Analysis & Recommendations for PPP
Legal & Institutional Framework
Mauritius PPP Support
May 13, 2010
Submitted By:
The Institute for Public-Private Partnerships, Inc.
1611 North Kent Street, Suite 700
Arlington, VA 20007 USA
Tel: 1 (202)-466-8930
Fax: 1 (202) 466-8934
www.ip3.org
1611 North Kent Street, Suite 700, Arlington, VA 22209 USA
T. 1-202-552-0909 | F. 1-202-466-8934 | www.ip3.org
Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Contents
CONTENTS ............................................................................................................................................................ 2
1. EXECUTIVE SUMMARY .................................................................................................................................... 1
2. INTRODUCTION & BACKGROUND: MAURITIUS PPP SUPPORT PROJECT ............................................. 31
2.1 Background and Purpose of the Mauritius PPP Support Project ...................... 31
2.2 The Mauritius PPP Context: Past PPP Framework and Pilot Initiatives ........... 31
2.3 The Objectives of this Consultancy ........................................................................ 33
3. ASSESSMENT AND RECOMMENDATIONS FOR PPP POLICY IN MAURITIUS .......................................... 35
3.1 Assessment of Mauritius’ PPP Policy Framework: .............................................. 35
3.2 Gaps within Mauritius’ PPP Policy Framework:.................................................... 38
3.3 The Need to Strengthen Mauritius’ PPP Policy Foundation: .............................. 41
3.4 Recommended Action: Update and Adopt a Revised, Strengthened PPP
Policy Statement: ............................................................................................................. 43
3.5 Justification & Estimated Benefits of Implementing the Recommendation: ..... 44
3.6 Options for Implementation: Can the same Results be Achieved without
Implementing a New PPP Policy Statement?.............................................................. 46
3.7 Recommended Plan of Action: ................................................................................ 48
4. ASSESSMENT & RECOMMENDATIONS FOR PPP LEGAL FRAMEWORK ................................................ 52
4.1 Understanding the Scope of Mauritius’ Legal Framework for PPPs: ................ 52
4.2 The Key Components of the Current PPP Legal Framework: ........................... 53
4.3 Assessment of Issues & Constraints within the Current PPP Legal Framework:
............................................................................................................................................. 59
4.4 Evaluating the Options for Strengthening the PPP Legal Framework: ............. 65
4.5 Recommendation: Draft New PPP Act and PPP Implementing Regulations .. 67
5. ASSESSMENT AND RECOMMENDATIONS FOR DESIGN AND ORGANIZATION OF THE PPP UNIT AND
PPP COMMITTEE ................................................................................................................................................ 74
5.1 The Current Design & Institutional Roles of PPP Organizations: ...................... 75
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
5.2 Recommended Actions: Recruit and Hire a Chief Executive, a Resident PPP
Adviser, and a PPP Framework & Capacity-Building Manager for the PPP Unit .. 82
6.
PPP PROJECT EVALUATION AND PREPARATION PROCEDURES: .................................................... 89
6.1 The Current Process for Preparing and Evaluating PPPs in Mauritius: ........... 89
6.2 Constraints to PPP Preparation & Evaluation Process: ...................................... 97
6.3 Recommendations: Design, Draft, and Disseminate a new Guidance Manual
of PPP procedures ........................................................................................................... 98
6.4 Justification & Estimated Benefits of Implementing the Recommendation: ..... 99
8.
ACTION PLAN FOR ESTABLISHING A PANEL OF PPP EXPERTS ..................................................... 106
7.1 Rationale & Objectives for a Panel of PPP Experts:.......................................... 106
7.2 Lessons Learned from International Experiences with Establishing Panels of
PPP Advisers: ................................................................................................................. 108
7.3 Recommended Organizational Structure for a Panel of PPP Experts for
Mauritius .......................................................................................................................... 114
7.4 ACTION PLAN to Establish a PPP Panel of Experts: Key Steps .................... 117
9.
CLARIFYING THE TREATMENT OF UNSOLICITED PPP PROPOSALS .............................................. 129
8.1 The Role of Unsolicited Proposals in PPP: ......................................................... 129
8.2 International Lessons Learned in the Treatment of Unsolicited PPP Proposals:
........................................................................................................................................... 132
8.3 Current Procedures for Handling Unsolicited PPP Proposals: ........................ 134
8.4 Recommendation: Establish the capacity of the new PPP Unit to evaluate and
manage unsolicited PPPs and design and draft a new PPP Unit regulation on the
handling of unsolicited PPP proposals. ...................................................................... 139
9. ASSESSMENT AND RECOMMENDATIONS FOR PPP INFORMATION FLOW, TRAINING & CAPACITY
BUILDING .......................................................................................................................................................... 145
9.1 PPP Information Flow, Training & Capacity Building ......................................... 146
9.2 Recommendation: Design & Implement Comprehensive PPP Capacity
Building Program ............................................................................................................ 149
10. ASSESSMENT AND RECOMMENDATIONS FOR STRENGTHENING MAURITIUS’ PRIVATE SECTOR
CAPACITY FOR IMPLEMENTING PPPS .......................................................................................................... 154
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
10.1 Mauritius Private Sector Organizations: ............................................................ 155
10.2 Private Sector Concerns Over PPP Framework and Projects in Mauritius . 155
10.3 Recommendation: Establish a PPP Forum for Key Public & Private Sector
Leaders ............................................................................................................................ 157
11. RECOMMENDED WORK PLAN FOR THE PPP UNIT ................................................................................ 161
APPENDIX A: DETAILS OF SPECIFIC PPP LEGAL AND INSTITUTIONAL CHANGES SINCE PPP POLICY
STATEMENT 2003 ............................................................................................................................................. 166
APPENDIX B: COMPARISON OF CURRENT PPP POLICY STATEMENT (2003) WITH CONTENTS OF
RECOMMENDED PPP POLICY ........................................................................................................................ 168
APPENDIX C: ADDITIONAL COMPONENTS OF MAURITIUS’ PPP POLICY FRAMEWORK - POLICY
REFERENCES TO PPP IN RECENT BUDGET SPEECHES ............................................................................ 177
APPENDIX D: STATUTORY ROLES OF GOVERNMENT INSTITUTIONS UNDER CURRENT PPP LEGAL
FRAMEWORK .................................................................................................................................................... 181
APPENDIX E: IDENTIFICATION OF CURRENT GAPS & CONSTRAINTS IN MAURITIUS’ PPP-RELATED
LAWS & REGULATIONS................................................................................................................................... 188
APPENDIX F: RECOMMENDED APPROACH TO DRAFTING PPP LAW ....................................................... 233
APPENDIX G: RECOMMENDED CONTENTS OF THE NEW DRAFT PPP ACT ............................................. 236
Part I Preliminary ............................................................................................................ 237
Part II Public Private Partnership Arrangements ...................................................... 237
Part III The Public Private Partnership Unit Of Mauritius ......................................... 240
Part IV Financial Reporting Accounting and Auditing .............................................. 241
Part V Public Private Partnership Committee ............................................................ 242
Part VI PPP Forum ........................................................................................................ 242
Part VII Miscellaneous ................................................................................................... 243
APPENDIX H: TERMS OF REFERENCE FOR RESIDENT PPP ADVISER...................................................... 244
APPENDIX I: TERMS OF REFERENCE FOR A PPP FRAMEWORK DEVELOPMENT & CAPACITYBUILDING MANAGER ....................................................................................................................................... 248
APPENDIX J: TERMS OF REFERENCE FOR SHORT-TERM CONSULTANT TO SUPPORT LAUNCHING OF
PANEL OF PPP EXPERTS ................................................................................................................................ 252
APPENDIX K: TERMS OF REFERENCE FOR PPP UNIT CHIEF EXECUTIVE ............................................... 255
APPENDIX L: RECOMMENDED PPP PROJECT IDENTIFICATION SELECTION TOOL FOR THE PPP UNIT THE PPP PROJECT MATRIX ............................................................................................................................ 258
APPENDIX M: LIST OF ORGANISATIONS SUBJECT TO THE PUBLIC PROCUREMENT ACT ................... 264
APPENDIX N: RELEVANT EXTRACTS FROM PUBLIC PROCUREMENT ACT 2006 FOR PPP PANEL OF
EXPERTS ........................................................................................................................................................... 266
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APPENDIX O: RELEVANT EXTRACTS FROM PUBLIC PROCUREMENT REGULATIONS FOR PANEL OF
PPP EXPERTS ................................................................................................................................................... 273
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
1. Executive Summary
The following summarizes the key findings, the recommendations, and their
rationale for each of the eleven (11) sections of this report:
Section 2: Background and Purpose of the Mauritius PPP Support Project
The Public-Private Infrastructure Advisory Facility (PPIAF) approved a grant to
support the Government of Mauritius (the “Government”) in improving the
framework for Public-Private Partnerships (PPPs) and strengthening the PPP project
pipeline. This grant is managed and administered by the World Bank’s Mission in
Port Louis.
This report contains a review, analysis and recommendations for strengthening the
policy, legal, and institutional framework for PPPs in Mauritius as required by the
terms of reference for the assignment. These recommendations are designed to
overcome the specific constraints identified and analyzed and to expand PPP
opportunities to promote economic and social infrastructure development.
The Government desires to strengthen and improve PPP legal and institutional
framework. The foundations for the success of that move are laid out in this report
and should be built upon through discussion with PPP stakeholders to ensure a
common understanding of priorities, needs and concerns. The Government, the
World Bank, and the consulting team, agreed that the focus of this assignment
should be the analysis of the PPP legal and institutional framework in Mauritius
with specific recommendations for improvement set out in a work plan. A separate
assignment would then follow to implement the Government’s decisions on these
specific recommendations.
The scope of work for this consultancy set out two main deliverables:
1. Analysis & Review of PPP Legal & Institutional Framework: A systematic assessment
of the current framework of PPP policies, laws & regulations, institutions, and
procedures and specific recommendations for how the PPP framework should be
improved in the form of a work plan. This report provides:
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework



A description and analysis of the key PPP framework issues
When relevant, potential options for addressing each issue are identified,
described, and analysed.
A recommended action plan for each framework element presented in a
common format as requested by the Government
2. Identification & Preparation of Potential PPP Projects: Identify, in consultation with
the Government, a “long-list” of potential PPP projects and to select and prepare PPP
assessments for 10 PPP candidate projects. These assessments are not PPP feasibility
studies. Instead, they are reviews of the available information on each project, which
assess whether a project would make a suitable candidate for further preparation and
implementation through a PPP arrangement. Importantly, these assessments provide
recommend actions for undertaking the next steps for the detailed analysis, riskstructuring, review, and possible tendering of each PPP candidate project.
This second component of this Mauritius PPP Support has been submitted under a separate
volume entitled, “Identification and Preparation of Potential PPP Projects.”
Section 3: Assessment & Recommendations for PPP Policy in Mauritius
In spite of considerable efforts, the level and pace of PPP project construction and
operation has been less than expected and below what is required to fulfill the need
in Mauritius for improved, expanded, and more competitive infrastructure. There is
a need to address a list of specific differences in understanding as to what PPP is,
how quickly projects can be delivered, why PPP can play a beneficial role and the
changes to implementing machinery and measures that are required to enable PPP
to provide improved infrastructure facilities and services.
Restating PPP policy will help bring about a sustainable acceleration in the
implementation of a coherent set of actions to improve infrastructure facilities and
services through successful PPP projects. The restatement will bring a common
understanding of PPP goals and help promote public sector and private sector
capacity to identify and realize potential PPP projects. Restating policy will provide
a sound basis for revising and improving PPP legislation as set out later in the
report.
Recommended Action: Revise the PPP Policy
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
The recommended outline and key contents of revised PPP Policy Statement include:
1. PPP Arrangements – definition
2. Scope of application - specify who may enter PPP arrangements and what sectors and
activities may be the subject of PPP arrangements
3. Goals of PPP policy
4. PPP and competitiveness
5. Risk sharing, affordability and value for money
6. Fiscal Risk, Guarantees and Contingent Liabilities
7. PPP Institutional Framework I: Establishment, functions, powers, staffing, reporting and
accountability of “PPP Unit”, “PPP Steering Committee”, “PPP Stakeholders Forum”
8. PPP Institutional Framework II: Roles, responsibilities and relationships: “PPP Unit”,
“PPP Steering Committee”, MOFEE, Line Ministries and other Contracting Authorities,
Regulatory bodies, Public Procurement
9. PPP Capabilities, Techniques and Tools
10. PPP and Public Expenditure
11. PPP Programme and Pipeline and Investment Planning
12. PPP and Regulation
13. Stakeholder consultation and participation
14. PPP Project Cycle – preparation, PPP feasibility, procurement, contracts, financing,
construction, operation
15. PPP approvals and decisions
16. Unsolicited PPP proposals
17. Project development funding
18. Disclosure and Reporting
19. Accounting for PPP
20. Auditing and Review of PPP for Value for Money Performance
21. Monitoring and evaluation of PPP projects and PPP programme
22. Contract Management, Adjustment and Renegotiation
23. Dispute Resolution
24. Legislation (Act and regulations), Procedures, Guidelines and Instructions
25. Standardised PPP Agreements
26. PPP Manual
Estimated impacts & benefits from implementing a new PPP Policy Statement
include:
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework



A strengthened PPP Policy Statement would eliminate the current level of
confusion and misunderstandings that existing between Government bodies
(including the PPP Unit, the PPO, the PPP Committee, MOFEE, PPC, Line
Ministries, and Contracting Authorities) about the definition of PPP, which is
currently blocking progress on PPP projects such as the Bigara Wind farm
project.1
A strengthened PPP Policy Statement will provide a clear basis for
development of a clearer PPP Law
An updated and strengthened PPP Policy Statement will provide a common
understanding between both Govt. and the private sector in Mauritius on the
purpose of PPPs, the principles for their preparation and implementation.
Currently private sector leaders in Mauritius’ financial institutions, property
development, industrial, and sugar industries have reported they lack
confidence in the Government’s framework for PPPs and are unwilling to
propose new PPPs, and doubtful that current PPPs such as the Port Louis
Road Decongestion Project will work. Such a clearer statement would
provide the foundation for addressing these important long-term constraint
to PPPs in Mauritius.
Options for Implementing Changes to PPP Policy:
The two options available for implementing these recommended changes to PPP
Policy are:
1. Seek to revise the PPP Policy through administrative mechanisms
2. Seek an new, official, revised and updated PPP Policy Statement
It should be noted that these two approaches are not mutually exclusive. It is
possible for the Government to pursue the option of making specific changes to the
existing PPP Policy according to the recommendations in the short-term through
ministerial administrative mechanism, while pursuing a longer-term strategy
developing a more comprehensive revision of the PPP Policy. While the Consultant
Team recommends that the best way for Mauritius realize the greatest potential
benefits of a more effective PPP framework will be through a new, rather than an
amended PPP Policy, it will be possible for the Government to still realize important
1
An independent power project, such as the proposed Bigara wind farm project, which would receive
payment from CEB under a power purchase agreement does not fit within the current PPP Act definition of
PPP.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
improvements in its PPP programme by implementing these changes through the
simpler administrative process, such as the issuances of a ministerial decree.
The revision of the PPP policy should be implemented as part of the preparation of
the revised legislation (described and recommended below). In effect the PPP policy
will be equivalent to instructions that would be given to a parliamentary draftsman
when preparing legislation, rather than undertaking the Policy and PPP legislation
as two separate exercises.
Section 4: Assessment of PPP Legal Framework
The PPP legal framework in Mauritius is broader than the PPP Act. It includes the
interface with legislation on public financial management, public procurement, the
regulations and procedures for operating the PPP project cycle including PPP
procurement, the relationships between different Government authorities relevant
to PPP, the PPP legal agreements, contract monitoring and auditing.
A comprehensive PPP law should set out a general legal framework on which
regulations, procedures, guidelines and instructions and a PPP Manual can be built
to enable best practice PPP procurement. The primary legislation should avoid
unnecessary prescription or problematic omissions but much of the detail can be left
to regulations, guidelines and procedures or to the agreement for the PPP
arrangement.
The PPP Act 2004, the absence of PPP Regulations made under the PPP Act, the later
enactment of the Public Procurement Act 2006 and Public Procurement Regulations
2008, amendments in 2008 to the PPP Act and Public Procurement Act and
amendments to the PPP Regulations in 2009 have resulted in the legal framework
for PPP being disjointed, incomplete, repetitive in parts and yet not comprehensive.
A complete list of these gaps, weaknesses, and constraints in all of the components
of the PPP Act is provided in Appendix E below.
The main purposes of PPP primary legislation in the form of a PPP Act would be to:

