1 / 19

Briefing on the operation and management of Public Private Partnerships (PPP)

Briefing on the operation and management of Public Private Partnerships (PPP). SCOPE Introduction Fundamental principles Parties to the concession contract Current status Scope of operations Risk profile Management of operations Budget Challenges. INTRODUCTION

shanta
Download Presentation

Briefing on the operation and management of Public Private Partnerships (PPP)

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Briefing on the operation and management of Public Private Partnerships (PPP)

  2. SCOPE • Introduction • Fundamental principles • Parties to the concession contract • Current status • Scope of operations • Risk profile • Management of operations • Budget • Challenges

  3. INTRODUCTION • The two PPP Correctional Centres were opened in 2001 & 2002 respectively. • The main rationale behind the initiative was to improve on the cost effectiveness of the correctional system by making additional accommodation available, more quicker and flexibly than would otherwise be possible.

  4. 2. FUNDAMENTAL PRINCIPLES • Value for money: Accomplished by significant risk transfer and quality of services that are procured. • Risk transfer: Design Construction Maintenance Funding • Affordability

  5. PARTIES TO THE CONTRACT • MANGAUNG PPP CENTRE LENDERS Investec Bank Ltd ABSA Bank Ltd RSA GOVERNMENT 25 year custodial services • SHAREHOLDERS • Old Mutual (20%) • G4s (20%) • 10 Alliance Mangaung (20%) • Fikile Mangaung (20%) • Ikhwesi Community Trust (20%) BLOEMFONTEIN PRISON FINANCE TRUST BLOEMFONTEIN CORRECTIONAL CONTRACTS (Pty) LTD

  6. 3. PARTIES TO THE CONTRACT KUTAMA-SINTHUMULE CENTRE LENDERS First Rand Bank Ltd BOE Merchant Bank RSA GOVERNMENT 25 year custodial services • SHAREHOLDERS • South African Custodial • Management • Kensani Corrections (50%) SOUTH AFRICAN CUSTODIAL SERVICES SECURITY TRUST SOUTH AFRICAN CUSTODIAL SERVICES (Pty) LTD

  7. 4. CURRENT STATUS • Mangaung Correctional Centre • Contractor : G4S( previously GSL) • Date opened: 01 July 2001 • Certified normal accommodation : 2928 • Population: 2928 • Type of Correctional Centre: Maximum • Contractual period: 25 years

  8. 4. CURRENT Status( Cont) • Kutama-Sintumule Correctional Centre • Contractor: SACM • Date opened: 01 March 2002 • Certified normal accommodation: 3024 • Population: 3024 • Type of Correctional Centre: Maximum • Contractual period: 25 years

  9. 5.SCOPE OF OPERATIONS • Schedule A, B, C Construction Equipment( quality & quantity) Maintenance • Schedule D Operational Specification Goal 1: keep inmates in safe custody Goal 2: maintaining order, control, discipline and safe environment. Goal 3: providing decent conditions and meeting inmates’ needs.

  10. 5.SCOPE OF OPERATIONS (continue) • Goal 4: providing structured day programme • Goal 5: preparing inmates for their return back to the community • Goal 6: delivering prison services • Goal 7: community involvement

  11. 6. RISK PROFILE • Design and construction Delays in construction- no payment until completed Failure to provide facility as specified Cost overruns on construction • Maintenance Facility not properly maintained Costs related to maintenance more than anticipated • Operations Contractor fails to meet performance standards

  12. 6. Risk Profile ( cont) • Insurance • Insurance against third parties • Availability of bed spaces • Less available places than contractually specified DCS pays only for available spaces • Technology changes • Improvement in technology which reduces the operational costs DCS secures reduction in contract fee. • Financial • Increase in the CPI increases contractor fees • Residual Value • Facility reverts back to DCS but has a designed life of 50 years • Staffing • Contractor solely responsible for Human Resources matters

  13. 7. MANAGEMENT OF OPERATIONS DIRECTORATE CONTRACT MANAGEMENT DIRECTOR CONTRACT MANAGEMENT (MJ MAAKO) DEPUTY DIRECTOR CONTRACT POLICY FORMULATION (MJ KOTO) DEPUTY DIRECTOR CONTRACT COMPLIANCE (JDE BASSON) DEPUTY DIRECTOR CONTRACT INFORMATION PROVISION (VACANT)

  14. 7.1. QUALITY & QUANTITY CONTROL OF SERVICES • Governed by contract (concession & direct agreement) between the two parties. • Contracted operators to function independently. • DCS Contract Management Directorate to act as a regulatory body that must manage the contracts and ensure that inspections and audits are performed regularly at the two PPP Correctional Centres. • Regional Commissioners to have oversight function on the management of the two centres.

  15. 7.2. MONITORING • Correctional Services Controller Monitors operations Monitors empowerment related issues of contract • Supervisory Committee: To rule on the merits of the notices of breach and the extent of penalties To undertake the annual review • Inspectorate, Audit & Auditor–General’s Office To conduct inspections and audits on the two Correctional Centres • Judicial Inspectorate To facilitate the inspection of the Correctional Centres & report on the treatment of inmates in prisons and on conditions and any corrupt or dishonest practices.

  16. 7.2. Monitoring (cont) • Directorate Contract Management To monitor contract compliance( operations & empowerment) To conduct site visits To attend to operational and empowerment meetings with contractors To attend quarterly meetings with Corrections & Contractors • Penalties • Fixed penalties= 0 • Variable penalties= 0

  17. 8. BUDGET ACTIVITY: PPP CORRECTIONAL CENTRES: FINANCIAL YEAR 2009/2010 • Goods & Services Indexed fee = R 566 459 700,00 • Payment on Capital Assets Fixed fee = R 194 734 273,00

  18. 9. CHALLENGES • Gang fights • Hunger strikes • Re-classification of inmates • Requests for transfers • Provision of ARV’s • Medical releases

  19. Business Unusual: all hands on deck to detain, rehabilitate and reintegrate offenders for a safer South Africa

More Related