Public private partnerships, reevaluating value for money

Research output: Contribution to journalArticle

13 Citations (Scopus)

Abstract

Recession imposes significant pressures on resources, efficiency and effectiveness requiring inevitably, a detailed consideration of what constitutes the current understanding of value for money (VFM). Although a frequently quoted term, the literature indicates the historical development and understanding of VFM within the public private partnering (PPP) context is ambiguous, offering competing understandings. Against this background the study presents, analyses and evaluates quantitative and qualitative data obtained from 50 companies that participated in a web-based survey. Its purpose determined if contractors considered the PPP process constituted VFM. Practitioners’ responses resolved ambiguities around VFM and established which literature confirms the best current understanding. Factors essential to achieving and measuring VFM are considered in detail and clarified including a series of key performance indicators (KPI) listed by Kagioglou et al. (2001). These are shown to perform differently for PPP projects. Conclusions confirm that in recession, practitioners still consider the PPP process constitutes VFM.
LanguageEnglish
Pages152-169
JournalInternational Journal of Procurement Management
Volume6
Issue number2
DOIs
Publication statusPublished - 1 Feb 2013

Fingerprint

Public-private partnerships
Value for money
Public-private
Partnering
Recession
Contractors
Factors
Qualitative data
Web-based
Resource efficiency
Key performance indicators

Keywords

  • value for money
  • VFM
  • public private partnering
  • PPP
  • private finance initiative
  • key performance indicators
  • KPI
  • finance
  • pricing accuracy.

