Can the private finance initiative be used in emerging economies? – lessons from the UK’s successes and failures.

Handley-Schachler, Morrison and Gao, Simon S (2003) Can the private finance initiative be used in emerging economies? – lessons from the UK’s successes and failures. Managerial Finance, 29 (5/6). pp. 36-51. ISSN 0307 4358

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The Private Finance Initiative (PFI) introduced in the UK in 1992 has provided the framework for the completion of a large number of capital projects managed by public sector bodies. The objectives of the PFI included the promotion of greater efficiency and cost control in the management of large-scale projects, the transfer of risks to the sector or organisation best able to manage them and the use of management skills available in different sectors of the economy to improve the effectiveness of publicly funded projects. Success and failure cases of the PFI discussed in this paper give some implications to policy-makers in emerging economies in various areas including risk management, cost of capital measurement and transfer of risks. Overall, there is a need for a greater focus on long term budgets in making decisions about PFI and other methods of public service provision. The question of long term planning is likely to be more complicated in emerging economies with rapid growth rates. For many emerging economies, PFI is a new premise with fundamental differences from conventional public finance, not only in principles, but also in the contract process, risk consideration and decision making.

Item Type: Article
Print ISSN: 0307 4358
Electronic ISSN: 1758-7743
Uncontrolled Keywords: risk management; public sector; outsourcing; finance; contracts; United Kingdom; developing countries;
University Divisions/Research Centres: The Business School > School of Accounting, Economics and Statistics
Dewey Decimal Subjects: 300 Social sciences > 330 Economics > 338 Production
600 Technology > 650 Management & public relations > 658 General management
Library of Congress Subjects: H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
H Social Sciences > HG Finance
Item ID: 2089
Depositing User: RAE Import
Date Deposited: 18 Feb 2008 11:53
Last Modified: 13 Jun 2013 15:02

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