Devolution and PPP's

Devolution and PPPs

Adrian Eakin meets Northern Ireland's four main political parties to find out what the future holds for Public Private Partnerships.

Devolution and PPPs

Few would argue that the political parties' position on the economy has not traditionally been at the top of the agenda for Northern Irish voters. With the Assembly up and running, however, and details of the economic package from Gordon Brown beginning to emerge, many in the business community are now wondering where the parties stand on key economic issues. Of particular interest is Northern Ireland's substantial infrastructure deficit and what plans the Executive may have for PPPs, not least because it recently inherited live PPP schemes such as Workplace 2010 and new hospitals in Enniskillen and Omagh.

Policy

In terms of political ideology, neither the DUP nor the UUP has any objection to PPPs and both are supportive of such schemes in certain circumstances - they both stress the need to scrutinise each particular project on a case by case basis to ensure overall value for money. Sinn Féin and the SDLP on the other hand are opposed to PPPs and in policy terms aim to raise resource through direct taxation and deliver all public services from the public purse. Ideology aside, however, all the parties admit to having a pragmatic openness to finding the best way of funding much needed improvements in public services and no one disputes that capital constraints may well dictate the need for private finance in certain sectors (as Martin McGuinness found as Minister for Education). When, on affordability grounds, the question is PPP or nothing, the reality is that ideology sometimes has to take second place.

The parties were largely united on their concerns about PPPs. Value for money and the terms of staff transfers were all key issues, and mention was made of issues surrounding the existing schemes at the RVH Car Park and Wellington College & Balmoral High School. No party claimed to fully understand the complexities of PPPs or the various types, for example, some involving no staff transfers or private finance and they all expressed interest without scepticism in last year's National Audit Office statistics which showed that over 70% of conventional schemes were late and over budget compared with around 22% of PPP schemes. Many wondered why more wasn't done to balance negative PR on PPPs with this type of information.

The SIB

All parties spoke positively about the Strategic Investment Board's energy in driving matters forward, acknowledging the need for resource and expertise in the public sector. The over-riding question was how the organisation's ability to do business will differ now that local Ministers and MLAs will be closer to the decision making process. All parties perceived that the SIB's frustration at the lack of progress in certain areas had created a degree of tension within the system and felt that more work was needed to bring key people along with SIB thinking going forward.

The Future

With devolution finally in place, the parties accept that there are now a lot of issues at play. Many politicians now need to make the jump from Council business to Assembly business, develop further thinking on complex strategic and economic issues and work hard to address the likely left-right divide in topical issues such as water charges, where the parties disagree on whether users should be charged according to usage or earnings. Whilst there is lots of room for disagreement on these types of issues, the parties all claim that working relationships are sound and point to the recent cross-party meetings on the economic package as an example of joined-up thinking. Joined-up or not, however, the DUP and Sinn Féin, as the two largest political parties in the Assembly, know that they will shoulder much of the blame if Northern Ireland doesn't begin to prosper.

Adrian is a Partner in the firm's Corporate Department and leads the firm's Projects Group. He is currently advising on a number of infrastructure schemes including Belfast Schools, Roads DBFO II and the Leicester BSF Project.

Adrian can be contacted at adrian.eakin@lestrangeandbrett.com

Quote: parties were ......... united on their concerns