Cite this

@article{9990cba3592a4de2b04f2d3baffb9fb5,
title = "Public private partnerships, reevaluating value for money",
abstract = "Recession imposes significant pressures on resources, efficiency and effectiveness requiring inevitably, a detailed consideration of what constitutes the current understanding of value for money (VFM). Although a frequently quoted term, the literature indicates the historical development and understanding of VFM within the public private partnering (PPP) context is ambiguous, offering competing understandings. Against this background the study presents, analyses and evaluates quantitative and qualitative data obtained from 50 companies that participated in a web-based survey. Its purpose determined if contractors considered the PPP process constituted VFM. Practitioners’ responses resolved ambiguities around VFM and established which literature confirms the best current understanding. Factors essential to achieving and measuring VFM are considered in detail and clarified including a series of key performance indicators (KPI) listed by Kagioglou et al. (2001). These are shown to perform differently for PPP projects. Conclusions confirm that in recession, practitioners still consider the PPP process constitutes VFM.",
keywords = "value for money, VFM, public private partnering, PPP, private finance initiative, key performance indicators, KPI, finance, pricing accuracy.",
author = "Robert Eadie and Phillip Millar and Luke Toner",
note = "Reference text: ACCA (2003) ‘Efficiency or cost saving?’, Public Eye, November, No. 46, available at http://www2.accaglobal.com/archive/public_eye/46/1028882 (accessed in February 2012). Akintoye, A., Hardcastle, C., Beck, M., Chinyio, E. and Asenova, D. (2003) ‘Achieving best value in private finance initiative project procurement’, Construction Management and Economics, Vol. 21, No. 5, pp.461–470. Allen, G. (2001) ‘The private finance initiative (PFI), research paper 01/117’, Economic Policy and Statistics Section, House of Commons Library, available at http://www.parliament.uk/documents/commons/lib/research/rp2001/rp01-117.pdf (accessed on February 2012). Aritua, B., Smith, N. and Bower, D. (2011) ‘What risks are common to or amplified in programmes: evidence from UK public sector infrastructure schemes’, International Journal of Project Management, Vol. 29, No. 3, pp.303–312. Bartlett, J., Kotrlik, J. and Higgins, C. (2001) ‘Organisational research: determining appropriate sample size in survey research’, Information Technology, Learning, and Performance Journal, Vol. 19, No. 1, pp.43–50. Bassioni, H., Price, A. and Hassan, T. (2004) ‘Performance measurement in construction’, Journal of Management in Engineering, Vol. 20, No. 2, pp.42–50. Buse, K. and Walt, G. (2000) ‘Global public-private partnerships – a new development in health’, Bulletin of the World Health Organisation, Vol. 78, No. 4, pp.549–561. Caldwell, N., Roehrich, J. and Davies, A. (2009) ‘Procuring complex performance in construction: London Heathrow Terminal 5 and a private finance initiative hospital’, Journal of Purchasing and Supply Management, Vol. 15, No. 3, pp.178–186. CBI (2007) ‘Going global – the world of PPP’s’, available at http://www.infrastructureaustralia.gov.au/publications/files/going_global_PPPs_UK.pdf (accessed on February 2012). Chan, D. and Kumaraswamy, D. (1997) ‘A comparative study of causes of time overruns in Hong Kong construction projects’, International Journal of Project Management, Vol. 15, No. 1, pp.55–63. Constructing Excellence (2010a) ‘Introduction to KPI’s and benchmarking’, available at http://www.constructingexcellence.org.uk/zones/kpizone/whatisbenchmarking.jsp (accessed on February 2012). Constructing Excellence (2010b) ‘2010 UK industry performance report’, Constructing Excellence, London, UK, available at http://www.constructingexcellence.org.uk/news/pdf_news_articles/ KPIv6.pdf (accessed in February 2012). Coulson, A (2005) ‘A plague on all your partnerships: theory and practice in regeneration’, International Journal of Public Sector Management, Vol. 18, No. 2, pp.151–163. CPD (2004) ‘Public procurement: a guide for small and medium sized enterprizes’, available at http://www.dfpni.gov.uk/index/procurement-2/cpd/cpd-suppliers/cpd-guide-forsmes/pdf_sme_guidance.pdf (accessed on February 2012). De Lemos, T., Betts, M., Eaton, D. and De Almeida, L. (2003) ‘The nature of PFI’, Journal of Structured Finance, Vol. 9, No. 1, pp.59–75. Demirag, I. and Khadaroo, I. (2011) ‘Accountability and value for money: a theoretical framework for the relationship in public-private partnerships’, Journal of Management and Governance, Vol. 15, No. 2, pp.271–296. Dimitri, N. (2012) ‘Working paper no. 2012/02 best value for money in procurement’, Maastricht School of Management, available at ftp://ftp.repec.org/opt/ReDIF/RePEc/msm/wpaper/MSMWP2012- 02.pdf (accessed on February 2012). EC (2011) ‘COM(2011) 896 final. Proposal for a directive of the European Parliament and of the council on/ public procurement, available