ABSTRACT
As part of the neo-liberal agenda, Public-Private Partnerships (PPPs) are generally perceived by countries around the world as major innovative policy tools that will remedy the lack of dynamism in traditional public service delivery by increasing investment in infrastructure as well as improving the delivery of social services. Currently, addressing Ghana`s infrastructural deficit and increase demand for basic social services by Ghanaian citizens, public sector will require sustained spending of at least US$1.5billion per annum over decades which government and philanthropic or donor agencies cannot do it all by themselves. Government of Ghana has embraced PPP as a means of leveraging public resources with private sector resource and expertise in order to bridge the infrastructural gap, by delivering public infrastructure and service for the betterment of it citizens. Notwithstanding the immense perceived benefits of PPP concept, several empirical studies showed mixed results largely depending on countries` unique PPP motivational factor(s). Also PPP account giving is a major area that remains an issue of concern for worldwide PPP adopters.
The study draws on resource dependency and neoliberal institutional theories to examine the rationales for PPP adoptions in Ghana and its account giving, focusing on Ghana, a middle income country. To achieve this objective, a qualitative research approach was employed with a case study design. Data were obtained principally through face-to-face interviews with public and private sector actors and beneficiary communities involved in the PPP arrangement. Also policy documents and publicly available information like PPP policy guidelines June (2011), PPP newsletters April (2014; 2015), fact sheets (2011) and selected case conceptual notes as well as PPP affordability analysis were relied upon during the study.
The study results reveal some challenges in PPP account giving as well as some benefits for PPP adoption in Ghana. The challenges include: PPP contractual issues, for example unsolicited project with inherent monopoly, under performance of contractual obligations leading to poor quality of services in the water sector, lack of managerial skills by the public contracting authorities and subsequent failure to ensure effective management of the water purchase agreement. Again, challenges in ascertaining value for money for PPP projects, public affordability concerns and high cost of PPP procurement as well as complexity of project financing scheme. Furthermore, PPP account giving challenges include governance and reporting structure which has culminated in to lack of clarifying accountability relations, poor network of water distributions and negative effect of non-revenue water. In reference to the US$64million University of Ghana (UG) and Africa Integras contract for example, PPP account giving challenges involve problems of stakeholder alignment, construction scope, and arithmetical inaccuracy in project analysis. Other emerging themes include the role of SMEs in PPP procurement in Ghana, project financing schemes and over emphasis on symbolism against cost and benefits analysis. However, the major achievement by the PPP policy adoption is the realization of the PPP project and technological innovative contributions by the private sector. Limitation for the study especially during the period of data collection included business confidentiality clause and the data protection law as well as the signing of non-disclosure agreement. The study therefore concluded that Ghana cannot achieve its motivations for PPP by leveraging public assets and other resource with private sector resources and technical know-how from local and international markets to accelerate the needed investments in infrastructure and services without enhancing PPP account giving in Ghana. The study therefore provides an avenue for government to draw on the findings to formulate pragmatic policies regarding PPP account giving in Ghana.
CHAPTER ONE INTRODUCTION
Background of the Study
PPPs have been encouraged and examined as answers to pressing societal difficulties that call for the comparative advantages of governments and humanity (Watson & Anteneh, 2015; Brinkerhoff & Brinkerhoff, 2011; Pollitt & Bouckaert, 2011; Andonova, 2010) even though it remains how to plan, flourish, and evaluate PPPs (Smyth & Edkins, 2007). Various countries employed varying approaches to conceptualizing PPP. As a result there is no single definition of PPP which most researchers and experts could agree on. Available few definitions in the literature include Grimsey & Lewis, 2002; Klijn & Teisman, 2003; Bovaird, 2004). In United Kingdom it is touted as Private Finance Initiatives (PFI), in India it is called 3P and in South Africa as PPP, all pointing to private participation in the provision of public infrastructure and service (Visser, 2012; Dixit, 2003). How it is conceptualized in Ghana is captured in (Ghana National Policy on PPP, 2011, page 2) as:
―PPP is a contractual arrangement between a public entity and a private sector party, with clear agreement on shared objectives for the provision of public infrastructure and services traditionally provided by the public Sector‖
In Ghana, three clear qualities are articulated to the concept of PPP. PPP is a neoliberal ideology motivating the global spread of an economic model that emphasizes free markets and intensified private sector participation in the delivery of public services and infrastructure inter alia (Agyenim-Boateng, 2012; Steger & Roy, 2010; Whitfield, 2010). ‗Neoliberalism‘ is an expression that is used to include a variety of economic, social, and political ideas, strategies (Gee, 2015), and practices, functioning on both individual and institutional ranks. While neoliberalism refers to a varied group of ideas, practices, and strategies (Gershon et al., 2011) and discursive representations (McCarthy & Prudham, 2004), this collection is united by three
broad opinions: the benevolence of the free market, minimal state intervention and regulation
of the economy, and the individual as a rational economic actor (Saunders, 2010). In a neoliberal world, there is no longer a distinction between the market and the state, between the public and private (Saunders, 2010).