Provide an enabling law for PPP that addresses obstacles and providing certainty for the
private sector and general public
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework


Address the roles and responsibilities of different parts of Government in PPP matters
Establish Government institutions to advise and assist on PPP arrangements
Recommendation: Revise the PPP Act and its Implementing Regulations
Specific Actions:
1. In accordance with the established process for initiating the preparation of draft
legislation in Mauritius, the PPP Unit is given authority to prepare revisions to the PPP
Act and its Implementing Regulations in consultation with stakeholders and specialist
legal advice within different parts of Government.
2. PPP Unit’s new PPP Framework & Capacity Building Manager engages the support of a
specialized PPP legal adviser. (For consistency, coherence and synergy the PPP policy,
legal and institutional individual advisers should be part of one team that examines each
of these subject areas).
3. Revisions to the PPP Act and Regulations are prepared and submitted for consideration
by the PPP Committee, the Finance Secretary before being revised and circulated for
observations within Government.
4. The PPP Act is revised, either through amendment in the Finance (Miscellaneous
Provisions) Act, or through submission as a New Bill before the National Assembly.
5. Annual evaluation review of the PPP Law is conducted by the PPP Unit, supported by
specialists as necessary, to determine if it should be further modified and improved.
Options for Implementing Changes to PPP Law and Implementing Regulations:
The two options available for implementing these recommended changes to PPP Act
are:
1. Seek to amend the PPP Act through administrative mechanisms
2. Draft, debate, pass, and enact a new PPP Act
It should be noted that these two approaches are not mutually exclusive. It is
possible for the Government to pursue the option of making specific changes to the
existing PPP Act according to the recommendations in the short-term through
ministerial administrative mechanism, while pursuing a longer-term strategy
developing a new PPP Policy. While the Consultant Team recommends that the best
way for Mauritius realize the greatest potential benefits of a more effective PPP
framework will be through a new, rather than an amended PPP Act and
implementing regulations, it will be possible for the Government to still realize
important improvements in its PPP capacity by implementing these changes
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
through the simpler administrative process, such as inclusion of changes in the
Finance (Miscellaneous Provisions) Act.
It is recommended that one team of specialists who understand PPP policy, legal
and institutional matters should be retained work on the revisions to the PPP policy
and the revisions to the PPP Law. Both of these tasks should proceed together.
Otherwise there will be an elongated time frame as different advisers are engaged
sequentially for each of these steps and moreover, there is a high probability of
delays to reconcile what will almost inevitably be variations in approach or
emphasis favoured by the various advisers.
Section 5: The Design and Organization of the PPP Unit & PPP Committee
The PPP Unit was established in 2002, and its role was set out in the PPP Policy
Statement 2003 and in the PPP Act 2004 (prior to amendments). The PPP Unit
initially reported on PPP matters through MOFEE’s Finance Secretary. However,
amendments to the PPP Act in 2008 have required the PPP Unit to report to a PPP
Committee, consisting of representatives from the Public Procurement Office, and
the MOFEE.
Although under-resourced, the PPP Unit currently has the following functions:





Works with contracting agencies to select and analyze potential PPP projects
Together with contracting agencies, oversees PPP transaction advisors and a
portfolio of the six PPP projects currently being prepared for tendering and
the ten additional candidate projects being analyzed.
Coordinates the process of analyzing the existing PPP legal and institutional
framework, proposing changes, and the design and implementation of a new
PPP framework
Helps coordinate the PPP training and capacity-building needs of Mauritius
Serves as the source of information on PPP issues, projects throughout
Mauritius for the private sector, donors, and within the Government
The recommended new functions of the PPP Unit should include:
Encourage Contracting Authorities to consider public private partnership
arrangements as a method of procuring infrastructure;
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
1. Advise and assist Contracting Authorities on all aspects of public private partnership
arrangements;
2. Review and evaluate proposals for projects and advise the PPP Committee on
identifying if public private partnership is the most appropriate means of implementing
a project;
3. Advise and assist the PPP Committee:
o In reviewing public private partnership policy and programmes on policy,
o In pricing and regulatory issues that may have an impact on public private
partnership arrangements having consulted with the appropriate regulatory
authorities;
o On options and reforms, including regulatory reforms, to remove barriers
and make public private partnership arrangements more efficient; and
o On mechanisms for financing investment in public private partnership
arrangements;
4. Coordinate the implementation of public private partnership policy, programme and
projects by the Government and local-level Governments;
5. Build capacity in State Authorities for public private partnership arrangements and
promote good practice and knowledge sharing with State Authorities and the private
sector;
6. Serve as Mauritius’ “PPP Knowledge Center” by maintaining a central repository of all
documentation and records, including agreements, about public private partnership
arrangements;
7. Compile and submit to the Minister on a quarterly basis a record of payments, receipts,
liabilities, including contingent liabilities, guarantees and other information connected
with public private partnership arrangements;
8. Act as secretariat to the PPP Committee and the PPP Forum;
9. Issue procedures, guidelines and instructions in relation to public private partnership
arrangements; and
10. Perform any other function concerning public private partnership arrangements or
infrastructure procurement or development that:
o The Minister for Finance requests the PPP Unit in writing to perform; or
o That is incidental or ancillary to any of its functions.
Recommendation: Recruit and Hire for the PPP Unit a Resident PPP Adviser, a PPP
Framework & Capacity-Building Manager, and a Chief Executive for the PPP Unit
1. Strengthen the PPP Unit according to the recommended functions described above.
2. The PPP Unit should hire a PPP Resident Adviser to coordinate and manage the Unit’s
activities in helping identify new PPP project and helping contracting authorities to
review the work of PPP transaction advisors. A key purpose of this position will be to
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
transfer important PPP transaction oversight and management skills, models, and
procedures to other members of the PPP Unit Team. When available, the Resident PPP
Adviser will be expected to advise on the PPP Unit’s other activities, such as
strengthening the PPP legal and institutional framework, and conducting PPP capacitybuilding events. A full copy of the recommended Terms of Reference for recruiting this
Resident PPP Adviser is included in Appendix H of this Report. The specific framework
development responsibilities of this Resident PPP Adviser include:
o Identifying new PPP projects in Mauritius
o Screening identified projects for the suitability to be analyzed as PPP
candidates;
o Preparing terms of reference of PPP consultants and transaction
advisers to conduct PPP project screening analyses, feasibility studies,
tenderings, and other specific tasks;
o Reviewing PPP consultant and transaction advisor qualifications and
proposals and selecting preferred bidders
o Supervising and reviewing PPP feasibility analyses, including Public
Sector Comparison (PSC) and Value for Money (VfM) analyses, and
PPP project risk-allocation structures;
o Supervising and reviewing PPP transactions through tendering and
financial closure;
o Evaluating PPP proposals from private developers
o Communicating with private lenders and investors on PPP investment
requirements, financing strategies, and opportunities
o Designing, drafting and establishing key models, documents, and
standardized procedures for the PPP Unit to screen, analyze, structure,
tender, complete, and monitor PPP transactions.
3. The PPP Unit should hire a new PPP Framework and Capacity-Building Manager. This
experienced Manager will dedicate approximately 50% of his/her time to coordinating
the PPP Unit’s Work Plan activities that deal with strengthening the PPP legal and
institutional framework. A full copy of the recommended Terms of Reference for recruiting
this Manager is included in Appendix I of this Report. The specific framework development
responsibilities of this Manger include:
o Managing the PPP Unit’s work plan of activities in strengthening the
legal & institutional framework
o Coordinating the development, drafting, communication, and
adoption of a strengthened PPP policy statement
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
o Coordinating the development, drafting, communication, and
adoption of a strengthened PPP Act and associated implementing rules
and regulations
o Coordinating the development of the PPP Unit’s organizational
procedures, including the development an updated Manual of PPP
Guidelines
o Coordinating the establishment of a PPP Forum of key public and
private sector leaders to ensure better communication and cooperation
on PPPs in Mauritius
o Preparing terms of reference for and overseeing the activities of PPP
legal and institutional specialists engaged to assist the PPP Unit’s
framework development activities
o Communicating with public and private sector leaders and the press
on Mauritius’ PPP framework.
4. The MOFEE should create the position of Chief Executive of the PPP Unit to coordinate
and overseas all of the PPP Unit’s activities and staff in accordance with the new power,
duties, and functions to be given to the PPP Unit through the revised PPP Act. A full
copy of the recommended Terms of Reference for recruiting this Chief Executive is included in
Appendix K of this Report. The specific framework development responsibilities of this
Chief Executive would include:
o Overseeing the execution of the PPP Unit’s entire work plan of
activities, including the preparation and completion of PPP
transactions, the strengthening the legal & institutional framework,
PPP capacity-building, and other special PPP initiatives.
o Ensuring that the Government’s overall process of preparing,
structuring, approving, tendering, awarding, and signing PPP
contracts is effective and efficient.
o Supervising the Resident PPP Adviser’s coordination of the PPP Unit’s
project identifications, screening, feasibility analysis, tendering, and
completion of PPP projects and transactions
o Supervising the PPP Framework Development & Capacity-Building
Manager’s coordination of the PPP Unit’s policy, legal, institutional,
and capacity-building initiatives.
o Executing the management of the PPP Unit’s budget and reporting
functions
o Officially representing the PPP Unit on its Governmental Committees,
including specific PPP project committees, the PPP Forum, special
training & capacity-building events sponsored by the PPP Unit, etc.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
o Ensuring the effective knowledge-transfer and on-the-job-training
occurs from the Resident PPP Advisor and any other PPP specialists to
the staff of the PPP Unit, to ensure the long-term capacity of the PPP
Unit as an institution.
o Effectively representing the PPP Unit to private infrastructure sector
investors and lenders interested in bidding on PPP opportunities.
o Communicating with public and private sector leaders and the press
on Mauritius’ PPP framework and PPP projects.
3. Initiate stakeholder consultations on the proposed policy, legal and institutional
framework and develop a communications strategy to ensure smooth adoption of
policy and enactment of legislation and institutional changes.
4. The PPP Unit should continue to work on existing portfolio of PPP projects but
apply the improved approaches being developed.
5. Annual evaluation review of the PPP Unit’s design is conducted by an outside PPP
institutional specialist, to determine if the Unit organization or operations should be
modified and improved.
Section 6: PPP Project Evaluation and Preparation Procedures
An important current constraint to PPPs in Mauritius is the required series of
procedures and approvals for PPP projects. The two figures below depict the
sequence of steps in the current PPP process carried out by the different institutions.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Figure 1. Process Flow for the Current PPP Project Life-Cycle in Mauritius
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
This sequence of steps and approvals, summarized above, has generally grown in a
“bottom-up” fashion as interest in PPPs in Mauritius has grown during the past
decade, and as new initiatives and institutions like the PPC and PSIP have been
created and have been added to the PPP process. Moreover, there is still on-going
confusion and debate between several of these key Government organizations on
just what this required process and sequences of steps is.
As a result, leaders in both Government and the private sector in Mauritius have
found the current process to be cumbersome, often hampered by delays, as well as
difficult to understand – all of which make PPPs appear less attractive as an option
to be explored. What is needed is a new, rigorous “top-down” approach to
restructuring the required process for evaluating, preparing, approving, and
implementing PPPs. This should be reflected in a revised new PPP Guidance
Manual.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Recommendation: Implement the following Changes to PPP Procedures
1. To improve the process for the identification of new PPP projects the head of the PPP
Unit should be appointed to sit on the Projects Plan Committee (PPC).
2. Restructure the composition, role and functions of the PPP Committee with wider and
deeper functions. These new functions are described in Section 5.1
3. Replace the Central Procurement Board role in PPP procurement with the PPP
Committee operating with an enhanced role and functions.
4. Provide that professional advisers on PPP projects should be advisers to the
Government through the PPP Committee and not advisers to contracting authorities.
Advisers are not engaged to carry out PPP procurement on behalf of contracting
authorities but to continually advise Government on whether PPP procurement
provides better value for money than traditional procurement.
5. Enable the PPP Unit directly to engage advisers on PPP arrangements.
6. Require that the Debt Management Office in MOFEE should carry out PPP fiscal risk
assessment.
7. Specify clear and certain roles and responsibilities for PPP Unit, PPP Committee,
MOFEE (Debt Management Unit - fiscal risk), contracting authorities, and Cabinet in
PPP Project Cycle and relationships between these entities to streamline approvals,
decision-making and implementation.
8. Revise and update the PPP Guidance Manual to reflect the new recommended changes
to PPP preparation and evaluation procedures
9. Conduct annual evaluation review of the PPP procedures is conducted by an outside
PPP institutional specialist to determine if it should be modified and improved.
Why these New PPP Procedures are Needed:
These recommended changes to the PPP project preparation and evaluation process
will accelerate the PPP project cycle for the following reasons.




Removal of Central Procurement Board from the PPP procurement process
will eliminate a layer of decision-making that is currently constrained by
limited experience with PPP output standards and evaluation criteria;
An improved and more robust legal and institutional framework brought
about through the proposed changes in this report can bring certainty and
credibility to key steps of the new process;
Better resourced PPP Unit with ready access to professional advisers will be
better able to manage projects through completion;
The new PPP Unit will be better able lead and drive the process rather than
waiting to be asked to provide advice and assistance;
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework



Improved capability through contracting authorities and PPP Unit in
techniques such as capital appraisal and cost benefit analysis;
The comprehensive suite of Procedures, Guidelines and Instructions, PPP
Manual including template forms and standardised contract provisions and
the building of institutional knowledge and experience will strengthen,
streamline and accelerate the workings of the PPP Project Cycle;
The general public will have more confidence in a transparent and
accountable process that has high standards of disclosure and reporting
requirements;
Because of these changes and improvements decision-making will be swifter as
participants in the PPP process, including the private sector investors, operators and
lenders, will be more certain of the process and will have greater confidence in the
higher quality analysis, findings, reports, recommendations and outcomes that the
process produces.
Section 7: Recommended Action Plan for the Design & Establishment of a Panel of
PPP Experts:
The current framework for PPPs in Mauritius, as articulated by both the PPP Policy
Statement of 2003 and also the PPP Act of 2004 (amended), features an important
role to be played by PPP transaction advisors. This approach is consistent with
international best practices. Countries like the United Kingdom, South Africa,
Australia and others that have been implementing PPPs for well-over a decade also
utilize outside PPP advisors to both complete PPP feasibility analyses as well as to
conduct and manage PPP tenders.
However, currently the process for retaining PPP transaction advisors in Mauritius
can take up to 6 months to complete, delaying progress in the completion of
important PPP projects. One solution that has realized some success in other
countries is the establishment of a “Panel” of pre-qualified PPP transaction advisors
and other consultants to improve both the speed and the quality of PPP advisors.
Recommendation: Implement Action Plan for the Design & Establishment of a
Panel of PPP Experts:
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
1. Confirm the legality of pre-qualifying advisors in accordance with the Public
Procurement Act of 2006. The Public Procurement Act 2006 and Public Procurement
Regulations 2008 permits restricted bidding for goods, other services and works but not
for consultancy services (see Sections 15(1)(a)(ii) and 19 of the Act and Regulation 41
included as Appendices 1 and 2 at the end of this Response Document). Regulation 42
provides for the establishment and management of a standing list for use in restricted
bidding. The Act provides that the standing list can be amended at any time – it is not a
list that is closed for a specified time. To empanel pre-qualified consultants, such as for PPP
feasibility studies and transaction advisory services, the Public Procurement Act would need to
be amended.
2. Prepare a Draft RFQ and Develop a Marketing Plan: Once the Action Plan for the Panel
has been approved, and the legality of the creation of the Panel has been satisfied, is the
development of the Request for Qualifications (RFQ) Documents as well as marketing
plan to generate interest in the bidders both locally and internationally. The
recommended outline for the RfQ includes:
a. Cover Letter & Introduction
b. GoM Policy Objectives and Parameters for PPP in Mauritius
c. Goal and Purpose of the PPP Panel of Experts
d. Defining Eligible Consultants and Experts
e. Description of the Nature of the "Indefinite Quantity Contract"
3. Establish the Operational Guide for the PPP Panel of Experts: This Guide should be
distributed together with the RfQ document. Recommended contents include:
a. Defining the Process of Establishing the List
b. Defining the Evaluation Criteria
c. Describing the Evaluation and Review Process
d. Defining the Process of Award and the "Re-submittal Phase"
e. Managing the Panel of Experts and Defining "Base Contracts"
f. Issuing of Task Orders and Types of Assignments Required
g. Procuring Task Orders
h. Cost Information and Proposals
i. RFQ Proposal Instructions
j. Defining Minimum Qualifications for Proposals
k. Proposed PPP Panel of Experts Project Manager
l. Mandatory Requirements and Use of Local Experts
m. Submission Requirements and Inquiries
n. Bidders Conference
o. RFQ Terms and Conditions: Reservation of GOM Rights
p. Defining "Best Interest of GOM"
q. Cost of Preparation of Proposals
r. Confidentiality Clause
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
s. RFQ Disclosure and Conflict of Interest
t. Transparency and Liability
4. Issuing the Announcement for Interested firms to Request the RfQ (sample provided)
5. Evaluating Submitted PPP Qualifications according to recommended evaluation
criteria
6. The Panel becomes operational and task order requests are prepared and issued by
the PPP Unit
Section 8: Clarifying the Treatment of Unsolicited PPP Proposals
A key objective of PPPs in Mauritius is to encourage greater innovation in its
infrastructure and public services sectors. One way that many countries have
chosen to encourage such innovation is through allowing unsolicited proposals for
PPPs to be submitted by private sector developers.
The main risk to accepting unsolicited PPP proposals is that Governments usually
award them to the original private sector proponent without sufficient transparency
or the benefits of meaningful competition. As a result, the general public tends to
view unsolicited projects as serving special interests and/or associated with
corruption. Private proponents often propose projects with the specific objective of
avoiding a competitive process. If the private proponent is granted exclusivity for
the project, the private proponent will usually sole-source and negotiate the project
specifics with the government behind closed doors. Unsolicited Proposals do not
necessary have to be awarded to the original proponent or negotiated directly. There
are four manners in which PPP projects can be awarded, including having an
unsolicited proposal pass through a transparent, competitive system where other
competing proposals have a chance of being awarded the project.
Recommendation: Establish the capacity of the new PPP Unit to evaluate and
manage unsolicited PPPs and design and draft a new PPP Unit regulation on the
handling of unsolicited PPP proposals.
Specific Actions:
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
The capacity of the PPP Unit to quickly evaluate unsolicited proposals needs to be
increased through:
1. As recommended in Section 5.1 above appoint both a PPP Framework & CapacityBuilding Manager and a Resident PPP Adviser.
2. The PPP Framework Specialist oversees the design of the unsolicited proposal
procedure, supported by the advice of the Resident PPP Adviser. The PPP Unit may
choose to engage an experienced PPP procurement specialist as a consultant to focus on
supporting the completion of this activity
3. Provide detailed training for the staff of the PPP Unit on PPP project evaluation
techniques and models (note that this action is also recommended in Section 6 below on
PPP capacity building)
4. Establish a Panel of pre-qualified PPP transaction advisors that the PPP Unit can rapidly
turn to with request to evaluate unsolicited proposals (as recommended in Section 5.3
above).
5. Conduct annual evaluation reviews of the unsolicited proposals by the PPP Unit,
supported by outside specialists as necessary, to determine if the unsolicited proposals
mechanism should be modified and improved.
Section 9: Improving PPP Information Flow, Training & Capacity Building
Although the Government of Mauritius has a number of important public
documents available on its existing PPP policy, legal, and institutional framework,
there is still a wide-spread lack-of-awareness within the public sector about the PPP
framework in particular and about PPP structuring techniques generally. The result
has not only been a low number of new PPP projects identified and selected in
Mauritius, but also delays within the Government in the analysis, preparation,
tendering, approval, and completion of PPPs. Mauritius’ PPP framework needs to
include a comprehensive strategy for providing training and capacity-building on
PPP concepts, techniques, and skills not only to the managers and leaders of public
sector bodies (ministries, contracting authorities, and parastatals), but also to
representatives of Mauritius’ private sector and its non-governmental organizations.
This is a function that the PPP Unit should take the lead in coordinating and
managing, working together with specialized PPP training institutions.
Additionally resources will be needed to enable the PPP Unit to coordinate and
manage this effort as well as to access the outside PPP training specialists that can
design and deliver these services.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Recommendation: Design & Implement Comprehensive PPP Capacity Building
Program
Specific Actions:
1. Hire the new PPP Framework and Capacity-Building Manager for the PPP
Unit to oversee and coordinate this activity.
2. Identify a single body to take the lead in developing Mauritius’ PPP capacity
building and training. The PPP Unit could establish a partnership or
cooperative agreement with a local training institution to develop this PPP
training capacity and to conduct training activities
3. Organize a series of PPP training models that are closely linked to the Phases
of the PPP life-cycle as defined by Mauritius’ new PPP Guidance Manual.
Training should be conducted to address the needs of two different groups:
o In-Depth training on PPP techniques should be offered to PPP
Unit staff, PPP project managers at line ministries and
contracting authorities, and for members of the PPP Committee
o Introductory-level training on PPP concepts should be offered
to other senior policy-makers and officials not intensively
involved with structuring PPPs
4. Prepare model PPP training materials and train trainers to be able to conduct
PPP training workshops when needed
5. The goal of this initiative should be to use PPP training and capacity-building
activities to support the completion of specific PPP transactions first, rather
than to simply introduce a broad range of officials to general or introductory
PPP concepts and models. Therefore, the first activities should consider
supporting the process to complete the current portfolio of PPP transactions
being prepared and evaluated in Mauritius including:
o Public facilities development,
o Road transportation, and
o Energy generation projects.
The next round of activities should consider supporting the capacity of
analysing PPPs in sectors like water, wastewater, electricity, fisheries,
hazardous waste management, and roads.
6. Seek formal partnership relationships with 3-4 other international training
organizations that support and could help sponsor PPP training for Mauritius
such as:
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
o The World Bank Institute’s Multilateral Public-Private
Partnerships in Infrastructure Capacity Building (MP3IC),
o The Development Bank of Southern Africa’s (DBSA) Vulindlela
Academy,
o The Southern African Development Community’s (SADC)
Banking Association
o The African Development Bank’s Vice Presidency for
Infrastructure and Private Sector, which is launching a new
PPP Strategy, including support for PPP capacity-building,
together with the AfDB’s Joint Economic Institute.
7. Offer 2-3 introductory-level PPP training programs per year
8. Offer 2-3 new in-depth PPP training workshops per year in support of other
specific PPP projects and transactions
9. Conduct annual evaluation reviews of PPP capacity building program by
outside training specialists to determine if the program should be modified
and improved.
Section 10: Strengthening Cooperation with Mauritius’ Private Sector for
Implementing PPPs
The framework for PPPs will need clear support and active participation from the
local private sector in Mauritius in order to be sustainable. In addition to bidding on
PPP tenders and providing equity and debt to local PPP investments, local private
firms should be invited to work with the Government to structure the procedures
and rules of the game for completing PPPs. While some larger PPP investment
projects in Mauritius will likely require international investors, lenders, and
contractors, there will be numerous medium-sized projects that will be implemented
by local developers and lenders.
However, the local private sector has identified a number of important concerns that
should be addressed in any renewed approach to PPPs in Mauritius:

There is very limited capacity in the Government to manage the entire
process of selecting, analysing, structuring, tendering and completing PPP
transactions.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework





The current sequence of procedures to prepare, review, approve and
complete PPPs lacks clarity, and is too time-consuming and inefficient.
Any efforts to improve or restructure Mauritius PPP framework should have
clear, active, and visible support from the highest levels of the Government,
specifically from the Cabinet and the Prime Minister. Some in the private
sector see this as the 3rd effort to establish a PPP framework (after the
Concession Project Act of 1997 and the PPP Act of 2004); if it is to be
successful this time, it must be backed by a high-level commitment from
Government.
To show its commitments to working in long-term partnership with the
private sector, the Government should refrain from its calls to renegotiate
previous PPP contracts, specifically the country’s first four power purchase
agreements signed with private sugar industries in the 1990’s. This raises
important concerns about the Government’s willingness to honor future longterm PPP contracts.
The private sector’s own knowledge of PPPs and how to analyze risks (like
market demand risks) and structure bankable PPPs also need to be increased
The current unsolicited projects incentive of receiving a 10% “bonus” on price
evaluations is generally not attractive to private developers and is seen as
impractical implement.
While there are opportunities for both the private sector and the Government to
meet and discuss issues related to PPP projects and issues, there is no formal
mechanism for its coordination. Moreover, some leaders in Government have
maintained that there already are adequate opportunities for Government and the
private sector to communicate on issues related to PPP in Mauritius, several private
sector leaders do not share this assessment. To address this constraint, what is
needed is a mechanism to ensure on-going and effective communication on PPPs in
Mauritius.
Recommendation: Establish a PPP Forum for Key Public & Private Sector Leaders
Specific Actions:
1. As part of approving the new PPP Policy and the new PPP Law, The PPP Committee
and the MOFEE Finance Secretary task the PPP Unit with the design and establishment
of a PPP Forum.
2. PPP Unit’s PPP Framework Development and Capacity-Building Manager will be
responsible for overseeing the design a new PPP Forum. For example, the PPP Forum
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
would be required to meet twice per year to ensure regular communication on
important PPP issues between the public and private sectors.
3. First meeting of the PPP Forum is held, managed by the PPP Unit, featuring leaders
from both the public and private sectors.
4. The first PPP Forum’s recommendations and results are evaluated by the PPP Unit for
inclusion in PPP framework initiatives.
5. Conduct annual evaluation reviews of the PPP Forum by outside specialists to
determine if the Forum’s design or operation should be modified and improved.
CONCLUSION: Options for Implementing Key PPP Framework Recommendations:
For two of the key components of this consultancy, particularly those regarding PPP
Policy and PPP Law, the Government has expressed that any recommendations to
prepare an entirely new PPP Policy Statement or to draft, debate, pass, and enact a
new PPP Law would not only take too long to complete and that nearly the same
results could be achieved through simpler administrative mechanisms.
While the Consultant Team recommends that the best way for Mauritius realize the
greatest potential benefits of a more effective PPP framework will be through both a
new, rather than an amended PPP Policy as well as new, rather than an amended
PPP Act and implementing regulations, it will be possible for the Government to
still realize signficant improvements in its PPP capacity by implementing these
changes through the simpler administrative process, such as inclusion of changes in
the Finance (Miscellaneous Provisions) Act.
Section 11: Summary Recommended Work Plan for the PPP Unit:
The practical focal point for coordinating the implementation of all of these
recommended activities is the PPP Unit. Clearly the human and financial resources
of the PPP Unit will need to be expanded to enable to coordinate and oversee these
important initiatives. As noted previously, terms of reference are provided as
annexes to this report for the recruitment and hiring of key staff for the PPP Unit,
including:
1. Resident PPP Adviser
2. PPP Framework Development & Capacity-Building Manager
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
3. Chief Executive of the PPP Unit
The Government of Mauritius should therefore be prepared to allocate adequate
support to the PPP Unit to implement a new work plan whose major initiatives
would include:
 Overseeing the revisions to and strengthening of Mauritius’ new PPP Policy
Framework
 Overseeing the revisions to and strengthening of Mauritius’ new Legal
Framework,
 Overseeing the development and establishment of a new, more efficient
system of PPP project evaluation and preparation procedures.
 Playing a leading role in initiating contact with line ministries, contracting
authorities, and parastatals to identify, screen, prepare and implement an
expanded portfolio of PPP projects for Mauritius.
 Coordinating the implementation of a broader new PPP training, capacitybuilding, and information-sharing initiative for leaders and managers from
Mauritius’ public sector, private sector, non-governmental sector, and others.
 Develop models and procedures to ensure that there are adequate capacity
and procedures for PPP project performance monitoring, contract
compliance, and service delivery.
The following implementation schedules summarize timeframes for the key
activities that comprise the recommended work plan for the PPP Unit.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Mauritius PPP Support Project – Review of Terms of Reference and its
Completion through the Contents of this egal & Institutional Framework Report:
Terms of Reference
A full review of the institutional and legal
frameworks for PPPs. The PPPs law is relatively
recent, but it is unclear how far it incorporates
international best practice and to what extent it
would facilitate the high priority now accorded
PPPs in Mauritius. This should include streamlining
and optimizing the roles of different players in a
typical PPP transaction e.g. the Government
procurement office, the technical ministries, the
contracting authorities, statutory bodies, MoF
(financial risk management), private sector, etc.
Examine whether additional incentives are needed
to encourage PPPs and, if so, what should they look
like.
Assess the current PPP law to determine whether:
(1) it incorporates the relevant elements of
international best practices; (2) what could be
done to improve the legal framework and
regulations; (3) what gaps exist; and (4) what
further alternations should be considered in terms
of the legal and regulatory framework;
Assess the PPP unit and associated institutional
mechanisms and recommend ways of enhancing
their effectiveness. Examine the institutional role
and composition of the Unit, how it accesses
technical skills, how it differentiates between
advocating and encouraging PPPs versus
monitoring, how it interacts with regulators, what
it can do to broaden and deepen the understanding
of PPPs across the public sector and how the PPP
unit integrates with the Ministry of Finance and
Economic Development and other line ministries;
Findings and Recommendations
The Report gives detailed analysis of how amendments
to the PPP Act 2004 and other legislative changes, such
as the Public Procurement Act and Regulations, have
combined to make the PPP legal and institutional
framework in Mauritius less efficient and effective than
that envisaged by the PPP Policy 2003 or the PPP Act as
first enacted. This regression has taken place while
other countries that are potential competitors of
Mauritius for PPP investment have been improving their
legal and institutional frameworks. The current roles,
responsibilities and relationships between different
parts of Government are not clear and the PPP Unit
lacks the status, authority and resources that are
needed to lead and manage the PPP process.
The PPP Act and much of the thinking within
Government on the PPP legal framework has been
focused on how PPP matters will be dealt with within
Government – matters that might well be capable of
improvement through administrative decisions,
guidelines and instructions. However, the PPP legal
framework is broader than the PPP Act itself, and it can
help or hinder PPP by addressing or failing to address
PPP issues from the perspective of PPP investors and
lenders. The Report sets out the weaknesses in the
existing PPP legal framework and recommends the
matters that should be addressed in a comprehensive
and competitive framework.
As stated above the PPP Unit lacks the official status,
authority and resources that are needed to lead and
manage the PPP process. Currently, it is an
administrative unit within the Ministry of Finance,
which awaits contact from line agencies on individual
projects. Line agencies have little or no incentive to
pursue PPP projects and the investment planning and
budget allocation process operates to ensure that only
the less attractive projects are left to be considered as
PPP projects after Government resources and donor
resources have been allocated to the more attractive
projects. The Report recommends how the status, role
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Terms of Reference
Identify mechanisms to improve the flow of
information between the PPP Unit and the line
ministries. Examine present outreach efforts and
indicate how successful they have been. Highlight
other mechanisms which have been used elsewhere
to disseminate information on PPPs. Specifically
look at conferences, course work, publications and
web based tools and make suggestions on which
medium might work best in the Mauritian context ;
Findings and Recommendations
and responsibilities of the PPP Unit and its relationships
with other parts of Government, including MOFEE, need
to change if the Government’s drive for PPP projects is
to succeed.
A key constraint to PPPs in Mauritius is the limited PPP
skills and experience among line agency staff as well as
within the MOFEE. Mauritius’ new PPP framework will
need to address this important gap through a
comprehensive strategy for training and capacitybuilding on PPP concepts, techniques, and skills. PPP
capacity-building is needed not only for the managers
and leaders of public sector bodies (ministries,
contracting authorities, and parastatals), but also for
representatives of Mauritius’ private sector and its nongovernmental organizations. The report recommends
that the PPP Unit should take the lead in coordinating a
program of PPP capacity-building initiatives.
Analysis of the present institutional relationships
between the PPP unit and other PPP stakeholders
The PPP unit is part of the Ministry of Finance and
Economic Development; it will not only have to
determine how it integrates within its own Ministry
but also with the other line Ministries. Some
thought will also be required on how the PPP unit
interrelates with the private sector, financial
sector and NGOs: an assessment of the current
institutional arrangement work, identification of
institutional issues if any, and how should they be
resolved, the effectiveness of the role of line
Ministries as facilitator in PPP projects;
Currently the PPP Unit does not have the status,
resources or authority within the public administration
and to be seen to have the power and influence to
implement Government decisions. As a result the PPP
Unit is not considered by the private sector to be a
major player on the part of Government in PPP matters.
While the PPP Unit is not a decision-making body,
(major PPP decisions are taken by Government and
intermediate decisions are taken by the PPP
Committee), it must have status and respect if it is to
function as an advisory body and as the interface
between the private sector and Government on PPP
matters generally.
Assist by deepening the analysis and understanding
of what characteristics should be considered in
evaluating potential PPP projects. Highlight the
important points to consider in terms of the legal
considerations;
The Report indicates matters that should be addressed
in the PPP legal framework to encourage effective PPP
projects. The clarity and certainty of PPP policy and the
PPP legal and institutional framework is desired not for
itself but because of the positive impact it has on
private sector interest in participating in PPP projects.
Assess the private market response to PPP in
Mauritius as currently designed, and identify any
gaps in the private market (technical capacity, risk
management, equity and debt) ability to provide
the investment needed, availability of debt on the
right terms and ability to deliver the services
required. Undertake a similar analysis of the legal
environment;
The new framework for PPPs will need active
participation from the local private sector in Mauritius
in order to be sustainable. In addition to bidding on
PPP tenders and providing equity and debt to local PPP
investments, local private firms should be invited to
work with the Government to structure the rules of the
game for the country’s new PPP framework. The report
recommends the establishment of a new PPP Forum
that would be required to meet twice per year to
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Terms of Reference
Support the creation a PPP unit Work Plan to look
at a variety of factors including: (1) legal and
regulatory reforms required to facilitate the flow
of PPP transactions; (2) institutional reforms to
assist with the development and management of
PPP transactions; (3) monitoring and regulatory
systems to oversee, track and generally oversee the
implementation of PPP programs; (4) a training and
capacity building program, as required. The Work
Plan should highlight actions which should be
considered in the short, medium and longer term.
Additional PPP framework plans, designs, and
recommendations requested by the Government of
Mauritius that were not included in the Terms of
Reference:
Findings and Recommendations
ensure regular communication on important PPP issues
between the public and private sectors.
Decide how best to address the weaknesses identified in
the review of the legal and institutional framework in
(a) actions to be taken in the next three months, (b) a
series of actions to be taken over a longer time horizon
– given that PPP is likely to be a permanent feature.
The matters to be addressed include the
recommendations on PPP unit, relationships with other
parts of Government, streamlining decision-making on
PPP matters e.g. appointment of advisers, composition
of PPP Committee, removing Central Procurement
Board from PPP process, recognizing that public
procurement and PPP procurement have substantial
differences, forming a PPP forum for stakeholders etc.
-
Recommended design and key content for a
strengthened PPP Policy Statement (See
Section 3.4)
-
Recommended design and key contents for a
strengthened PPP Act (See Appendix G)
-
Recommended terms of reference for a
Resident PPP Advisor for the PPP Unit (See
Appendix H)
-
Recommended terms of reference for a PPP
Framework Development and Capacity-Building
Advisor (See Appendix I)
-
Recommended terms of reference for a Chief
Executive for the PPP Unit (See Appendix K)
-
Recommended Action Plan and Design for a
Panel of PPP Experts (See Section 7)
-
Recommended terms of reference for a Shortterm Procurement & PPP Specialist to support
the PPP Unit’s launching of the Panel of PPP
Experts (See Appendix J)
-
Recommended PPP Project Identification &
Selection Management Matrix for the PPP Unit
(See Appendix L)
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
2. Introduction & Background:
Mauritius PPP Support Project
2.1 Background and Purpose of the Mauritius PPP
Support Project
The Public-Private Infrastructure Advisory Facility (PPIAF) approved a grant to
support the Government of Mauritius (the “Government”) in improving the
framework for Public-Private Partnerships (PPPs) and strengthening the PPP project
pipeline. This grant is managed and administered by the World Bank’s Mission in
Port Louis.
This report contains a review, analysis and recommendations for strengthening the
policy, legal, and institutional framework for PPPs in Mauritius as required by the
terms of reference for the assignment. These recommendations are designed to
overcome the specific constraints identified and analyzed and to expand PPP
opportunities to promote economic and social infrastructure development.
The Government desires to strengthen its PPP legal and institutional framework.
The foundations for the success of that move are laid out in this report and should
be built upon through discussion with PPP stakeholders to ensure a common
understanding of priorities, needs and concerns. The Government, the World Bank,
and the consulting team, agreed that the focus of this assignment should be the
analysis of the PPP legal and institutional framework in Mauritius with specific
recommendations for improvement set out in a practical action plan. The
Government of Mauritius may then decide which of these recommended actions it
will accept and subsequently implement.
2.2 The Mauritius PPP Context: Past PPP
Framework and Pilot Initiatives
During the past fifteen years Mauritius has been seeking to implement a number of
PPP-type projects as well as to establish a policy, legal, and institutional framework
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
for PPP. During that time pilot PPP projects have been promoted in a number of
sectors including independent power projects, a private flour mill at Port Louis, a
PPP for the water and wastewater sectors, and others. Additionally, past efforts at
establishing a PPP legal and institutional framework in Mauritius have included:


The Concession Projects Act (CPA) 1997 (repealed 2001 and replaced by the PPP
Act 2004)
The Procedures Manual for Concession Projects produced by the Concession
Project Division of the then Ministry of Finance, 1998-1999.
Mauritius is currently preparing to invite proposals for a portfolio of 6 PPP projects:
 The Highlands modern town project of the State Land Dev. Co.
 The Rose Hill Integrated Mixed-Use Facility
 The Port Louis Ring Road & Harbour Bridge Tolling System
 The Bigara Curepipe 25-40 MW Windpark Project
 The Mahebourg Waterfront Development Project (Phase 2)
 The Curepipe Integrated Mixed-Use Facility Project
The existing PPP framework is composed of a number of different statements, Acts,
institutions, and instructions that have emerged during the past 7 – 8 years:
Policy Framework

PPP Policy Statement from the Ministry of Economic Development,
Financial Services and Corporate Affairs May 2003
Legal Framework



PPP Act 2004 (as amended)
Public Procurement Act 2006 (as amended)
Public Procurement Regulations 2008
Institutional Framework:


PPP Unit at the Ministry of Finance and Economic Empowerment set up
2001
PPP Committee replaced Financial Secretary role in PPP process 2008
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework





Central Procurement Board
Contracting Authorities
Project Plan Committee (PPC)
Public Sector Investment Programme (PSIP) Unit
The Board of Investment (Investment Promotion Act)
Guidelines:
PPP Guidance Manual 2006
2.3 The Objectives of this Consultancy
The scope of work for this consultancy set out two main deliverables:
1. Analysis & Review of PPP Legal & Institutional Framework: An assessment of the
current framework of PPP policies, laws & regulations, institutions, and procedures and
specific recommendations for how the PPP framework should be improved in the form
of a work plan. This report provides:



A description and analysis of the key PPP framework issues
When relevant, potential options for addressing each issue are identified,
described, and analysed.
A recommended action plan for each framework element presented in a
common format as requested by the Government:
o Recommended Actions: Title of the Recommended Activity
o Specific Description: Detailed description of specific action
comprising the recommended activity
o Required Resources: A description of the estimated resources
required to complete the activity in terms of time and of money.
This will address the resources required from existing public
institutions (for example the time required from the staff of the PPP
Unit) as well as new, additional resources that will need to be
created, such as from outside PPP specialists or consultants.
o Monitoring of Actions: Explanation of how and by whom the key
steps of the activity will be monitored to demonstrate successful
completion
At the request of the MOFEE, each recommended activity includes a review utilizing
the S.M.A.R.T. methodology. These template-based reviews help ensure that each
recommended activity is specific, measurable, achievable, relevant, and time-bound.
o S.M.A.R.T. Analysis of Recommended Activity:
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Recommended Activity
Specificity:
How is it Specific?
Measurable:
How will it be Measured?
Achievable:
Is the task achievable, and what does Achievement look like?
Relevance:
Why is it Relevant to the overall PPP program/strategy/goals?
Timeliness:
By when will it likely be achieved?
2. Identification and Preparation of Potential PPP Projects: Identify, in consultation with
the Government, a “long-list” of potential PPP projects and to select and prepare PPP
assessments for 10 PPP candidate projects. These assessments are not PPP feasibility
studies. They are reviews of the available information on each project, which assess
whether a project would make a suitable candidate for further preparation and
implementation through a PPP arrangement. Importantly, these assessments provide
recommend actions for undertaking the next steps for the detailed analysis, riskstructuring, review, and possible tendering of each PPP candidate project.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
3. Assessment and
Recommendations for PPP Policy
in Mauritius
Summary of Assessment & Recommendations for Mauritius’
PPP Policy:





Significant confusion exists within Government and the local private sector about the goals, the
roles, and the overall process for PPPs. This is constraining the implementation of current PPP
projects in Mauritius.
The PPP Policy Statement 2003 is now irrelevant, having been overtaken by several subsequent
amendments to the PPP Act of 2004
A revised PPP Policy include would provide the foundation for more effective understanding of PPP
definition, rationale, goals, and strategic roles as well as the important foundation for the legal,
institutional procedures needed to facilitate PPP project implementation in Mauritius.
A recommended outline and contents for an updated, revised, and more effective PPP Policy
Statement is provided
The most effective means of achieving these needed results is through the drafting a new PPP
Policy Statement by the PPP Unit, discussion and adoption by Cabinet, and broad training and
capacity-building by the PPP Unit. This result could not be realized simply through ministerial
decree or inclusion in a budget speech.
3.1 Assessment of Mauritius’ PPP Policy
Framework:
The PPP Policy Statement 2003
While the Government of Mauritius does not usually issue policy statements prior to
introducing new legislation, in 2003 the Ministry of Economic Development,
Financial Services and Corporate Affairs issued a PPP Policy Statement, prior to
introducing legislation that became the PPP Act 2004. This 2003 Policy Statement has
since been surpassed by events, including changes in the composition of
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Government and amendments to the PPP Act. It remains the only published Policy
Statement on PPPs that has been issued by a Ministry of Government.
This PPP Policy Statement sets out a commitment by the Government to utilize PPP
as a method for the procurement of key public services. Priority sectors identified
for improvement through PPP arrangements include transportation, public utilities
(including energy and water), solid and liquid waste management, health care,
education and vocational training, and information and communications technology
(ICT).
Outline of Contents of PPP Policy Statement 20031:
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
Introduction
Wider Policy Context for PPP (Utilizing PPPs to Support the Economic Agenda for the New
Millennium)
The PPP Concept (The Definition of a PPP)
Reasons for Using PPP (fostering economic growth, new commercial opportunities, expanded
investments by private sector, more efficient service delivery, improved customer-focus,
and accelerated delivery of projects)
Scope of PPP (Focus on transportation, public utilities, solid and liquid waste management,
health, education and vocational training, information & communications technology (ICT)
Key Considerations of PPP Policy
6.1
Need for Affordability,
6.2
Need for a Supportive PPP Legislative Environment,
6.3
Need for a Supportive PPP Institutional Arrangements,
6.4
Need for PPP Capacity Building
Unsolicited PPP Bids
Conclusion
The PPP Policy Statement 2003 requires that any PPP project must be shown to be
affordable to Government and the public (either as the end-users and consumers of
specific public services or as general taxpayers). In fact, affordability is stated as the
main criterion for deciding if a PPP project would be approved by the Government
for implementation or not. PPP was further seen in Mauritius to be a part of a
broader policy context of public expenditure reform in Mauritius, to be integrated
with the then-proposed Medium-Term Expenditure Framework (MTEF). This PPP
Policy set out the need for a new, coherent legal and institutional framework and for
capacity-building in PPP, as the success of the PPP programme would clearly
36
Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
depend on the development and retention of appropriate new skills and expertise
within the public sector. The key institutions called-for under the PPP policy
including a new PPP Unit (initially located in the Ministry of Economic
Development, Financial Services and Corporate Affairs but almost immediately
transferred to the now-named Ministry of Finance and Economic Empowerment
(MOFEE), line ministries and contracting authorities, and the Central Tender Board
(now the Central Procurement Board).
The Role of the PPP Unit and of Public Contracting Authorities:
The 2003 PPP Policy Statement saw the role of the PPP Unit as being the key driver
and promoter of PPP projects and of the key steps in the PPP project life-cycle. In
implementing PPP projects, the PPP Unit was identified to ensure effective
stakeholder engagement, to assess market interest, and to provide the institutional
momentum for advancing the development of PPP transactions. In fulfilling this
role, the PPP Unit was to provide support to line ministries, and contracting
authorities to ensure that PPP projects were sufficiently appraised, scoped, and
planned prior to initiating any PPP procurement process. PPP Transaction advisers
were to be recruited when required to assist in this process and the PPP Unit was to
develop guidelines on best practices to assist sector Ministries in the roll-out of PPP
projects.
Under this PPP Policy, contracting authorities (which include line Ministries and
other public bodies) were to be supported by the PPP Unit in the identification,
selection and monitoring of PPP projects. With the oversight of the PPP Unit and the
help of PPP transaction advisors, contracting authorities were to move forward with
implementing PPP projects.
MOFEE was seen as playing a key role in assessing the budgetary implications of
PPP projects. The PPP Unit (initially proposed to be in a different Ministry) was to
work closely with MOFEE in the assessment of PPP project affordability, value-formoney, feasibility, and contingent liabilities associated with PPP projects. As will be
seen later in this report, the PPP Act 2004 reflected the content of the PPP Policy
Statement but a series of amendments since then have meant that there are now
significant differences between the PPP Policy Statement, which has not been
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
updated, and the current amended PPP Act. Analysis of the PPP Act in this report
shows that there is a need to revise the legislation, and, as a prior requirement, to
restate the PPP Policy to guide that revision.
3.2 Gaps within Mauritius’ PPP Policy Framework:
In spite of best efforts, the level and pace of PPP project implementation and
completion in Mauritius has been less than expected and below what is required to
fulfill the need in Mauritius for improved, expanded, and more competitive
infrastructure. There is still a need to address fundamental policy issues in
understanding as to:




What PPP is,
How quickly PPP projects can be delivered,
Why PPP can play a beneficial role, and
What changes are required to the implementing machinery and measures to
enable PPP to provide improved infrastructure facilities and services.
Defining what a Public-Private Partnership (PPP) is:
Between the PPP Unit and line ministries, contracting authorities, and leaders from
the private sector, there are different views in Mauritius as to what falls within the
meaning of a PPP arrangement. One view within the MOFEE has proposed that PPP
arrangements should be confined to concessions where end-user charges are the
source of project revenue. Other views expressed have seen PPP arrangements as
extending beyond projects funded by user charges to include projects where
payments may be made by a public contracting authority or by a combination of
user charges and public contracting authority payments.
The concept of confining PPP arrangements to concessions is based on an
assumption that the cost to Government of borrowing funds is lower than for the
private sector automatically resulting in the cost of traditional public procurement
being lower than PPP procurement. This reasoning does not reflect a major source of
better value for money in a PPP arrangement. Through transfer of risk in a PPP
arrangement the private sector is encouraged to deliver a facility or service more
38
Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
efficiently than traditional public procurement. Better value for money is primarily
obtained through this means and is by no means determined solely by the cost of
capital.
International good practices show that the revenue stream for operating successful
PPP projects can flow from a variety of sources – user-fees, payments by the public
sector or a combination of these sources. Decisions on the most appropriate means
of funding capital and operating costs of PPP projects are best taken on a case-bycase basis from PPP feasibility study evidence. Assessment of affordability and
value for money of a PPP project compared with traditional public procurement
cannot be pre-determined simply on the basis of the source of funding or cost of
borrowing to Government compared with the private sector.
Specific Gaps in the PPP Policy Framework in Mauritius:
1. The current PPP policy framework in Mauritius has not produced significant meaningful results in
terms of PPP activity in the thirteen years since the Concessions Project Act 1997 or the seven years
since the PPP Policy Statement 2003.
2. In spite of the policy consultation process, the PPP Policy Statement has not succeed in providing a
common, clear understanding of institutional roles, responsibilities and relationships for different
parts of Government and the private sector throughout the entire PPP project cycle and did not
address many other issues that are essential to a streamlined PPP process, promotion of
competition among potential partners and implementation of successful transactions.
3. The PPP Act 2004, as enacted, was substantially different from the contents of the PPP Policy
Statement, making the policy-making and policy consultation processes largely redundant.
4. The PPP Act 2004 has been amended substantially since proclamation in 2005 indicating that the
policy formation process or the law making process was inadequate.
5. The contents of the 2003 Policy Statement are:
(a). Not accurate and inconsistent with the current legal and institutional framework. (See
Appendix A where the example of differences in the definition of PPP in the PPP Policy
Statement and the PPP Act and the changed roles of entities such as PPP Unit and
relationships on PPP matters between various parts of Government are highlighted),
(b). Not complete in the range of issues addressed. (See Appendix C for a comparison of the list
of topics typically found in a comprehensive PPP policy statement with the contents of the
Mauritius PPP Policy Statement),
(c). No longer compatible with a streamlined PPP project cycle process in which institutional
roles are distinguished, relationships are specified unambiguously and the extent and limits
of authority are clearly delineated to provide essential checks and balances for
transparency and accountability, (See Appendix 3 which describes the changing institutional
framework between the PPP Policy Statement and the various frameworks that have been
created, altered and modified through the PPP Act, amendments to that Act and by other
legislation).
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Uncertainty about Roles & Slowness of the PPP Implementation
Process:
Within the private sector there are Mauritian firms currently willing to invest in
PPPs, but who reported unwillingness to do so, because they view that the PPP
framework and process moves too slowly and that the public sector lacks
understanding of critical issues. Private sector investors and lenders reported that
they are unwilling to get involved in prototype or pilot PPP projects during which
the public sector goes through a PPP learning process. However, several private
sector developers and lenders indicated that they would come forward with
confidence when it is clear that the public sector understands the issues and is
committed to PPP for its merits in delivering value for money through project
delivery. Any thinking that sees PPP as providing a free or low cost source of
finance for projects or a means of circumventing public expenditure constraints
should be dispelled.
While these fundamental, policy issues need to be addressed, there are optimistic
grounds that PPP arrangements can play a significant role in economic development
in Mauritius. Mauritius’ investment climate has been evaluated as being one of the
most attractive and competitive throughout the region.2 Moreover, the local private
sector has shown that it can mobilize long-term local investments, such as in the
independent power, real estate development, and tourism sectors. The legal and
judicial system and financial services are credible. There is political stability and
there is no opposition in principle to procuring projects by way of PPP arrangement.
The recommendations in the report build on these positive grounds to ensure that
PPP arrangements supplement public sector investment and successfully deliver
infrastructure facilities and services.
2
According to the latest Doing Business Report 2009 of the IFC and the World Bank, Mauritius is ranked as the
17th most attractive business climate in terms of Ease of doing business (out of a total of 183 countries).
Moreover, Mauritius’ ease of doing business ranking has been improving during the past 3-5 years. See:
http://www.doingbusiness.org/economyrankings/
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
3.3 The Need to Strengthen Mauritius’ PPP Policy
Foundation:
Given the specific changes in the legal and institutional frameworks and identified
weaknesses in the existing legal and institutional framework there is a clear need to
remove the current confusion and uncertainty on PPP policy matters reported
during meetings with a range of leading public sector and private sector bodies in
Mauritius. This confusion and uncertainty is to be found in different parts of
Government, and among representatives of the private sector and the general public
regarding basic matters such as what is PPP, what are the aims of PPP, by what
means can PPP projects be brought about, what are the roles, responsibilities and
relationships of different parts of Government throughout the PPP project cycle and
how complex transaction and project issues will be addressed in the interests of the
public sector, private sector investors, operators and lenders and the general public.
Restating Mauritius’ PPP policy will help accelerate the implementation of a
coherent set of actions to improve infrastructure facilities and services through
successful PPP projects. This restatement will also bring a common understanding of
PPP goals and help promote public sector and private sector capacity to identify and
realise potential PPP projects. Restating policy will also provide a sound basis for
addressing specific problems in Mauritius’ PPP legislation as set out later in the
report.
An Improved PPP Policy Provides the Necessary Foundation for More
Effective PPP Legislation, Institutional Procedures, and Transactions:
The overall framework for implementing PPPs in Mauritius requires a cumulative
structure of policy, law, institutions, and PPP projects. As depicted in the Figure
below, for PPP transactions to be implemented and sustained, there must first be a
clear foundation of both a PPP Policy as well as a PPP Law.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Figure 2. The Role of PPP Policy within an effective and sustainable PPP framework
Without the clear foundation provided by a PPP policy, uncertainties about the definition of
PPP, the reasons for pursuing them, the roles and responsibilities of each institution make
the process of trying to complete PPP transactions uncertain, prone to disagreements, and
well as subject to delays.
As will be assessed in the next chapter of this report, there is also an important need
to improve Mauritius’ PPP Act. The process of drafting PPP legislation is critical to
determining its effectiveness and to promoting the much-needed acceptance and
understanding of it in Mauritius. PPP legislation must be seen as practicable by the
officials and public sector bodies affected by it and with responsibility for
implementation. A full understanding of both the spirit and intent of what the
Government seeks to achieve through PPP legislation is essential not only for
legislators, but also for key public sector bodies (including the PPP Unit, the
MOFEE, the Procurement Policy Office, line ministries, contracting authorities,
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
parastatals) and by the private sector. Without an updating and revision of
Mauritius’ PPP Policy, it will not possible to implement all of the recommended
revisions to Mauritius’ PPP Act.
3.4 Recommended Action: Update and Adopt a
Revised, Strengthened PPP Policy Statement:
Based upon the gaps and constraints contained within the existing PPP policy
framework, and the constraints this causes to the PPP laws, institutions, and
transactions – it is recommended the Government of Mauritius approve the
preparation of an updated and revised PPP Policy Statement. The following
provides the recommended outline and contents of this updated PPP Policy
Statement.
The Recommended Contents of and Outline for the Revised PPP Policy
Statement:
1. PPP Arrangements – definition
2. Scope of application - specify who may enter PPP arrangements and what sectors and
activities may be the subject of PPP arrangements
3. Goals of PPP policy
4. PPP and competitiveness
5. Risk sharing, affordability and value for money
6. Fiscal Risk, Guarantees and Contingent Liabilities
7. PPP Institutional Framework I: Establishment, functions, powers, staffing, reporting and
accountability of “PPP Unit”, “PPP Steering Committee”, “PPP Stakeholders Forum”
8. PPP Institutional Framework II: Roles, responsibilities and relationships: “PPP Unit”,
“PPP Steering Committee”, MOFEE, Line Ministries and other Contracting Authorities,
Regulatory bodies, Public Procurement
9. PPP Capabilities, Techniques and Tools
10. PPP and Public Expenditure
11. PPP Programme and Pipeline and Investment Planning
12. PPP and Regulation
13. Stakeholder consultation and participation
14. PPP Project Cycle – preparation, PPP feasibility, procurement, contracts, financing,
construction, operation
15. PPP approvals and decisions
16. Unsolicited PPP proposals
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
Project development funding
Disclosure and Reporting
Accounting for PPP
Auditing and Review of PPP for Value for Money Performance
Monitoring and evaluation of PPP projects and PPP programme
Contract Management, Adjustment and Renegotiation
Dispute Resolution
Legislation (Act and regulations), Procedures, Guidelines and Instructions
Standardised PPP Agreements
PPP Manual
Lessons Learned from Other Examples of PPP Policy Statements:
A 2007 review by the World Bank’s InfoDev of the key characteristics of effective PPP policy statements
assessed the PPP frameworks of the United Kingdom, South Africa, Australia, the Philippines, Ireland, the
European Union, India, Indonesia, Malaysia, Saudi Arabia, and Egypt.
Internationally, the key
characteristics of effective PPP Policy Statements include the following:
 Brief, accessible & easy to understand, especially for readers without a background in PPPs
 Clear, country-specific explanations for the goal & objectives of the PPP Policy
 Clear definitions for “Public-Private Partnership” and for other key PPP-related terms and
concepts, including “Value for Money,” “Affordability,” “Public Sector Supports,” and other PPPrelated terms
 Focus on practical solutions to help PPP transactions get completed, while generally seeking to
minimize any new administrative, reporting, or review burdens that would delay or stop proposed
PPPs
 Allow for practical PPP lessons to be learned and for periodic improvements to made to the PPP
policy framework
 Avoid being overly-detailed, prescriptive, and inflexible, and encourage private sector innovation
These important characteristics have informed the recommended organization and key contents of a new
PPP Policy for Mauritius.
3.5 Justification & Estimated Benefits of
Implementing the Recommendation:
The decision to update and revise the PPP Policy Statement is an important one that
not only offers opportunities to strengthen Mauritius’ entire PPP framework, it also
risks subjecting the PPP strategy to lengthy policy debates, which could delay both
44
Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
the PPP framework completion as well as individual PPP projects. Important
benefits from updating and strengthening the PPP Policy Statement include:




A strengthened PPP Policy Statement would eliminate the current level of
confusion and misunderstandings that existing between Government bodies
(including the PPP Unit, the PPO, the PPP Committee, MOFEE, PPC, Line
Ministries, and Contracting Authorities) about the definition of PPP, which is
currently blocking progress on PPP projects such as the Bigara Wind farm
project.3
A strengthened PPP Policy Statement will provide a clear basis for
development of a clearer PPP Law (see Chapter 4 on PPP Law for specific
recommendations & justifications)
An updated and strengthened PPP Policy Statement will provide a common
understanding between both Govt. and the private sector in Mauritius on the
purpose of PPPs, the principles for their preparation and implementation.
Currently private sector leaders in Mauritius’ financial institutions, property
development, industrial, and sugar industries have reported they lack
confidence in the Government’s framework for PPPs and are unwilling to
propose new PPPs, and doubtful that current PPPs such as the Port Louis
Road Decongestion Project will work. Such a clearer statement would
provide the foundation for addressing these important long-term constraint
to PPPs in Mauritius.
A strengthened PPP Policy Statement would provide a common
understanding between both Govt. and the private sector in Mauritius on the
purpose of PPPs, the principles for their preparation and implementation.
Currently private sector leaders in Mauritius’ financial institutions, property
development, industrial, and sugar industries have reported they lack
confidence in the Government’s framework for PPPs and are unwilling to
propose new PPPs, and have limited confidence that PPP projects under
consideration such as the Port Louis Road Decongestion Project can succeed.
3
An independent power project, such as the proposed wind farm project, which would receive payment from
CEB under a power purchase agreement does not fit within the PPP Act definition of PPP.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
3.6 Options for Implementation: Can the same
Results be Achieved without Implementing a New
PPP Policy Statement?
The question has been asked within the Government of Mauritius whether the
development and adoption a new PPP Policy Statement is the only means of
achieving these objectives; or can the same results be achieved through simpler
administrative processes? Such administrative processes could include issuing a
Ministerial decree from the MOFEE, or including these PPP policy changes in the
Government’s next budget speech.
The following summarizes the issues facing the ease of implementation as well as
the expected levels of improvement from these two identified options:
1. Seek to revise the PPP Policy through administrative mechanisms
2. Seek an new, official, revised and updated PPP Policy Statement
Options
Issue
Administrative
Changes to
Existing PPP
Policy
Development,
Discussion &
Adoption of
Official New
PPP Policy
Ease of Implementation






Easier to Implement
Can be done through
MOFEE Ministerial decree
or inclusion in Budget
speech
Could be completed by
end of 2010
More difficult to
complete
Requires review and
approval by Cabinet
May require until 2011 to
complete
Level of Improvement Achieved
Moderate improvements, including:


Could remove some of the current
inconsistencies with amended PPP
Act
Would not achieve common
understanding among Govt. &
private stakeholders about PPP
definition, goals, and strategic
roles
Significant improvements:

Systematically eliminate all
current misunderstandings about
PPP definitions, eligibility, roles,
& processes through a moreeffective consultative process
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Options
Ease of Implementation
Level of Improvement Achieved


Provide clear basis for
strengthening the PPP Law and
realizing its expected benefits as
well.
Raise private sector confidence in
Govt’s commitment to PPPs and
help raise interest in specific PPP
investment opportunities
It should be noted that these two approaches are not mutually exclusive. It is
possible for the Government to pursue the option of making specific changes to the
existing PPP Policy according to the recommendations in the short-term through
ministerial administrative mechanism, while pursuing a longer-term strategy
developing a more comprehensive revision of the PPP Policy. While the Consultant
Team recommends that the best way for Mauritius realize the greatest potential
benefits of a more effective PPP framework will be through a new, rather than an
amended PPP Policy, it will be possible for the Government to still realize important
improvements in its PPP programme by implementing these changes through the
simpler administrative process, such as the issuances of a ministerial decree.
The Goal: Broad, Common Understanding of PPP Policy & Not Just a
New Policy Document:
The outcome of this recommendation is not simply the publication of a PPP policy
document. Rather, the contents of the PPP Policy need to be well-understood by a
range of key stakeholders both within Government as well as within the private
sector. Without a clear and common understanding of the definition, the rationale,
the goals & objectives, as well as the strategic roles of each of the key institutions for
implementing PPPs, Mauritius can expect more the some obstacles, issues, and
delays to constrain its PPP projects.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
3.7 Recommended Plan of Action:
Specific Actions:
1. The PPP Committee and the MOFEE Finance Secretary approve the amendment of the
PPP Policy Statement. The PPP Unit should be tasked with carrying-out this task,
coordinated by its new PPP Framework Development & Capacity Building Manager.
(The position is described in Chapter 5 below and a full-copy of the terms of reference
for this position is included in Appendix I below)
2. The Unit’s PPP Framework Manager would benefit from the focused support of a PPP
Policy Specialist to complete this activity.
3. The Draft policy is reviewed by the PPP Committee and the Finance Secretary, as
necessary
4. The PPP Unit should conduct a series of training and capacity-building workshops on
understanding the new PPP Policy for both leading public sector institutions (MOFEE,
PPC, PPO, State Law Office, line ministries, contracting authorities, and parastatals) as
well as the local private sector (investors and commercial lenders) and relevant
multilateral & donor organizations (World Bank, IFC, AfDB, etc.). Initially, two
workshops should be conducted for when the new PPP Policy is adopted. Thereafter,
one workshop should be conducted annually to maintain a common understanding of
the PPP Policy and its provisions.
5. Annual evaluation review of the PPP Policy is conducted by the PPP Unit, to determine
if it should be modified and improved.
The policy drafting, adoption, and capacity-building tasks of the PPP Policy plan
should be implemented together with the preparation of the revised PPP legislation
(described and recommended in Chapter 4 below). In effect, the PPP policy will be
equivalent to the instructions that would be given to a parliamentary draftsman
when drafting the actual legislation and implementing rules, rather than
undertaking the Policy and PPP legislation as two separate exercises.
Monitoring of Actions: The PPP Unit’s progress and completion of this activity will
be monitored by PPP Committee under existing arrangements and by MOFEE
Finance Secretary. The PPP Unit will monitor the consultants it has engaged to
support restatement of the PPP Policy.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Required Resources:
1. Directing of existing resources at PPP Unit, the PPP Committee, the MOFEE’s Finance
Secretary, the Cabinet, and other stakeholders to the above tasks.
2. As contained in Section 5.1 below (Design and Organization of the PPP Unit), it is
recommended that the PPP Unit hire a full-time PPP Framework Development &
Capacity-Building Manager. A full copy of the Terms of Reference for recruiting and hiring
the individual is included in Appendix I of this Report. This specialist will provide most of
the human resources to coordinate and complete this activity.
6. The PPP Unit and its PPP Framework Development & Capacity-Building Manager will
also need local or international consultants to support restatement of policy. Because this
Activity is so closely linked with recommended revision the PPP Law, it is
recommended that the same PPP Policy and Legal Specialist be retained to support both
of these activities. The estimated level of effort of these consultants to complete this one
activity is:
o PPP Policy and Legal Specialist = 25 days
Analytical Review of Recommended Activity: S.M.A.R.T Analysis
Template
Recommendation: Design, Draft & Adopt a Strengthened PPP Policy Statement
Specificity: How is it Specific?
This PPP Policy Statement will be an individual document, reviewed
and approved by Government, with input from the private sector,
that clearly articulate the definition, the objectives, and principles
behind Mauritius’ PPP strategy
Measurable: How will it be
Measured?
Successful completion of this activity can be clearly measured by
whether or not the new PPP Policy is both drafted by the PPP Unit
and if it is adopted by the Cabinet
Achievable: Is the task
achievable, and what does
Achievement look like?
While completion of the drafting of the PPP Policy Statement is not
difficult for the PPP Unit to achieve, the decision by the Cabinet to
approve the new PPP Policy Statement could be subject to the risks
of delays.
Relevance: Why is it Relevant
to the overall
program/strategy/goals?
The new PPP policy provides the foundation upon which the legal
requirements, the procedures, as well as the functions, powers, and
duties of the PPP Unit all rest. Without this foundation the ability of
the PPP program in Mauritius will remain constrained.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Recommendation: Design, Draft & Adopt a Strengthened PPP Policy Statement
Timeliness: By when will be
achieved?
The drafting of the new PPP Policy Statement can be completed
within 3 months after the decision to authorize it. The approval of
the PPP Policy Statement by Cabinet may take longer than 4-6
months depending the political priorities at the time.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Timing of Activity:
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
4. Assessment &
Recommendations for PPP Legal
Framework
Summary of Assessments & Recommendations for
Mauritius’ PPP Legal Framework:





