Closing the infrastructure gap
The role of public-private partnerships
The evidence is everywhere of the large and growing gap between infrastructure needs and historical rates of investment: congested roads; bridges in need of repair; poorly maintained transit systems and recreational facilities and deteriorated hospitals, schools, and waste treatment facilities. These problems in turn impose huge societal costs, from lower productivity and reduced competitiveness, to an increased number of accidents.
Deloitte has released research on the revolution taking place in how this gap is being closed. In the space of a little more than a decade, a paradigm shift has occurred in how governments provide infrastructure. Private financing, design, building, and operation of infrastructure has emerged as one of the most important models employed by many governments to close the infrastructure gap.
While public-private partnerships (PPPs) are unlikely to ever replace traditional infrastructure financing and development, they can be an important tool for governments hoping to address infrastructure shortages because of the benefits they offer. This report outlines the benefits and challenges of, and addresses criticism against, PPPs in the following infrastructure segments:
- waste & water
- public housing/urban regeneration
This study provides a roadmap for governments at all stages of PPP development to take public-private partnerships to the next stage of development. This, in turn, will enable this relatively new delivery model to play a far larger role in closing the infrastructure gaps causing problems for governments across the world.