To advance this agenda, public sector was problematized as inefficient, very complex system to deliver on time, lack the right human resources and availability of funds for capital project leading to infrastructural deficit. For example, Ghana needs at least a sustained spending of $1.5 billion per annum over the next decade in order to solve its infrastructure deficit (See, Ghana‘s National Policy on Public Private Partnership, 2011). Proponents of neoliberalism however promoted the private sector by claiming the private sector has a superior problem solving capacity with respect to provision of infrastructure and public services due to power of synergy (Brinkerhoff & Brinkerhoff, 2011). According to Shaoul et al. (2007) and Agyenim-Boateng et al. (2017) there is ex-ante claiming that private sector has adequate financial resources and therefore, the need to attract them. Hence private sector now involved in public policy formulation as well as its implementation (Shaoul et al., 2007).
The supranational institutional support for capacity building in Ghana is part of promoting the neoliberal agenda. For example the World Bank in that respect has provided Ghana with US$ 30million over a four-years period (2012–2016) for capacity building and development of comprehensive programme to fully implement PPP concept and projects in 2017 (Ghana PPP Fact Sheet, 2011). The emphasis on competence has stretched to organisational decision-making, with systems of hierarchical models being dominated by shared governance (Saunders, 2010).
PPPs are usually perceived by various jurisdictions around the globe as major ground-breaking strategy tools that will remedy the lack of vitality in traditional public service delivery by growing commitment in infrastructure as well as enhancing the distribution of social services.
As a result both developed and developing countries have adopted the PPP concept for varying reasons. Firstly, in Democratic Republic of Congo, the cooperation between a state organisation and private sector is established on grounds of major commercial reorganizations (Tati, 2005). Secondly, Brinkerhoff & Brinkerhoff (2011) asserted that in general, individual country actors choose to partner for one or more of the following four reasons:
“to enhance efficiency and effectiveness through a reliance on comparative advantages; to provide the multi-actor, integrated resources and solutions required by the scope and nature of the problems being addressed; to move from a no-win situation among multiple actors to a compromise; and potential win-win situation and to open decision-making processes to promote a broader operationalization of the public good.”
Thirdly, South African public sector adopted PPP as a fundamental strategy in its national and international developmental plan (Miraftab, 2004)The increased use of PPPs has led to issues surrounding their account giving becoming critical. Three main dimensions of accountability that is useful for understanding accountability in PPPs in practice are the hierarchical perspective, the horizontal perspective, and accountability as a virtue (Bovens, 2010). And so if PPPs are to play a vital role in infrastructure development and service delivery, and thus serve public interests, the problem of PPP account giving needs to be addressed (Hodge & Greve, 2007; Forrer, et al., 2010). Solomon (2007) observed that accountability is one of the cornerstones of good governance. Agyenim-Boateng et al. (2017) examine the accounting and governance of PPPs that are structured as joint venture partnerships in United Kingdom (UK). Most of these studies were done with the developed world in mind; also most of them were sector specific for example Agyenim-Boateng‘s study was in the health sector in UK. Furthermore, while most of them provided varying evidences in the developed world they fail to examine rational for PPP adoption and its account giving in the developing world like Ghana.