at http://eurlex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2011:0896:FIN:EN:PDF (accessed on February 2012). Erlendsson, J. (2002) ‘Value for money studies in higher education’, available at http://notendur.hi.is/joner/eaps/wh_vfmhe.htm (accessed on February 2012). Gransberg, D. and Ellicott, M. (1997) ‘Best value contracting criteria’, Cost Engineering, Vol. 39, No. 6, pp.31–34. Grimsey, D. and Lewis, M. (2005) ‘Are public private partnerships value for money?’, Accounting Forum, Vol. 29, No. 4, pp.345–378. HM Treasury (2003) PFI: Meeting the Investment Challenge, HMSO, Norwich. HM Treasury (2007) Value for Money Assessment Guide, HMSO, London. HM Treasury (2010) ‘Public private partnerships’, available at http://www.hmtreasury. gov.uk/ppp_index.htm (accessed on February 2012). HM Treasury (2011) ‘PFI value for money quantitative assessment’, available at http://www.hmtreasury.gov.uk/d/vfm_qe_spreadsheet_122011.xlsm (accessed on February 2012). Hodge, G., Greve, C. and Boardman, A. (2010) International Handbook on Public-Private Partnerships, Edward Elgar Publishing, Cheltenham, Glouster, UK. House of Commons, Committee of Public Accounts (2003) Delivering Better Value for Money from the Private Finance Initiative’, HMSO, London. House of Commons, Committee of Public Accounts (2007–2008) ‘The procurement of the national roads telecommunications services’, HMSO, London, available at http://www.publications.parliament.uk/pa/cm200708/cmselect/cmpubacc/558/558.pdf (accessed on February 2012). IUK (2010) National Infrastructure Plan 2010, available at http://www.hm-treasury.gov.uk/ ppp_national_infrastructure_plan.htm (accessed on February 2012). Jooste, S., Levitt, R. and Scott, D. (2011) ‘Beyond ‘one size fits all’: how local conditions shape PPP-enabling field development’, Engineering Project Organization Journal, Vol. 1, No. 1, pp.11–25. Kagioglou, M., Cooper, R. and Aouad, G. (2001) ‘Performance management in construction: a conceptual framework’, Construction Management and Economics, Vol. 19, No. 1, pp.85–95. Kee, J. and Forrer, J. (2002) ‘Private finance initiative, the theory behind the practice’, Paper presented at the 14th Annual Conference of the Association for Budgeting and Financial Management, 10–12 October, Kansas City, MO. Kishk, M., Al-Hajj, A., Pollock, R., Aouad, G. and Bakis, N. (2002) ‘Whole-life costing in construction – a state of the art review’, The RICS Research Paper Series, Vol. 4, No. 18, available at http://www.rics.org/site/scripts/download_info.aspx?fileID=1818&category ID=450 (accessed on February 2012). KPMG (2010) ‘Delivering value for money through infrastructural change’, available at http://readingroom.lsc.gov.uk/SFA/VFM_Infrastuctural_Change_Report.pdf (accessed on February 2012). Krejcie, R. and Morgan, D. (1970) ‘Determining sample size for research activities’, Educational and Psychological Measurement, Vol. 30, No. 3, pp.607–610. Layard, R. and Glaister, S. (Eds.) (1994) Cost-Benefit Analysis, 2nd ed., Cambridge University Press, Cambridge. Lewis, M. and Roehrich, J. (2009) ‘Contracts, relationships and integration: towards a model of the procurement of complex performance’, International Journal of Procurement Management, Vol. 2, No. 2, pp.125–142. Liu, J. and Cheah, C. (2009) ‘Real option application in PPP/PFI project negotiation’, Construction Management and Economics, Vol. 27, No. 4, pp.331–342. Luu, V., Kim, S. and Huynh, T. (2008) ‘Improving project management performance of large contractors using benchmarking approach’, International Journal of Project Management, Vol. 26, No. 7, pp.758–769. Maltby, P. (2003) ‘The beginning of the end for PFI policy’, The PPP Journal, available at http://www.publicservice.co.uk/article.asp?publication=The{\%}20PPP{\%}20Journal&id=16&content_name=Overview&article=396 (accessed on February 2012). Manu, C. (2005) ‘The principle of value for money in procurement’, available at http://www.ghanaweb.com/GhanaHomePage/features/artikel.php?ID=83959 (accessed on February 2012). Maqsood, T., Khalfan, M. and Aranda-Mena, G. (2012) ‘Do public private partnerships (PPP projects) provide value for money for infrastructure development in Australia?’, in Kathy Michell (Ed.): Delivering Value to the Community, South Africa, 23–25 January, pp.494–501. Meng, X. and Minogue, M. (2011) ‘Performance measurement models in facility management: a comparative study’, Facilities, Vol. 29, Nos. 11/12, pp.472–484. Morledge, R., Smith, A. and Kashiwagi, D. (2006) Building Procurement, Blackwell, London. Moskalyk, A. (2008) ‘The role of public-private partnerships in funding social housing in Canada’, CPRN and SHSC Housing Research Internship and Scholar Program MA, Political Science, University of Western Ontario, available at http://www.cprn.org/documents/50550_EN.pdf (accessed on February 2012). Mott MacDonald (2002) Review of Large Public Procurement in the UK, Mott MacDonald, Croydon. National Audit Office (2003a) PFI: Construction Performance, The Stationery Office, London. National Audit