Quantitative Evaluationon Value For Money For Metro PPP Project

With the rapid development of China’s economy,accelerating of urbanizationand the growing population,the problems such as urban traffic congestion and environmental pollution became increasingly serious.The people’s demand for a good transportation system and a beautiful environment is increasing day by day.Therefore,the transportation infrastructure of metro,which has the characteristics of high efficiency and low pollution,has been paid more and more attention by the state.And many related policies and suggestions have been promulgated to promote the construction of metro.However,the amount of funds required for the construction of metro projects is huge and its payback period is very long.It is difficult for the government’s fiscal fund revenue to fully support its construction.In order to solve this problem,relevant departments have learned from foreign experience and actively introduced a new type of financing mode of PPP to solve this difficulty and the financial pressure has been effectively relieved.Nevertheless,PPP mode is only one of modes which can provide infrastructure products or service,the government needs a scientific analytical approach to determine whether PPP is needed.At present,VFM(Value for Money)known as value for money evaluation methods is common in evaluating the PPP mode.The main purpose of this study is to research the role of risk sharing in the quantitative evaluation of value for money in PPP projects.We construct a quantitative evaluation model of value for money that is consistent with China’s national conditions based onthe results of risk allocation and propose a relatively scientific and effective VFM quantitative calculation method.The government needs a scientific basis to consider whether the project uses the PPP model.In this way,it is of great practical significance to avoid inappropriate projects caused by blind obedience and use the PPP model to cause economic losses and disputes.This study closely integrated the specific characteristics of metro PPP projects and identified the risks of metro PPP projects in the VFM evaluation.It specifically analyzes the important role of the risk allocation part and uses scientific methods to calculate the risk loss and the probability of risk occurrence.A VFM quantitative evaluation model for metro PPP projects is proposed.Finally,the developed model was applies to Dalian subway Line 5 PPP project.This is used to verify the applicability and feasibility of the VFM quantitative evaluation model for metro PPP projects,which can be used by government departments in the construction of metro projects.