially important
projects
Quality standards for services
Monitoring the service quality (from the public sphere and
civil society)
Elements of public-private partnership in
the sphere of public management in the
Program of economic reform
•Transfer to procurement of state services from state
health establishments on a contractual base;
•Development support for the private sector in medical
services, provision of access to state financing on a
competitive basis;
•Approval of the law on administrative services and
securing, in it, principles of delegation of authority;
Weak points in the development of PPP:
 The lack of partner relations on the axis: “government – local self-
government - private business”
 The population’s distrust of the ‘private partner’
 Weakly developed legislative regulation system in the PPP sphere, lack of
methodology and knowledge of preparation and realization of such
projects;
 Non-sufficient qualification and knowledge of public and business
representative in the PPP sphere;
 The lack of standards for service production and a developed system of
monitoring quality;
TASKS:
CREATION OF INSTITUTIONS – CENTERS OF COMPETITION IN PPP’S SPHERE
DEVELOPMENT OF SCIENTIFIC, INSTITUTIONAL, METHODOLOGICAL SUPPORT OF
PPP
IMPLEMENTATION OF PILOT PROJECTS
DEVELOPMENT OF INSTITUTIONAL CAPACITY OF THE PUBLIC AUTHORITY
Thank you for your
attention
www.ukrppp.com