Office (2003b) The Operational Performance of PFI Prisons, Report by the Comptroller and Auditor General, HMSO, London. National Audit Office (2009) Performance of PFI Construction, The Stationery Office, London. Northern Ireland Water (2009) Annual Report, available at http://www.niwater.com/siteFiles/resources/pdf/corporate/1715j{\%}20ni{\%}20water{\%}20a{\%}20report{\%}202010-web.pdf (accessed on February 2012). Office of Government Commerce (OGC) (2001) Getting Value for Money from Procurement, Crown Copyright, London. OGC (2003) Achieving Excellence in Construction Procurement Guide 8 Improving Performance Project Evaluation and Benchmarking, Crown Copyright, London. OGC (2007) Achieving Excellence in Construction Procurement Guide: Sustainability, OGC Crown Copyright, London, UK. Oyegoke, A., McDermott, P. and Abbott, C. (2009) ‘Achieving sustainability in construction through the specialist task organisation procurement approach’, International Journal of Procurement Management, Vol. 2, No. 3, pp.288–313. Oyegoke, A., McDermott, P. and Dickinson, M. (2010) ‘The myth behind integration in the UK construction industry’, International Journal of Procurement Management, Vol. 3, No. 2, pp.247–264. Parker, D. and Hartley, K. (2003) ‘Transaction costs, relational contracting and public private partnerships: a case study of UK defence’, Journal of Purchasing and Supply Management, Vol. 9, No. 3, pp.97–108. Parliament UK (2010) ‘Choosing whether to go ahead with the PFI option’, available at http://www.publications.parliament.uk/pa/cm200203/cmselect/cmpubacc/764/76404.htm (accessed on February 2012). Pitt, M., Collins, N. and Walls, A. (2006) ‘The private finance initiative and value for money’, Journal of Property Investment and Finance, Vol. 24, No. 4, pp.363–373. Rigby, J., Dewick, P., Courtney, R. and Gee, S. (2011) ‘The limits of information? A game theoretic contribution to understanding the development of an indicators policy for the UK construction industry’, Manchester Business School Working Paper, Number 2011, available at http://www.mbs.ac.uk/research/workingpapers/default.aspx (accessed on February 2012). Robinson, H., Carrillo, P., Anumba, C. and Patel, M. (2010) Governance and Knowledge Management for Public-Private Partnerships, John Wiley & Sons, UK. Roe, P. and Craig, A. (2004) Reforming the Private Finance Initiative, Centre for Policy Studies, London. RUSI Defence Systems (2009) ‘The meaning of value for money’, available at http://www.rusi.org/downloads/assets/RDS_Contention_Feb09.pdf (accessed on February 2012). Scottish Government (2005) ‘Public private partnerships in Scotland: evaluation of performance final report 2005’, available at http://www.scotland.gov.uk/Publications/2005/05/05153704/37170 (accessed on February 2012). Smart, V. (2003) ‘PFI: beyond criticism, beyond debate?’, available at http://www.accaglobal.com/members/publications/accounting_business/archive_by_topic/public_sector_accounting/2003/838459 (accessed on February 2012). Spackman, M. (2002) ‘Public-private partnerships – lessons learnt from the British approach’,Construction Economics, Vol. 26, No. 3, pp.283–301. Syuhaida, I. and Aminah, M. (2009) ‘The provision of infrastructure via private finance initiative,in theoretical and empirical researches in urban management’, Special number 1S/April 2009: urban issues in Asia, available at http://www.um.ase.ro/No1S/7.pdf (accessed on May 2012). Toor, S. and Ogunlana, S. (2010) ‘Beyond the ‘iron triangle’: stakeholder perception of key performance indicators (KPIs) for large-scale public sector development projects’, International Journal of Project Management, Vol. 28, No. 3, pp.228–236. TSO (2012) The Green Book: Appraisal and Evaluation in Central Government, TSO Crown Copyright, London, UK, available at http://hm-treasury.gov.uk/d/green_book_complete.pdf (accessed in February 2012). Tunbridge Wells Borough Council (2009) VFM Strategy, available at http://www2.tunbridgewells.gov.uk/default.aspx?page=1385 (accessed on February 2012). UN/ECE (2008) ‘Guidebook on promoting good governance in public-private partnerships’, available at http://unece.org/fileadmin/DAM/ceci/publications/ppp.pdf (accessed in February 2012). Weihe, G. (2008) ‘Ordering disorder: on the perplexities of the partnership literature’, Australian Journal of Public Administration, Vol. 67, No. 4, pp.430–442. Yuan, J. Zeng, Y., Skibniewski, M. and Li, Q. (2009) ‘Selection of performance objectives and key performance indicators in PPP projects to achieve value for money’, Construction Management and Economics, Vol. 27, No. 3, pp.253–270. Zhang, X. (2006) ‘Public clients best value perspectives of public private partnerships in infrastructure development’, Journal of Construction Engineering and Management, Vol. 132,No. 2, pp.107–114.",
year = "2013",
month = "2",
day = "1",
doi = "10.1504/IJPM.2013.052467",
language = "English",
volume = "6",
pages = "152--169",
journal = "International Journal of Procurement Management",
issn = "1753-8432",
number = "2",