The overall legal framework for PPPs in Mauritius (including PPP Act, implementing Regulations,
the Public Procurement Act 2006 (amended), and the Public Finance Act, etc.) is disjointed,
incomplete, repetitive in parts and yet not comprehensive.
The specific constraints within this legal framework are both delaying the implementation of
current PPP projects in Mauritius as well as limiting to the ability to implement PPPs in the
future.
The two main options for implementing these changes to the PPP legal framework are: Design,
Draft, Discuss and Pass a New PPP Act, or Issue ministerial amendments to the current PPP Act
through administrative procedures.
Although it would be more challenging and time-consuming to complete, the drafting and
passage of a new PPP Act is recommended as the best option for addressing both the immediate
legal constraints to current PPP projects, as well as for addressing the longer-term obstacles to
Mauritius PPP framework
A recommended design and list of the specific key contents for a new PPP Act has been provided
in Appendix G
4.1 Understanding the Scope of Mauritius’ Legal
Framework for PPPs:
The current legal framework for Public-Private Partnerships in Mauritius is broader
than just the PPP Act. It includes the entire interface with legislation on:

Public financial management,
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework





Public procurement,
Regulations and procedures for operating the PPP project cycle including PPP
procurement,
Relationships between different Government authorities relevant to PPP,
PPP contracts and agreements, and
Contract monitoring and auditing.
Since the current PPP Policy was issued in 2003 and the PPP Act 2004 was
promulgated in 2005, additional legislation has been enacted on public procurement,
public debt management and other subjects and there are changes in practices that
are relevant to PPP. The PPP Act 2004 was amended in 2008 to provide for the
establishment and functions of the PPP Committee and to provide for unsolicited
proposals. The Public Procurement Act 2006 and the Public Procurement
Regulations 2008 have come into force and both the Act and the Regulations were
subject to amendments in 2008 and 2009. The Public Debt Management Act 2008 has
been enacted, while the Finance and Audit (Amendment) Act 2008 amends the
Finance and Audit Act in matters relating to capital projects and expenditure changes which are relevant to the planning and implementation of projects through
either traditional or PPP procurement. The Ministry of Finance and Economic
Empowerment has finalised the Investment Projects Process Manual (IPPM)
relevant to all capital projects, regardless of method of procurement.
The following analysis traces the evolution of PPP legislation and institutions in the
past 5 - 6 years. A detailed analysis of the PPP Legal Framework has been carried
out (see Appendix E below) which identifies each specific constraint that should be
addressed within each component of the legal framework. This also provides
specific recommendations to overcome each identified weaknesses set out in tabular,
matrix form.
4.2 The Key Components of the Current PPP Legal
Framework:
PPP Act 2004 (promulgated 1 March 2005)
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
The PPP Act was enacted to provide for the implementation of public-private
partnership agreements between contracting authorities and private parties and to
establish a set of rules governing public-private procurement. This Act legally
established the PPP Unit as an office within the Ministry responsible for finance
with the initial role of dealing with all matters relating to a PPP project.
PPP Act 2004 (as promulgated in 2005) and Role of the PPP Unit:
The statutory functions of the PPP Unit set out in the PPP Act 2003 (as first enacted)
are to make an assessment of a candidate PPP project submitted to it by a
contracting authority and to give its recommendations to the Financial Secretary, as
to whether the project:
(i)
(ii)
(iii)
Is affordable to the Contracting Authority;
Provides value for money; and
Presents optimum transfer of technical, operational and financial risks
to the private party.
According to the law, the PPP Unit is to examine the request for proposal to ensure
conformity with the approved feasibility study, advise Government on
administrative procedures in relation to PPP projects, develop best practice
guidelines in relation to all aspects of PPP, formulate policy in relation to PPP
projects and develop PPP awareness in the country. The PPP Unit is currently
staffed by just two officers with background in economics, accountancy, and finance.
PPP Act 2004 (as promulgated in 2005) and the Role of Contracting
Authorities:
Although the PPP Act 2004 was amended in 2008, these following paragraphs
describe the position prior to those amendments to provide insights into the nature
of the pattern of amendments to the PPP Act.
The PPP Act defines a Contracting Authority as any Ministry or Government
department, local authority or statutory corporation. The Contracting Authority
shall identify, appraise, develop and monitor a project to be implemented under the
Act, undertake or cause to be undertaken a feasibility study where it considers that a
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
project may be implemented under an agreement, submit the feasibility study to the
PPP unit for its approval, prepare a request for proposal on the approval of the
feasibility study and, where the terms of the proposed agreement impact on public
finance, seek the approval of the Financial Secretary. The PPP Act provides that a
project for which there is no financial or contingent liability for Government shall be
exempt from the approval of the Financial Secretary – although in practice it is
difficult to think of a PPP project where there would be no financial or contingent
liability for Government.
Where the Financial Secretary approves the terms of the agreement, the Contracting
Authority shall submit a request for proposal to the Central Tender Board (now the
Central Procurement Board) to obtain its written authorization to advertise, invite,
solicit or call for bids. The Contracting Authority shall consult the Central Tender
Board to obtain its written authorisation to conduct what is described as a “preselection” exercise after public invitation (i.e. create a short list of persons who
would be invited to submit proposals). The “pre-selection” document shall be
subject to the written approval of the Central Tender Board before its issue and
publication. The Central Tender Board may carry out a “pre-selection” exercise to
select potential bidders or may delegate this power to the Contracting Authority
where it considers that the Contracting Authority has the necessary expertise. The
Contracting Authority then prepares a Request for Proposal (RFP) and submits it to
the Central Tender Board for its written approval.
The Central Tender Board is responsible for ensuring transparency and equity in the
bidding procedures, examines and evaluates the bids received, makes
recommendations to the Contracting Authority for entering into negotiations with
the preferred bidder, and may approve the award of the project. The Central Tender
Board may commission any study relevant to the determination of the award of a
project, request any professional or technical assistance from any appropriate body
or person in Mauritius or elsewhere, in relation to the examination and evaluation of
bids. The Central Tender Board may refer the bids to the appropriate Contracting
Authority for examination and evaluation, provided that the Central Tender Board
is satisfied that the Contracting Authority has the necessary expertise. If the Central
Tender Board refers bids to the Contracting Authority for examination and
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
evaluation, then the Contracting Authority shall submit its findings to the Central
Tender Board.
Where the Central Tender Board makes a recommendation that involves a change in
the terms of the proposed PPP agreement compared with the agreement approved
earlier in the process by the Financial Secretary, then the Contracting Authority
submits the proposed agreement to the Financial Secretary for approval of the
change. Where the Financial Secretary approves the change, the Contracting
Authority shall seek the final approval of the Central Tender Board for the award of
the project.
The functions of the Central Procurement Board, which is the successor body to the
Central Tender Board, have been amended in the Public Procurement Act 2006 and a
Procurement Policy Office has been established. The PPP Act provides that a
Contracting Authority shall not award a project or sign an agreement unless:
a.
b.
The award of the project has been approved by the Central
Tender Board; and
The agreement relating to the project has been approved by
Cabinet.
2008 Amendments to PPP Act 2004:
In 2008 the PPP Act was amended. Section 3 of the PPP Act 2004 (promulgated in
2005) which provided for the establishment and functions of the PPP Unit, was
deleted and replaced by provisions for the establishment and functions of the PPP
Unit and a PPP Committee as well as the process for handling unsolicited proposals.
The amended PPP Act provides for the PPP Unit as a unit within the Ministry
responsible for finance, which shall deal with matters relating to a PPP project
referred to it by a PPP Committee. It states that there shall be a PPP Committee,
which shall deal with all matters relating to a PPP project. The PPP Committee
consists of the Director, Procurement Policy Office [this is not the Central Tender
Board or Central Procurement Board see below Public Procurement Act 2006], who
shall be the Chairperson, a representative of the Ministry of Finance, a
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
representative of the Ministry responsible for public infrastructure, and a
representative of the Attorney-General’s Office and the PPP Committee may co-opt
such other persons as may be of assistance in relation to any matter before the
Committee.
The functions of the PPP Committee include those that were previously functions of
the PPP unit namely, to make an assessment of a project submitted to it and gives its
recommendations to the relevant contracting authority, develop best practice
guidelines in relation to all aspects of public-private partnership, formulate policy in
relation to public-private partnership projects, develop public-private partnership
awareness in the country. The Act has been further amended to substitute the PPP
Committee for the Financial Secretary in those provisions of the Act where the
approval of the Financial Secretary was required.
Key Sections of the PPP Act 2004 (Amended 2008)
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
Short title
Interpretation
Public-Private Partnership Unit
Responsibilities of contracting authority
Feasibility study
Public-Private partnership agreement
Referral to Central Tender Board
Pre-Selection of bidders
Invitation to bid
Powers of the Board
Award of project and signature of agreement
Regulations
Consequential amendment
Act not applicable
Commencement
Public Procurement Act 2006’s Impacts on PPPs:
The Public Procurement Act 2006 and Public Procurement Regulations 2006 aim to
delegate responsibility for procurement to public bodies within an overall
framework of principles, procedures and practices. The Act and Regulations and
amendments made in 2008 retain the role of Central Procurement Board in the
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
procurement stage of the PPP Project Cycle. The Public Procurement Office (PPO)
established by the Act sets procurement policy and issues procedures and standard
bidding documents. The definition of procurement would include procurement by
way of a PPP arrangement, although procedures and standard bidding documents
are clearly geared towards traditional procurement. The Director of the PPO is the
Chairman of the PPP Committee, which could lead to a conflict-of-interest in the
event of a dispute over a PPP procurement arising out of decisions taken by the PPP
Committee.
The Finance Act of July 2008 inserted Section 11A into the Public Procurement Act
2008 to provide as follows:
“notwithstanding the provisions of this Act, the Central Procurement Board
(a) shall approve all documents relating to the bid; (b) shall authorise,
approve and carry out pre-selection exercises; (c) shall authorise, the
advertisement, invitation locally or internationally, as the case may be, and
call for bids; (d) shall examine and evaluate bids; and (e) may approve the
award, of a public-private partnership project in the manner provided for
under the Public-Private Partnership Act 2004”.
The Central Procurement Board established under the Public Procurement Act 2006
replaced the Central Tender Board referred to in the PPP Act while a Procurement
Policy Office has also been established.
Appendix E below provides a detailed matrix that systematically analyses each of
the current PPP laws and regulations, identifies specific gaps and constraints that
must be addressed, and provides recommendations for how each should be resolved
through a strengthened legal framework for PPPs in Mauritius. This legal analysis
can be followed directly during the implementation of the recommendations to
revise the PPP Act, described at the end of this Chapter.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
4.3 Assessment of Issues & Constraints within the
Current PPP Legal Framework:
The Current Framework of PPP-Related Laws & Regulations is
Fragmented & Inconsistent:
The PPP Act 2004, the absence of PPP Regulations made under the PPP Act, the later
enactment of the Public Procurement Act 2006 and Public Procurement Regulations
2008, amendments in 2008 to the PPP Act and Public Procurement Act and
amendments to the PPP Regulations in 2009 have resulted in the legal framework
for PPP being disjointed, incomplete, repetitive in parts and yet not comprehensive.
The PPP Policy Statement was prepared prior to the PPP Act and the Public
Procurement Act and Regulations. The PPP Guidance Manual 2006 was prepared
prior to the amendment of the PPP Act and the enactment of the Public Procurement
Act and Regulations. As a result the PPP Policy Statement and the PPP Guidance
Manual are out of date in terms of descriptions of the project cycle and role of
different institutions in the legislation and in practice.
If Mauritius’ public administration was more familiar with successfully procuring
PPP, and if the PPP Unit had more resources and institutional clout, some of these
weaknesses of the current PPP legal framework might be surmountable. However,
currently in Mauritius, the limited experience with completing PPP transactions,
and limited capacity to absorb and apply guidance is weak throughout the public
administration. Moreover, the PPP Unit lacks the legal status to bring about the
needed changes: especially coordinating and overseeing the implementation of a
larger number of PPP transactions.
The Impacts of Current Constraints within the PPP Legal Framework:

The current PPP Act defines PPPs as contracts that are paid for through the
Government of Mauritius’ Consolidated Fund. However, many public
contracting authorities, such as the Central Electricity Board (CEB) among
59
Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
others, receive their revenues from end-user fees, which are not legally part of
the Government’s Consolidated Fund. This issue has posed an important
constraint to the preparation and signing of the Bigara Wind Farm PPP
project. Legally, such a contract would not be permitted under the current
PPP Act. This issue can also the ability to prepare and sign PPP contracts for
Mauritius other contracting authorities that would spend non-consolidated
fund revenues on PPP contracts.

The PPP Act defines a PPP as occurring between a private company and
either a line ministry or a public contracting authority. However, this does
not include publicly-owned corporations, such as the SLDC, SPDC, etc.
Therefore, according to the current PPP Act, these bodies not need to follow
the requirements of the PPP Act. This not only exposes the implementation
of several priority PPP projects to legal and procedural uncertainty; it also
exposes the MOFEE to the risk that these parastatals could enter into longterm contracts (outside the requirements of the PPP Act) that could become
unaffordable, not provide the public sector with better value for money, and
expose the public sector to significant fiscal risks.

The PPP Act does not provide for independent assessment of fiscal risk from
PPPs. MOFEE has no legal role through the Act in carrying out assessment of
the important fiscal risks associated with PPP arrangements. This is a major
vulnerable issue in the PPP Act. If fiscal risks of current and future PPP
contracts in Mauritius are not identified, analysed, and monitored, the could
end-up imposing substantial and unexpected new claims on limited fiscal
resources.

The PPP Unit is, in law, a statutory, unincorporated body that is located
within MOFEE that only has legal powers to deal with matters relating to a
PPP project that referred to it by the PPP Committee. This does not allow the
PPP Unit to become the driver of the entire PPP process in Mauritius, which
is the role originally called for it by the PPP Policy Statement of 2003. While
the PPP Unit current performs well, given its limited number of staff,
resources, and authority, it will be unable to drive the process of preparing
and implementing the larger portfolio of PPPs that is the Government’s
priority, unless its legal authority is specifically augmented.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework

The PPP Act gives the Central Procurement Board (CPB) the task of ensuring
the legitimacy and transparency of the procurement process. Contracting
authorities must submit a request for proposal to the CPB to obtain its written
authorisation to advertise, invite, solicit or call for bids. The CPB has little to
no knowledge or understanding of PPP projects and PPP feasibility studies
that have been prepared by a contracting authority and approved by the PPP
Committee. The role of the CPB envisaged in the PPP Act , including the
absence of a role for MOFEE and the limited roles of the PPP Committee and
PPP Unit, indicate a fundamental misunderstanding of the PPP Project Cycle
and in particular how the PPP procurement phase should be implemented.

Evaluation of PPP proposals requires not only a ranking between proposals
but evaluation of value for money, affordability, fiscal risk and risk transfer
elements of the proposals compared to expectations based on the PPP
Feasibility Study and market soundings. In traditional public procurement
the decision to procure has been taken by or on behalf of Government prior to
seeking proposals from bidders. In PPP the decision to procure is taken only
after the receipt and evaluation of proposals which show that there is value
for money to be obtained, satisfaction of the question of affordability,
adequate risk transfer to the private sector and limited fiscal risk.

The CPB is not be the appropriate body to approve the award of PPPs
because it is in many respects equivalent to making a decision to procure on
behalf of Government. While the Contracting Authority may be the entity
that makes the award on approval by the CPB, it would be difficult for a
Contracting Authority not to implement the approval of an award by the CPB
and would likely give rise to a claim for damages by the party whose
proposal was approved for award.

The PPP Committee’s functions are limited to those in the PPP Act and in
respect of a project this is confined to making an assessment of a project and
giving recommendations to the contracting authority.

The Contracting Authority is obliged by the PPP Act to show through the
feasibility study that a proposed PPP agreement is affordable to the
contracting authority, provides value for money and transfers appropriate
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
technical, operational or financial risk to the private party. However, this part
of the PPP project cycle is typically carried out by or on behalf of the Ministry
responsible for finance, by persons who are independent of the PPP process,
and not by either the Contracting Authority or the PPP Unit. In effect the
current PPP legal framework permits the Contracting Authority to state
whether a PPP agreement is affordable to the Contracting Authority.

The Finance (Miscellaneous Provisions) Act 2008 was previously used as the
legislative vehicle to amend the PPP Act through administrative procedure.
However, it is not an effective practice in legislative drafting to implement
substantial amendments to legislation through omnibus legislation. The need
for so many amendments to different legislation to be made each year
through the Finance (Miscellaneous Provisions) Act indicate deficiencies
within in the law-making process such as in the prior policy-making phase,
preparation and drafting the law, or in the parliamentary legislative process.

The Public Procurement Act 2006 brought further changes to the PPP legal
and institutional framework, and that Act has in turn been amended through
the Finance (Miscellaneous Provisions) Act 2008 to reiterate the role of the
Central Procurement Board in the PPP process set out in the PPP Act.

