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PPP Department within the Ministry of Economy and Transport Government Decree in May 2003 to set up an Interdepartmental

Public Private Partnership. www.gkm.hu www.itd.hu. Government actions to promote PPP. PPP Department within the Ministry of Economy and Transport

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PPP Department within the Ministry of Economy and Transport Government Decree in May 2003 to set up an Interdepartmental

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  1. Public Private Partnership www.gkm.hu www.itd.hu Government actions to promote PPP • PPP Department within the Ministry of Economy and Transport • Government Decree in May 2003 to set up an Interdepartmental Committee • Ministry of Economy and Transport • Ministry of Finance • Ministry of Justice • Prime Minister’s Office • Central Statistical Office

  2. Public Private Partnership www.gkm.hu www.itd.hu Road infrastructure development program • Long-term goal: 2500 km length of expressway network by 2015 • Act CXXVIII on the development of the Hungarian expressway • network (accepted by the Parliament in December 2003) • Deficit constraints => need for alternative ways of financing • PPP projects • EU funds

  3. Public Private Partnership www.gkm.hu www.itd.hu PPP motorways: M5 • Approximately 170 km section between Budapest and the Hungarian - Serbian border • Original concession agreement signed in 1994 with French consortium AKA • First phase (110 km) handed over in 1999 • New agreement reached in March 2004 • Further 60 km section is expected to be built

  4. Public Private Partnership www.gkm.hu www.itd.hu Amended structure of the M5 • Second phase to be built by AKA (estimated cost: EUR 836 million at December 2004 value) • The motorway became part of the national vignette system • DBFO(design-build-finance-operate) structure with risk sharing - construction and availability risks borne by AKA • Availability payment mechanism • Deductions in payments in case of poor performance and safety indices

  5. Public Private Partnership www.gkm.hu www.itd.hu PPP motorways: M6 • Part of the V/c Helsinki corridor • Approx. 252 km section between Budapest and the Hungarian - Croatian border to be built in 2 phases: • first phase between Budapest and Dunaújváros (54 km) by 2006 • second phase between Dunaújváros and the Croatian border (198 km) by 2007

  6. Public Private Partnership www.gkm.hu www.itd.hu PPP motorways: first phase of the M6 • Concession tender won byBilfinger Berger BOT GmbH, Porr Infrastruktur GmbH, Swietelsky International Baugesellschaft mbH • Concession period: 22 years • Timing: • Concession Agreement signed on 2 October 2004 • Target interim completion date: March 2006 • DBFO structure • EIB and EBRD considers providing financing to the concessionaire

  7. Public Private Partnership www.gkm.hu www.itd.hu PPP motorways: financial structure of the M6 • Payment mechanism: • national vignette system • availability payment to the concessionaire • Risk sharing: • International practice • State: discriminatory change in law, delivery of the Site, dangerous materials, etc.; • Concessionaire: design, construction, financing, availability, except relief events; • Shared (vis major)

  8. Public Private Partnership www.gkm.hu www.itd.hu PPP student hostels • Projects of the Ministry of Education • Goal: development of university infrastructure • Government decision on creating 10 000 accommodations in student hostels in the framework of PPP • The pilot project of the University of Debrecen • Classical DBFO structure • Decision of PPP Committee on supporting the project on 30th September 2003 • Approval of the Economic Cabinet and the Government • Public procurement procedure completed, construction is under way • 11 further similar PPP schemes for other universities

  9. Public Private Partnership www.gkm.hu www.itd.hu Prison project of the Ministry of Justice • Goal: the development of prison service infrastructure - two new PPP prisons • DBFO construction • During a period of 15-20 years, 700 prisoner places / prison • „Operate” element: only those tasks are performed by the state which can not be carried out by the private sector (custodial services, on site medical facilities and registering of prisoners) • Positive decision of the PPP Committee: 10th October 2003 • Tender announcement is expected at the beginning of 2005

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