}

Public private partnerships, reevaluating value for money. / Eadie, Robert; Millar, Phillip; Toner, Luke.

In: International Journal of Procurement Management, Vol. 6, No. 2, 01.02.2013, p. 152-169.

Research output: Contribution to journalArticle

TY - JOUR

T1 - Public private partnerships, reevaluating value for money

AU - Eadie, Robert

AU - Millar, Phillip

AU - Toner, Luke

N1 - Reference text: ACCA (2003) ‘Efficiency or cost saving?’, Public Eye, November, No. 46, available at http://www2.accaglobal.com/archive/public_eye/46/1028882 (accessed in February 2012). Akintoye, A., Hardcastle, C., Beck, M., Chinyio, E. and Asenova, D. (2003) ‘Achieving best value in private finance initiative project procurement’, Construction Management and Economics, Vol. 21, No. 5, pp.461–470. Allen, G. (2001) ‘The private finance initiative (PFI), research paper 01/117’, Economic Policy and Statistics Section, House of Commons Library, available at http://www.parliament.uk/documents/commons/lib/research/rp2001/rp01-117.pdf (accessed on February 2012). Aritua, B., Smith, N. and Bower, D. (2011) ‘What risks are common to or amplified in programmes: evidence from UK public sector infrastructure schemes’, International Journal of Project Management, Vol. 29, No. 3, pp.303–312. Bartlett, J., Kotrlik, J. and Higgins, C. (2001) ‘Organisational research: determining appropriate sample size in survey research’, Information Technology, Learning, and Performance Journal, Vol. 19, No. 1, pp.43–50. Bassioni, H., Price, A. and Hassan, T. (2004) ‘Performance measurement in construction’, Journal of Management in Engineering, Vol. 20, No. 2, pp.42–50. Buse, K. and Walt, G. (2000) ‘Global public-private partnerships – a new development in health’, Bulletin of the World Health Organisation, Vol. 78, No. 4, pp.549–561. Caldwell, N., Roehrich, J. and Davies, A. (2009) ‘Procuring complex performance in construction: London Heathrow Terminal 5 and a private finance initiative hospital’, Journal of Purchasing and Supply Management, Vol. 15, No. 3, pp.178–186. CBI (2007) ‘Going global – the world of PPP’s’, available at http://www.infrastructureaustralia.gov.au/publications/files/going_global_PPPs_UK.pdf (accessed on February 2012). Chan, D. and Kumaraswamy, D. (1997) ‘A comparative study of causes of time overruns in Hong Kong construction projects’, International Journal of Project Management, Vol. 15, No. 1, pp.55–63. Constructing Excellence (2010a) ‘Introduction to KPI’s and benchmarking’, available at http://www.constructingexcellence.org.uk/zones/kpizone/whatisbenchmarking.jsp (accessed on February 2012). Constructing Excellence (2010b) ‘2010 UK industry performance report’, Constructing Excellence, London, UK, available at http://www.constructingexcellence.org.uk/news/pdf_news_articles/ KPIv6.pdf (accessed in February 2012). Coulson, A (2005) ‘A plague on all your partnerships: theory and practice in regeneration’, International Journal of Public Sector Management, Vol. 18, No. 2, pp.151–163. CPD (2004) ‘Public procurement: a guide for small and medium sized enterprizes’, available at http://www.dfpni.gov.uk/index/procurement-2/cpd/cpd-suppliers/cpd-guide-forsmes/pdf_sme_guidance.pdf (accessed on February 2012). De Lemos, T., Betts, M., Eaton, D. and De Almeida, L. (2003) ‘The nature of PFI’, Journal of Structured Finance, Vol. 9, No. 1, pp.59–75. Demirag, I. and Khadaroo, I. (2011) ‘Accountability and value for money: a theoretical framework for the relationship in public-private partnerships’, Journal of Management and Governance, Vol. 15, No. 2, pp.271–296. Dimitri, N. (2012) ‘Working paper no. 2012/02 best value for money in procurement’, Maastricht School of Management, available at ftp://ftp.repec.org/opt/ReDIF/RePEc/msm/wpaper/MSMWP2012- 02.pdf (accessed on February 2012). EC (2011) ‘COM(2011) 896 final. Proposal for a directive of the European Parliament and of the council on/ public procurement, available at http://eurlex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2011:0896:FIN:EN:PDF (accessed on February 2012). Erlendsson, J. (2002) ‘Value for money studies in higher education’, available at