The cost of public-private partnerships for the public partner

: the road sector in Portugal

Abstract

(PPPs) are often in the headlines of Portuguese newspapers. In this context, the purpose of this dissertation is to analyze the estimated costs with Public-Private Partnerships projects for the public partner in the road sector. Actually, over the last years, the National State Budgets presented different estimations for these costs. Therefore, I have the objective of assessing if there are explanations for these differences and which factors can affect the estimations. To accomplish this objective I analyzed each project and each State Budget, in order to identify potential reasons for the differences. After identifying the potential factors, that, based on the literature review, are likely to be responsible for the differences in the costs of PPPs, I computed an econometric model. This has as dependent variable the Net Present Value of the estimated costs for each project in each State Budget. Through the data and econometric analysis, one of the conclusions is that the estimated costs depend on the renegotiations verified in recent years. Other results are that a project has higher costs for the public partner if more risks are allocated to it, and that the economic situation of the country affects the estimations. Another reason is that during the period that was analyzed (from the State Budget of 2005 to 2014), new projects with expected costs for the public partner were launched. With this dissertation I identified some challenges for the public partner with the PPP model. As a conclusion, one of the main aspects that it has to improve is the transparency. The State Budgets should disclose more information and mainly explain significant deviations from the previous ones.

Date of Award	2014
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Joaquim Sarmento (Supervisor), Pedro Raposo (Co-Supervisor) & Ricardo Reis (Co-Supervisor)