Value For Money Drivers Of PPP Projects

Public-Private-Partnership(PPP)combines decisive role of market in resource allocation and leading role of government in economic and social development.It is widely popularized in infrastructure construction in China.Considering the problems of unreasonable and irregular conducts in PPP projects' practice,the Treasury requires operators to conduct Value for Money(VFM).VFM is the evaluation methodology judging whether PPP model is better than the traditional purchasing mode.Improving VFM can quicken the construction efficiency of PPP projects and has a vital significance to realize the healthy long-term development.It is necessary to research the VFM drivers,in order to find the impetus and source of improving PPP projects VFM.At present,there is not the special findings of VFM drivers of PPP projects.Therefore,this paper expects to combine theory with practice,uses statistical methods to make quantitative analysis about VFM drivers,and explores the relation and effect of VFM drivers.Firstly,the paper summarizes the foreign related literatures about VFM drivers of PPP projects after reviewing the research situation and gives a list of VFM drivers of PPP projects.Then revise the list according to VFM theory and expert interview method and get the final list of 17 VFM drivers of PPP projects.Next,it analyzes the VFM drivers by questionnaire survey and factor analysis.Six principal components are drawn including private factors,public factors,risk factors,cost and benefit factors,project feature factors and project contract factors,that are applied as macro drivers.What's more,there are important VFM drivers and general VFM drivers classified by quantificationally calculating the maximum,minimum,mean and weight.It turns out that private factors are the main macro drivers and reasonable risk allocation is the most important VFM drivers.Based on this,build the influence framework of VFM drivers aimed at improving VFM and put forward the PPP project life-cycle control flow.Therefore,it gives some suggestions to improve VFM in PPP projects.Finally,through the empirical research of PPP project case,it found out the effect of VFM drivers and verified the applicability of the findings in this paper,which can provide a reference to the application and theory research of VFM in PPP projects in China.