http://notendur.hi.is/joner/eaps/wh_vfmhe.htm (accessed on February 2012). Gransberg, D. and Ellicott, M. (1997) ‘Best value contracting criteria’, Cost Engineering, Vol. 39, No. 6, pp.31–34. Grimsey, D. and Lewis, M. (2005) ‘Are public private partnerships value for money?’, Accounting Forum, Vol. 29, No. 4, pp.345–378. HM Treasury (2003) PFI: Meeting the Investment Challenge, HMSO, Norwich. HM Treasury (2007) Value for Money Assessment Guide, HMSO, London. HM Treasury (2010) ‘Public private partnerships’, available at http://www.hmtreasury. gov.uk/ppp_index.htm (accessed on February 2012). HM Treasury (2011) ‘PFI value for money quantitative assessment’, available at http://www.hmtreasury.gov.uk/d/vfm_qe_spreadsheet_122011.xlsm (accessed on February 2012). Hodge, G., Greve, C. and Boardman, A. (2010) International Handbook on Public-Private Partnerships, Edward Elgar Publishing, Cheltenham, Glouster, UK. House of Commons, Committee of Public Accounts (2003) Delivering Better Value for Money from the Private Finance Initiative’, HMSO, London. House of Commons, Committee of Public Accounts (2007–2008) ‘The procurement of the national roads telecommunications services’, HMSO, London, available at http://www.publications.parliament.uk/pa/cm200708/cmselect/cmpubacc/558/558.pdf (accessed on February 2012). IUK (2010) National Infrastructure Plan 2010, available at http://www.hm-treasury.gov.uk/ ppp_national_infrastructure_plan.htm (accessed on February 2012). Jooste, S., Levitt, R. and Scott, D. (2011) ‘Beyond ‘one size fits all’: how local conditions shape PPP-enabling field development’, Engineering Project Organization Journal, Vol. 1, No. 1, pp.11–25. Kagioglou, M., Cooper, R. and Aouad, G. (2001) ‘Performance management in construction: a conceptual framework’, Construction Management and Economics, Vol. 19, No. 1, pp.85–95. Kee, J. and Forrer, J. (2002) ‘Private finance initiative, the theory behind the practice’, Paper presented at the 14th Annual Conference of the Association for Budgeting and Financial Management, 10–12 October, Kansas City, MO. Kishk, M., Al-Hajj, A., Pollock, R., Aouad, G. and Bakis, N. (2002) ‘Whole-life costing in construction – a state of the art review’, The RICS Research Paper Series, Vol. 4, No. 18, available at http://www.rics.org/site/scripts/download_info.aspx?fileID=1818&category ID=450 (accessed on February 2012). KPMG (2010) ‘Delivering value for money through infrastructural change’, available at http://readingroom.lsc.gov.uk/SFA/VFM_Infrastuctural_Change_Report.pdf (accessed on February 2012). Krejcie, R. and Morgan, D. (1970) ‘Determining sample size for research activities’, Educational and Psychological Measurement, Vol. 30, No. 3, pp.607–610. Layard, R. and Glaister, S. (Eds.) (1994) Cost-Benefit Analysis, 2nd ed., Cambridge University Press, Cambridge. Lewis, M. and Roehrich, J. (2009) ‘Contracts, relationships and integration: towards a model of the procurement of complex performance’, International Journal of Procurement Management, Vol. 2, No. 2, pp.125–142. Liu, J. and Cheah, C. (2009) ‘Real option application in PPP/PFI project negotiation’, Construction Management and Economics, Vol. 27, No. 4, pp.331–342. Luu, V., Kim, S. and Huynh, T. (2008) ‘Improving project management performance of large contractors using benchmarking approach’, International Journal of Project Management, Vol. 26, No. 7, pp.758–769. Maltby, P. (2003) ‘The beginning of the end for PFI policy’, The PPP Journal, available at http://www.publicservice.co.uk/article.asp?publication=The%20PPP%20Journal&id=16&content_name=Overview&article=396 (accessed on February 2012). Manu, C. (2005) ‘The principle of value for money in procurement’, available at http://www.ghanaweb.com/GhanaHomePage/features/artikel.php?ID=83959 (accessed on February 2012). Maqsood, T., Khalfan, M. and Aranda-Mena, G. (2012) ‘Do public private partnerships (PPP projects) provide value for money for infrastructure development in Australia?’, in Kathy Michell (Ed.): Delivering Value to the Community, South Africa, 23–25 January, pp.494–501. Meng, X. and Minogue, M. (2011) ‘Performance measurement models in facility management: a