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The primary attraction of PPPs: their potential to remain off the public balance sheet or reduce reported impact of capital investment on headline debt metrics. By structuring long-term payment commitments as service fees or availability charges, governments spread recognition across decades, preserving the short-term appearance of fiscal restraint despite long-term inflexibility.
A conventional public investment requires immediate debt recognition. A PPP with identical long-term fiscal impact may avoid this through contractual structuring, making it politically and fiscally attractive regardless of its economic superiority.
ABS Section 4.1