The Business Facilitation (Miscellaneous Provisions) Act 2006 Act No. 21 of
2006 Section 6 amended the Investment Promotion Act by inserting Section
18C providing that the Board of Investment may act as a coordinator and
facilitator between the PPP Unit and the private sector for the assessment of a
PPP project, its implementation, development and monitoring. This
legislative provision makes the institutional role of the PPP Unit less rather
than more clear as it relates to PPPs being facilitated by the Board of
Investment. Moreover, it underscores the problem within the PPP legal
framework that repeated administrative amendments made through omnibus
legislation may be easy to complete, but often do not provide the necessary
legislative clarity.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
World Bank PPPI Data Mauritius 1997‐2008
Energy
Telecom
Transport
Water / Sewage
No Projects
Value US$m
1997
1
‐
2 (ports)
‐
1
43
1998
2
‐
‐
‐
2
109
1999
‐
‐
1 (airport)
‐
1
2001
‐
1
‐
‐
1
2002
338
27
2003
‐
2
‐
‐
2
2
2004
1
1
‐
‐
2
26
2008
‐
‐
‐
1
1
17 (07/08 telecom)
No Projects
4
4
3
1
12
Value US$m
109
410 (379 divestiture proceeds)
43
562 [183 new]
The overall level of PPP projects that have been completed under the current PPP
legal framework has been limited. If PPPs are to reach the level of project
implementation that the Government of Mauritius intends, then a significantly
strengthened legal framework will be required.
The Need for Clear PPP Primary Legislation in Mauritius:
Given high expectations that the Government of Mauritius has for PPP projects, and
the constraints that PPP projects currently face, what is needed is a general legal
framework upon which clear and consolidated implementing regulations, PPP
procedures, and a PPP Guidelines Manual can be built. These tools, built upon the
framework of a PPP Act, are necessary to facilitate the completion of sound and
sustainable PPP transactions.
The main purposes of PPP primary legislation in the form of a PPP Act would be to:

Provide an enabling law for PPP that addresses obstacles and providing
certainty for the private sector and general public
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework


Address the roles and responsibilities of different parts of Government in PPP
matters
Establish Government institutions to advise and assist on PPP arrangements
The broad PPP legal framework which includes (primary and secondary legislation
– Act and Regulations) and supporting procedures, instructions and guidelines and
the PPP Manual should provide details on which part of Government is legally
responsible for matters that include:


















Investigating PPP proposals
Evaluating traditional procurement vs. PPP:
Consultation with general public / other Ministries:
Approvals and decisions, at what stages, and by which parts of Government:
Preparing documents for approval body:
Organising procurement of private partners:
Negotiations (to finalise agreements i.e. not bargaining on substance of
proposals):
Signing agreements:
Implementation of PPP project:
Monitoring and compliance of PPP performance:
Reporting: PPP unit reports on matter of general policy and projects to PPP
approval body and on day to day matters including administrative matters
MOFEE:
Transparency and accountability of PPP unit work / State Authority / PPP
partner - reports required etc
Disclosure of interests / conflicts of interests in projects and confidentiality
issues on Government side as well as on private sector side
Disclosure with publication of project information and details of PPP
agreements, with limited reliance on the need for commercial secrecy
Linking PPP with the budget, public capital programme and medium term
expenditure frameworks
Audit of PPP project performance – independent reviews, Director of Audit
effectiveness / performance audit to see if projections regarding PPP
procurement against traditional procurement were realised
Audit of PPP procurement processes
Dispute resolution - PPP dispute resolution provisions must work well in
practice to be credible.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
This PPP legal framework should address specific matters to assist smooth
implementation of PPPs, such as accelerating the conveyance and registration of
property, obtaining physical planning permission for strategic infrastructure, or the
power to enforce disclosure of information and co-operation within Government
although these aims would also apply to infrastructure procured by traditional
means. Other legal issues that should be addressed in Mauritius include: promotion
and protection of investments, property law, security interests, rules and procedures
on compulsory acquisition of property, general contract law, rules on government
contracts and administrative law, tax law, environmental protection and consumer
protection laws.
4.4 Evaluating the Options for Strengthening the
PPP Legal Framework:
Given this need to strengthen Mauritius’ PPP legal framework, there are two distinct
options for pursuing these recommended changes:
1. Develop a new PPP Act: design, draft, discuss, pass, and enact a New PPP
Act
2. Issue Administrative Changes to Existing Law: Draft and Adopt changes
to existing laws through the administrative process of issuing Ministerial
amendments to the Public Finance Act.
These two options contain important strengths and weaknesses that must be
evaluated before a recommended option should be proposed:
Option #1: Draft and issue Ministerial amendments to the PPP Act
2004
When the PPP Act of 2004 was amended in 2008, it was done through provisions
included in the Finance Act. This option can be convenient for short amendments
but is not suited to this situation where the revisions to the PPP Act are substantial
and comprehensive in terms of number of provisions.
Option #2: Draft a new PPP Act
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
A new PPP Act would reflect the restated policy and repeal the PPP Act 2004 (as
amended). Draft PPP regulations would then be made under authority given in the
draft Bill. The enactment of an updated PPP Act would not delay progress on all the
other recommendations for revision of policy, institutional framework and other
areas highlighted in this report.
Evaluation of Options: Ease of Implementation and Levels of
Improvement:
The following matrix summarizes two key characteristics of each option identified,
including the ease with which each option could likely be implemented and the
expected level of improvement in the overall PPP legal framework that each option
would likely deliver:
Options
Ease of Implementation
Issue
Administrative
Changes through
the Finance
(Miscellaneous
Provisions) Act



Easier to Implement
Can be achieved through
annual Finance
(Miscellaneous
Provisions) Act
Could be completed by
end of 2010
Level of Improvement Achieved
Moderate-level of improvements,
including:


Draft, debate,
pass, and enact a
New PPP Act



More difficult to
implement and complete
Requires review and
approval by Cabinet
discussion and passage by
the National Assembly
May require until 2011 or
later to complete, or
could fail to be passed
and enacted by the
National Assembly
Could provide specific new legal
definitions for “PPP,” and
“contracting authority,” and allow
PPPs for non-Consolidated Funds
Would not be appropriate for
strengthening legal authority,
status, and new role of the PPP
Unit.
Significant improvements:



Systematically complete both
specific, definitional changes to
PPP Act as well as strengthen the
legal authority, status, and new
role of the PPP Unit.
Could remove a wide-range of the
existing legal uncertainties and
constraints within current PPP
framework
Would ensure that both the PPP
Policy and the PPP Act are both
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Options
Ease of Implementation
Level of Improvement Achieved
clear and consistent regarding
definition, goals, and overall
process of implementing PPPs
 Raise private sector confidence in
Govt’s commitment to PPPs and
help raise future interest in PPP
investment opportunities
It should be noted that these two approaches are not mutually exclusive. It is
possible for the Government to pursue the option of making specific changes to the
existing PPP Act according to the recommendations in the short-term through
ministerial administrative mechanism, while pursuing a longer-term strategy
developing a new PPP Policy. While the Consultant Team recommends that the best
way for Mauritius realize the greatest potential benefits of a more effective PPP
framework will be through a new, rather than an amended PPP Act and
implementing regulations, it will be possible for the Government to still realize
important improvements in its PPP capacity by implementing these changes
through the simpler administrative process, such as inclusion of changes in the
Finance (Miscellaneous Provisions) Act.
4.5 Recommendation: Draft New PPP Act and PPP
Implementing Regulations
Recommended Actions: Draft and enact a comprehensive PPP Act, which repeals
the earlier PPP Act of 2004, along with clear, supporting PPP Regulations. This
legislation will provide authority to issue procedures, guidelines and instructions
for the PPP process, which are described below in Chapter 6 of this Report. The
essential elements that should be addressed in the new PPP Act should include the
following key provisions, prepared according to the legislation style of Mauritius:
Recommended Outline & Key Contents for a New Draft PPP Act
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The following is a recommended outline for the organization and design of a new
PPP Act. A more detailed description of the recommended contents and key
provisions of a new PPP Act is included in Appendix G below.
PART I. – PRELIMINARY
 INTERPRETATION – DEFINES TERMS USED IN THE BILL
PART II. – PUBLIC PRIVATE PARTNERSHIP ARRANGEMENTS
Powers in Relation to Public Private Partnership Arrangements
 STATE AUTHORITY / CONTRACTING AUTHORITY
 PUBLIC PRIVATE PARTNERSHIP ARRANGEMENTS
 DEALING WITH PROPERTY IN CONNECTION WITH A PUBLIC PRIVATE
PARTNERSHIP ARRANGEMENT
 FUNCTIONS AND RESPONSIBILITY IN PUBLIC PRIVATE PARTNERSHIP
ARRANGEMENTS
 EFFECT OF PRIOR PUBLIC PRIVATE PARTNERSHIP ARRANGEMENT
 DIRECTIONS REGARDING PUBLIC PRIVATE PARTNERSHIP ARRANGEMENTS
 ACQUISITION OF LAND FOR PUBLIC PURPOSES AND PPP ARRANGEMENTS
PPP Project Analysis, Procurement, Audit and Assessment
 PUBLIC PRIVATE PARTNERSHIP PROJECT ANALYSIS AND PROCUREMENT
 OBLIGATION ON STATE AUTHORITY TO REGISTER PROJECT WITH PPP UNIT
 PUBLIC FINANCE EXPOSURE TO PUBLIC PRIVATE PARTNERSHIP
ARRANGEMENTS
PART III. – “THE PUBLIC PRIVATE PARTNERSHIP UNIT”
Public Private Partnership Unit.




ESTABLISHMENT OF THE “PUBLIC PRIVATE PARTNERSHIP UNIT”
FUNCTIONS OF THE “PPP UNIT”
POWERS OF THE PPP UNIT.
CODE OF PRACTICE
PPP UNIT Management and Employment
 PPP UNIT CHIEF EXECUTIVE OFFICER.
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



STAFF OF THE PPP UNIT
PPP UNIT AGREEMENTS WITH STATE AUTHORITIES AND PUBLIC ENTITIES
PPP UNIT PROCEDURES, GUIDELINES AND INSTRUCTIONS.
PPP UNIT TENDERS AND CONTRACTS
PPP UNIT Reporting Requirements and Supervision




PPP UNIT SIX MONTHLY REPORT
PPP UNIT ANNUAL REPORT.
PPP UNIT ANNUAL PLAN AND CORPORATE PLAN
SUPERVISION AND EXTERNAL GOVERNANCE OF PPP UNIT
PART IV. – FINANCIAL REPORTING, ACCOUNTING RECORDS, AND
AUDIT







INTERPRETATION
PREPARATION OF FINANCIAL STATEMENTS
ACCOUNTING RECORDS TO BE KEPT.
FUNDS OF THE PPP UNIT.
LIABILITY TO TAXATION.
AVAILABILITY OF ANNUAL REPORT.
AUDIT
PART V. – PUBLIC PRIVATE PARTNERSHIP COMMITTEE






ESTABLISHMENT OF PUBLIC PRIVATE PARTNERSHIP COMMITTEE
MEETINGS OF PPP COMMITTEE
DECISIONS WITHOUT MEETINGS
FUNCTIONS OF THE PPP COMMITTEE
POWERS OF THE PPP COMMITTEE
DELEGATION
PART VI. – PPP FORUM
 CONVENING OF AND PROCEEDINGS AT PPP FORUM WITH PRIVATE
SECTOR.
PART VII. – MISCELLANEOUS
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










DISCLOSURE OF INTERESTS
CONFIDENTIALITY
OFFENCE OF LOBBYING
SERVICE OF PROCESS
RECOVERY OF MONEYS DUE
PROTECTION FROM PERSONAL LIABILITY
GENERAL PENALTY.
INFORMATION.
FALSE STATEMENTS
REGULATIONS.
PROSECUTIONS.
Recommended Actions:
1. In accordance with the established process for preparation of draft legislation in
Mauritius, the PPP Unit should be directed to prepare a draft PPP Act and PPP
implementing regulations in consultation with stakeholders and specialist legal advice
within different parts of Government.
2. PPP Unit’s new PPP Framework & Capacity-Building Manager will need to engage the
specialised support of a PPP legal adviser for this legislative drafting activitiy. (A full
copy of the Terms of Reference for recruiting and hiring the individual is included in Appendix G
of this Report). For consistency, coherence and synergy the PPP policy, legal and
institutional individual advisers should be part of one team that examines each of these
subject areas.
3. Draft PPP Bill and Regulations are prepared and submitted for consideration by the PPP
Committee, the Finance Secretary before being revised and circulated for observations
within Government and the obtaining of approval to introduce the PPP Bill in
Parliament in accordance with established procedures.
4. PPP Bill is introduced in the National Assembly.
5. Annual evaluation review of the PPP Law is conducted by the PPP Unit, supported by
specialists as necessary, to determine if it should be modified and improved.
The recommended activities for the strengthening of PPP policy, PPP legal and PPP
institutional matters are inherently linked. The implementation of all three of these
recommended activities should proceed together. Otherwise there will be an
elongated time frame as different specialists are engaged sequentially for each of
these steps. Moreover, there is a high probability of delays to reconcile what will
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almost inevitably be variations in approach or emphasis favoured by the various
advisers.
Monitoring of Actions: The PPP Unit’s progress and completion of this activity will
be monitored by PPP Committee under existing arrangements and by MOFEE
Finance Secretary. The PPP Unit will monitor the legal and institutional consultants.
Required Resources:
1. Directing of existing resources at PPP Unit, the PPP Committee, the MOFEE’s Finance
Secretary, Government legal advisers, the Cabinet, and other stakeholders to the above
tasks.
2. As proposed in Section 5.1 below (Design and Organization of the PPP Unit), it is
recommended that the PPP Unit hire a full-time PPP Framework Development &
Capacity-Building Manager. A full copy of the Terms of Reference for recruiting and hiring
the individual is included in Appendix G of this Report. This specialist will provide a
significant amount of the human resources to coordinate this activity. However,
additional specialised PPP legal expertise will also be required.
3. The PPP Unit and its PPP Framework Development & Capacity-Building Manager will
also need a specialised legal consultant to support the drafting of the PPP Act and of its
important implementing regulations. Because this Activity is so closely linked with
recommended revision and strengthening of the PPP Policy, it is recommended that the
same PPP Policy and Legal Specialist be retained to support both of these activities. The
estimated level of effort of this consultant to complete this one activity is:
o PPP Policy and Legal Specialist = 60 days
S.M.A.R.T Analysis of Recommended Activity:
Recommendation: Design, Draft, and Pass a New PPP Act & Implementing Regulations
Specificity: How is it Specific?
This will consist of two specific documents (the new PPP Act, and its
Implementing Rules & Regulations). These will be clearly based on
the principles contained in the revised PPP Policy Statement.
Specific recommendations for the contents of the new PPP Act have
already been identified.
Measurable: How will it be
Successful completion of this activity can be clearly measured by
whether or not the new PPP Act and its Regulations are both drafted
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Recommendation: Design, Draft, and Pass a New PPP Act & Implementing Regulations
Measured?
by the PPP Unit, and if it is adopted by the Cabinet, and passed by
the Parliament
Achievable: Is the task
achievable, and what does
Achievement look like?
Completion of the design and drafting of the PPP Act and its
Regulation will not difficult for the PPP Unit to achieve. A detailed
list of the key contents of the PPP Act has already been provided in
this Report. The decision by the National Assembly to approve the
new PPP Act could be subject to the risk of delays.
Relevance: Why is it Relevant
to the overall
program/strategy/goals?
The new PPP Act and Regulations would finally provide the PPP Unit
with the official powers and status it needs to accelerate and expand
the completion of PPPs in Mauritius. It will also clarify the process of
PPP implementation for line ministries and the private sector.
Without this foundation the potential for PPP transactions to be
completed in Mauritius will remain very limited
Timeliness: By when will be
achieved?
The drafting of the PPP Act and its Regulations can be done while the
PPP Policy Statement is being designed and drafted. However, first
the principles of the new PPP Policy Statement must be adopted
before the drafting of the Law and Regulations can be completed.
The drafting of the Act and Regulations can be completed 1.5 months
after the Cabinet adopts the PPP Policy Statement. The discussion
and passage of the PPP Act by the National Assembly may require an
additional 4-6 months depending the political priorities at the time.
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Timing of Activity:
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5. Assessment and
Recommendations for Design
and Organization of the PPP Unit
and PPP Committee
Summary of Assessments & Recommendations for Design &
Organization of the PPP Unit and PPP Committee