comparative study’, Facilities, Vol. 29, Nos. 11/12, pp.472–484. Morledge, R., Smith, A. and Kashiwagi, D. (2006) Building Procurement, Blackwell, London. Moskalyk, A. (2008) ‘The role of public-private partnerships in funding social housing in Canada’, CPRN and SHSC Housing Research Internship and Scholar Program MA, Political Science, University of Western Ontario, available at http://www.cprn.org/documents/50550_EN.pdf (accessed on February 2012). Mott MacDonald (2002) Review of Large Public Procurement in the UK, Mott MacDonald, Croydon. National Audit Office (2003a) PFI: Construction Performance, The Stationery Office, London. National Audit Office (2003b) The Operational Performance of PFI Prisons, Report by the Comptroller and Auditor General, HMSO, London. National Audit Office (2009) Performance of PFI Construction, The Stationery Office, London. Northern Ireland Water (2009) Annual Report, available at http://www.niwater.com/siteFiles/resources/pdf/corporate/1715j%20ni%20water%20a%20report%202010-web.pdf (accessed on February 2012). Office of Government Commerce (OGC) (2001) Getting Value for Money from Procurement, Crown Copyright, London. OGC (2003) Achieving Excellence in Construction Procurement Guide 8 Improving Performance Project Evaluation and Benchmarking, Crown Copyright, London. OGC (2007) Achieving Excellence in Construction Procurement Guide: Sustainability, OGC Crown Copyright, London, UK. Oyegoke, A., McDermott, P. and Abbott, C. (2009) ‘Achieving sustainability in construction through the specialist task organisation procurement approach’, International Journal of Procurement Management, Vol. 2, No. 3, pp.288–313. Oyegoke, A., McDermott, P. and Dickinson, M. (2010) ‘The myth behind integration in the UK construction industry’, International Journal of Procurement Management, Vol. 3, No. 2, pp.247–264. Parker, D. and Hartley, K. (2003) ‘Transaction costs, relational contracting and public private partnerships: a case study of UK defence’, Journal of Purchasing and Supply Management, Vol. 9, No. 3, pp.97–108. Parliament UK (2010) ‘Choosing whether to go ahead with the PFI option’, available at http://www.publications.parliament.uk/pa/cm200203/cmselect/cmpubacc/764/76404.htm (accessed on February 2012). Pitt, M., Collins, N. and Walls, A. (2006) ‘The private finance initiative and value for money’, Journal of Property Investment and Finance, Vol. 24, No. 4, pp.363–373. Rigby, J., Dewick, P., Courtney, R. and Gee, S. (2011) ‘The limits of information? A game theoretic contribution to understanding the development of an indicators policy for the UK construction industry’, Manchester Business School Working Paper, Number 2011, available at http://www.mbs.ac.uk/research/workingpapers/default.aspx (accessed on February 2012). Robinson, H., Carrillo, P., Anumba, C. and Patel, M. (2010) Governance and Knowledge Management for Public-Private Partnerships, John Wiley & Sons, UK. Roe, P. and Craig, A. (2004) Reforming the Private Finance Initiative, Centre for Policy Studies, London. RUSI Defence Systems (2009) ‘The meaning of value for money’, available at http://www.rusi.org/downloads/assets/RDS_Contention_Feb09.pdf (accessed on February 2012). Scottish Government (2005) ‘Public private partnerships in Scotland: evaluation of performance final report 2005’, available at http://www.scotland.gov.uk/Publications/2005/05/05153704/37170 (accessed on February 2012). Smart, V. (2003) ‘PFI: beyond criticism, beyond debate?’, available at http://www.accaglobal.com/members/publications/accounting_business/archive_by_topic/public_sector_accounting/2003/838459 (accessed on February 2012). Spackman, M. (2002) ‘Public-private partnerships – lessons learnt from the British approach’,Construction Economics, Vol. 26, No. 3, pp.283–301. Syuhaida, I. and Aminah, M. (2009) ‘The provision of infrastructure via private finance initiative,in theoretical and empirical researches in urban management’, Special number 1S/April 2009: urban issues in Asia, available at http://www.um.ase.ro/No1S/7.pdf (accessed on May 2012). Toor, S. and Ogunlana, S. 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PY - 2013/2/1

