A New Concept of the Public-Private Partnerships in the UK

DOI: 10.20542/0131-2227-2014-8-67-75

V. Varnavskii, Institute of World Economy and International Relations, Russian Academy of Sciences (IMEMO RAN), 23 Profsoyuznaya Str., Moscow, 117997, Russian Federation (varnavsky@imemo.ru).

Abstract. A new Public-Private Partnerships concept Private Finance 2 (PF2) adopted by UK government instead of the Private Finance Initiative (PFI) is analyzing. PF2 follows the Open Public Services Program according to recent changes in the economic policy. A description and evaluation of PFI concept are given. The reasons for termination of PFI are also revealed. Special attention is paid to the new problems of the Concept, as an access to lax credit, concerning the public sector as an equal co-investor, and risks reduction. The increased importance of institutional investors such as banks, funds, insurance companies, international export-import agencies is shown.The paper is partly devoted to the issues of PFI/PF2 administration in UK. The role of governing authorities in Public-Private Partnerships implementation and their standing in the government structure are disclosed and analyzed as well as their functions and outcomes of their activities. PF2 reaffirms UK government’s commitment to Public-Private Partnerships. It remains to be a predominant form of drawing private investments into infrastructure development. The British government hopes that PF2 will increase private sector interest to finance public investment projects such as schools, roads, hospitals, waste utilization and other large-scale infrastructure.

Keywords: Great Britain, government, infrastructure, investments, Public-Private Partnerships, Private Finance Initiative, budget, Public Administration

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For citation:
Varnavskii V. A New Concept of the Public-Private Partnerships in the UK. World Eonomy and International Relations, 2014, no. 8, pp. 67-75. https://doi.org/10.20542/0131-2227-2014-8-67-75

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