Y1 - 2013/2/1

N2 - Recession imposes significant pressures on resources, efficiency and effectiveness requiring inevitably, a detailed consideration of what constitutes the current understanding of value for money (VFM). Although a frequently quoted term, the literature indicates the historical development and understanding of VFM within the public private partnering (PPP) context is ambiguous, offering competing understandings. Against this background the study presents, analyses and evaluates quantitative and qualitative data obtained from 50 companies that participated in a web-based survey. Its purpose determined if contractors considered the PPP process constituted VFM. Practitioners’ responses resolved ambiguities around VFM and established which literature confirms the best current understanding. Factors essential to achieving and measuring VFM are considered in detail and clarified including a series of key performance indicators (KPI) listed by Kagioglou et al. (2001). These are shown to perform differently for PPP projects. Conclusions confirm that in recession, practitioners still consider the PPP process constitutes VFM.

AB - Recession imposes significant pressures on resources, efficiency and effectiveness requiring inevitably, a detailed consideration of what constitutes the current understanding of value for money (VFM). Although a frequently quoted term, the literature indicates the historical development and understanding of VFM within the public private partnering (PPP) context is ambiguous, offering competing understandings. Against this background the study presents, analyses and evaluates quantitative and qualitative data obtained from 50 companies that participated in a web-based survey. Its purpose determined if contractors considered the PPP process constituted VFM. Practitioners’ responses resolved ambiguities around VFM and established which literature confirms the best current understanding. Factors essential to achieving and measuring VFM are considered in detail and clarified including a series of key performance indicators (KPI) listed by Kagioglou et al. (2001). These are shown to perform differently for PPP projects. Conclusions confirm that in recession, practitioners still consider the PPP process constitutes VFM.

KW - value for money

KW - VFM

KW - public private partnering

KW - PPP

KW - private finance initiative

KW - key performance indicators

KW - KPI

KW - finance

KW - pricing accuracy.

UR - http://www.inderscience.com/jhome.php?jcode=ijpm#issue

U2 - 10.1504/IJPM.2013.052467

DO - 10.1504/IJPM.2013.052467

M3 - Article

VL - 6

SP - 152

EP - 169

JO - International Journal of Procurement Management

T2 - International Journal of Procurement Management

JF - International Journal of Procurement Management

SN - 1753-8432

IS - 2

ER -