The functions of the PPP Unit have diminished from their original scope under to the PPP Policy
of 2003, due to subsequent amendments to the PPP Act.
To meet the goals of Mauritius’ PPP strategy, the recommended roles of the PPP Unit should
include: encouraging and advising contracting authorities on PPPs, reviewing PPP proposals and
advising the PPP Committee, Coordinate development of PPP framework, Develop Government’s
PPP procedures, Coordinate PPP capacity-building, and Serve as the Country’s PPP knowledge
center.
The organization and functions of the PPP Committee should be revised to include: Oversee and
monitor development of the PPP framework, Advise Government on PPP strategy decisions,
Appoint the PPP Project Team for specific PPP projects, Review the PPP programme to ensure
transparency, fairness, and public education
The development of Key Performance Indicators (KPIs) for the PPP Unit should occur after the
foundational issues of revising the PPP Policy, revising the PPP Act, and developing the PPP
Unit’s long-term Corporate Plan have been completed.
Specific recommended actions to strengthen the PPP Unit include the hiring a Resident PPP
Adviser, a PPP Framework Development & Capacity-Building Manager, as well as Chief Executive
for the PPP Unit
Terms of References for each of these three positions are included in Appendices H, I, and K at
the end of this Report.
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5.1 The Current Design & Institutional Roles of
PPP Organizations:
The PPP Unit was first established in 2001, but its institutional role was set out by
the PPP Policy Statement 2003, and through the PPP Act 2004 (prior to
amendments). Located within the Ministry of Finance & Economic Empowerment
(MOFEE), the PPP Unit initially reported on PPP matters through MOFEE’s Finance
Secretary. However, amendments to the PPP Act in 2008 require the PPP Unit to
report to a PPP Committee, consisting of representatives from the Public
Procurement Office, the MOFEE,
Although it has been under-resourced, the PPP Unit currently has the following
functions:





Works with contracting agencies to select and analyze potential PPP projects
Together with contracting agencies, oversees PPP transaction advisors and a
portfolio of the six PPP projects is currently being prepared for tendering and
the ten additional candidate projects are being analyzed.
Coordinates the process of analyzing the existing PPP legal and institutional
framework, proposing changes, and the design and implementation of a new
PPP framework
Helps coordinate the PPP training and capacity-building needs of Mauritius
Serves as the source of information on PPP issues, projects throughout
Mauritius for the private sector, donors, and within the Government
The PPP Unit’s Limited Institutional Role:
As noted in the previous Chapter’s assessment of the PPP legal framework, the PPP
Unit’s legal status is significantly limited. For a detailed, comparative assessment of
the legal role and status of the PPP Unit compared to the other key Government
bodies (MOFEE, PPP Committee, CPB, etc.) see the comparative analytical matrix in
Appendix C: Statutory Roles of Government Institutions in Current PPP Legal
Framework.
As a result the PPP Unit is not able to adequately supplement the PPP project
preparation work of contracting authorities, or the PPP review and oversight work
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
of the Central Procurement Board (CPB). The PPP Unit’s statutory responsibilities
have been further diminished by the amendments made to the PPP Act in 2008. The
PPP Unit needs to be established as a statutory, unincorporated body similar in
status to the Public Procurement Office to strengthen its status and role, provide it
with resources and make it a leader and driver of PPP within Government and not a
passive reactor to requests.
Strengthening Mauritius’ PPP framework will require that a larger role be played by
a stronger PPP Unit. This can be achieved through new PPP primary legislation that
establishes the PPP Unit as a statutory agency with a Chief Executive and with the
power to engage administrative support staff and a team of professional advisers
(both local and international) who may be engaged on fixed term contracts of
employment or on contract for services. The PPP Unit reports to MOFEE on
administrative matters through the Chief Executive and reports on PPP matters to
the PPP Committee.
The specific recommended functions of the new PPP Unit should be to:





Encourage Contracting Authorities to consider public private partnership arrangements
as a method of procuring infrastructure;
Advise and assist Contracting Authorities on all aspects of public private partnership
arrangements;
Review and evaluate proposals for projects and advise the PPP Committee on
identifying if public private partnership is the most appropriate means of implementing
a project;
Advise and assist the PPP Committee:
o In reviewing public private partnership policy and programmes on policy,
o In pricing and regulatory issues that may have an impact on public private
partnership arrangements having consulted with the appropriate regulatory
authorities;
o On options and reforms, including regulatory reforms, to remove barriers and
make public private partnership arrangements more efficient; and
o On mechanisms for financing investment in public private partnership
arrangements;
Coordinate the implementation of public private partnership policy, programme and
projects by the Government and local-level Governments;
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework






Build capacity in State Authorities for public private partnership arrangements and
promote good practice and knowledge sharing with State Authorities and the private
sector;
Serve as Mauritius’ “PPP Knowledge Center” by maintaining a central repository of all
documentation and records, including agreements, about public private partnership
arrangements;
Compile and submit to the Minister on a quarterly basis a record of payments, receipts,
liabilities, including contingent liabilities, guarantees and other information connected
with public private partnership arrangements;
Act as secretariat to the PPP Committee and the PPP Forum;
Issue procedures, guidelines and instructions in relation to public private partnership
arrangements; and
Perform any other function concerning public private partnership arrangements or
infrastructure procurement or development that:
o The Minister for Finance requests the PPP UNIT in writing to perform; or
o That is incidental or ancillary to any of its functions.
The PPP Unit’s Limited Human & Financial Resources:
The PPP Unit currently has only two staff full-time staff members, who are
competent and knowledgeable MOFEE civil servants. However, without additional
human or financial resources of its own, the PPP unit lacks the capacity to have the
level of impact that is required to bring about a dynamic PPP implementation
throughout the public administration system.
PPP Committee
It is proposed that the PPP legislation clarify the institutional role of the PPP
Committee. An illustrative list of members of the Committee would include:






Permanent Secretary MOFEE
Finance Secretary, MOFEE
Permanent Secretary, Ministry of Infrastructure
Permanent Secretary, Ministry of Public Utilities
Permanent Secretary, State Law Office
Chief Executive of the PPP Unit attends PPP Committee but is not a member.
The recommended functions of the PPP Committee are:
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








Oversee and monitor the development public private partnership policy and
framework;
Ensure that the public private partnership policy and programme are
implemented in a manner to achieve the aims of the policy and programme;
Recommend to and advise Government on measures that may be taken to
further public private partnership policy and programme generally;
Consider matters relating to public private partnership arrangements that are
referred to it by the Minister for Finance or Government or that are brought
to its attention by the Chief Executive Officer of the PPP Unit and make
recommendations to and advise Government on these matters;
Make recommendations to Government on an individual public private
partnership project or group of projects;
Appoint members of a team (e.g. PPP Project Team) to carry out tasks in
connection with public private partnership arrangements and to specify the
tasks to be carried out;
Ensure that the public private partnership policy and programme and the
implementation of projects under that policy and programme are conducted
with integrity in a fair, transparent and accountable manner;
Ensure that public communications and interaction with the private sector on
public private partnership is successful in building understanding and
confidence among the general public, potential investors and lenders; and
Generally to do such supplementary, incidental or consequential acts and
things as are necessary or convenient for carrying out its functions.
PPP Project Team
The PPP legislation should provide that a PPP Project Team be appointed by the
PPP Committee for different phases of the PPP Project Cycle. While the composition
of the team may vary throughout the cycle, individuals from the Contracting
Authority, MOFEE and the PPP Unit would be included in the team. It might be
desirable for the Contracting Authority to lead the Project Team in the Inception
Phase and for the PPP Unit to lead the Project Team in the PPP Feasibility and
Procurement Phases. The team would be a working task force, and not a committee
that merely sits periodically to review reports. Much of the work of the team would
be carried out by or through the PPP Unit which would act as secretariat to the
team. The PPP Project Team will express its views on the matters that come before it
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and these views along with those of MOFEE and stakeholders are communicated to
the PPP Committee by the PPP Unit. The Head of the relevant Contracting
Authority should appoint a project officer to take responsibility for active
participation by the Contracting Authority in the PPP project cycle. The Head of the
Contracting Authority should appoint a process auditor who will assure the Head of
Department that all required steps set out in the PPP project cycle procedures are
applied in a proper manner.
PPP Forum
The PPP legislation should also provide for the establishment of a new PPP Forum
made up of representatives of the public and private sectors interested or involved
with PPP. It would be required by the PPP law to meet twice yearly or at other times
where members demand a meeting. The PPP Unit would act as secretariat to the
PPP Forum and the PPP Committee would attend meetings of the PPP Forum.
PPP Process Auditor
The Process Auditor is an individual appointed by the Head of the Contracting
Authority to verify that the required PPP procedures, guidelines and instructions
have been applied. The Process Auditor should record steps taken to comply with
legislation, procedures, guidelines and instructions as well as Cabinet and PPP
Committee decisions and directions.
The purpose of the Process Auditor is to identify any issues of material concern for
the Head of a State Authority during the PPP Project Cycle. The Process Auditor’s
role gives assurance to the Head of a State Authority, while minimizing the need for
detailed involvement unless a material concern arises. The role of the Process
Auditor does not extend beyond the award of the PPP contract. On occasions the
individual who undertook the role of the Process Auditor may be required to make
available knowledge gained during the process, for the benefit of a project review
after award of contract.
Role of the Project Officer and Process Auditor
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The Project Officer is the person nominated by a State Authority as the lead
individual with responsibility for the monitoring and implementation of a project
through the PPP Project Cycle until completion of the contract, but the role ceases at
construction and operation. At the inception phase of the project, the Contracting
Authority and Project Officer will not know if traditional public procurement or PPP
procurement will ultimately be chosen or if the project will be realized at all. The
Project Officer should ensure that the initial stages of all projects, prior to the
determination of the appropriate procurement mechanism, are in accordance with
Government guidelines for appraisal and management of capital expenditure
proposals generally.
To obtain required approvals to proceed through the various Phases, Stages, Steps
and Activities of the PPP Project Cycle, the Project Officer should:



Register the project with the PPP Unit;
Provide all relevant documentation to the PPP Process Auditor and ensure that the
Process Auditor is informed of all matters relating to the project. The Project Officer
should be obliged to respond positively and promptly to requests for information by
the Process Auditor;
If following completion of the PPP Feasibility Study the Project is approved to be
procured by way of PPP by the PPP Committee and Cabinet, bring all substantive
matters to the attention of the Head of State Authority for approval.
Documentary evidence outlining the consideration of and the basis for decisions
taken at each defined stage should be maintained on behalf of the State Authority by
the Project Officer.
Preparing for the PPP Unit’s Corporate Plan, Annual Business Plan, and
Key Performance Indicators (KPIs):
It is recommended that the PPP Unit become the authorized leader and driver of the
PPP process, as was envisaged in the PPP Policy Statement 2003 and the PPP Act
2004 as enacted, and change from being the largely reactive, administrative office
within the Ministry that it now is, due to the important amendments to the PPP Act.
If this recommended change in the strategic role for the PPP Unit is accepted by
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Government, the next step would feature conducting a strategic planning process to
specifically link the PPP Unit’s performance with the PPP Policy’s objectives.
Key performance indicators (KPIs) for the PPP unit should emerge after a PPP
policy-making and PPP Unit strategic planning process. KPIs for the PPP Unit
should not be created in isolation. The chain of organizational development
requirement that finally produces effective KPIs for the PPP Unit must include:

1st - Clearly defining Mauritius’s specific PPP policy objectives,

2nd - Finalizing the PPP legal and institutional framework to meet those
policy objectives

3rd - Structuring the PPP Unit’s 3-5 year Corporate Plan,

4th - Designing the PPP Unit’s Annual Business Plan,

5th - Preparing individual employee performance plans to meet the targets
of the Unit’s Business Plan.
When this process is followed it will ensure that the PPP Unit’s day-to-day activities
are directed towards specific performance outcomes that achieve clear PPP policy
objectives. Therefore, these important recommended PPP policy objectives must first
be reviewed and approved by Government for this process to begin.
Analysis, planning and measuring the performance of the PPP Unit through Key
Performance Indicators (KPIs) will be essential to ensuring that the PPP Unit is both
doing the right things as well as doing things right. The PPP Unit’s performance
should not simply be measured by the number of PPP projects and transactions that
are implemented, but also by the performance of those projects and by the quality of
its advice that recommends whether or not to enter a PPP arrangement.
The eventual development of PPP Unit’s Corporate Plan will derive from an
analysis of the strengths, weaknesses, threats and opportunities of:
(a) The PPP Unit,
(b) The PPP legal, institutional framework and
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
(c) The PPP business environment in Mauritius and identification of what is
needed to achieve the approved PPP policy objectives.
The PPP Unit’s day-to-day staff activities will be connected through the
development of an Annual Business Plan, which will set performance goals for each
activity being undertaken in pursuit of achieving the objectives of the PPP Unit’s
Corporate Plan. These goals should be objective, quantifiable and measurable. The
Annual Business Plan will also set out the operational resources (human resources,
financial resources, IT, etc.) that will be required to achieve these goals and will
identify those KPIs that will measure results. The KPIs will be linked to individual
employee performance plans which will set out tasks and targets for individual staff
members.
The organisation structure, staffing requirements and specific job descriptions for
the PPP Unit must reflect these final PPP policy objectives, the strategy contained in
the PPP Unit’s Corporate Plan, as well as the PPP Unit’s Annual Business Plan.
Therefore, the organisation structure, staffing and job descriptions must follow from
these important precedents and cannot be decided in isolation. To devise and
execute the steps within the approved PPP project cycle in Mauritius, the PPP
capability of staff in the PPP unit and other parts of Government will need to be
developed through training and skills development.
Finally, management of the PPP Unit should strive for a vibrant, open ethos and
style that seeks to improve the quality of analysis, planning, decision-making and
implementation of PPPs between the PPP Unit, different parts of Government and
the private sector. It is often difficult to create this ethos and style within the
traditional bureaucratic structure of Government Ministry.
5.2 Recommended Actions: Recruit and Hire a
Chief Executive, a Resident PPP Adviser, and a
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PPP Framework & Capacity-Building Manager for
the PPP Unit
To strengthen the PPP Unit according to the recommended provisions of the
revisions to the PPP Act, it should be provided with key human resources. Three
specific positions that should be filled include:



Resident PPP Adviser,
PPP Framework Development & Capacity-Building Manager, and
Chief Executive.
1. The PPP Unit should hire a PPP Resident Adviser to coordinate and manage the Unit’s
activities in helping identify new PPP project and helping contracting authorities to
review the work of PPP transaction advisors. A key purpose of this position will be to
transfer important PPP transaction oversight and management skills, models, and
procedures to other members of the PPP Unit Team. When available, the Resident PPP
Adviser will be expected to advise on the PPP Unit’s other activities, such as
strengthening the PPP legal and institutional framework, and conducting PPP capacitybuilding events. A full copy of the recommended Terms of Reference for recruiting this
Resident Adviser is included in Annex 1 of this Report. The specific framework development
responsibilities of this Resident PPP Adviser include:
o Identifying new PPP projects in Mauritius
o Screening identified projects for the suitability to be analyzed as PPP
candidates;
o Preparing terms of reference of PPP consultants and transaction
advisers to conduct PPP project screening analyses, feasibility studies,
tenderings, and other specific tasks;
o Reviewing PPP consultant and transaction advisor qualifications and
proposals and selecting preferred bidders
o Supervising and reviewing PPP feasibility analyses, including Public
Sector Comparison (PSC) and Value for Money (VfM) analyses, and
PPP project risk-allocation structures;
o Supervising and reviewing PPP transactions through tendering and
financial closure;
o Evaluating PPP proposals from private developers
o Communicating with private lenders and investors on PPP investment
requirements, financing strategies, and opportunities
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o Designing, drafting and establishing key models, documents, and
standardized procedures for the PPP Unit to screen, analyze, structure,
tender, complete, and monitor PPP transactions.
2. The MOFEE should create the position of Chief Executive of the PPP Unit to coordinate
and overseas all of the PPP Unit’s activities and staff in accordance with the new power,
duties, and functions to be given to the PPP Unit through the revised PPP Act. A full
copy of the recommended Terms of Reference for recruiting this Chief Executive is included in
Annex C of this Report. The specific framework development responsibilities of this Chief
Executive would include:
o Overseeing the execution of the PPP Unit’s entire work plan of
activities, including the preparation and completion of PPP
transactions, the strengthening the legal & institutional framework,
PPP capacity-building, and other special PPP initiatives.
o Ensuring that the Government’s overall process of preparing,
structuring, approving, tendering, awarding, and signing PPP
contracts is effective and efficient.
o Supervising the Resident PPP Adviser’s coordination of the PPP Unit’s
project identifications, screening, feasibility analysis, tendering, and
completion of PPP projects and transactions
o Supervising the PPP Framework Development & Capacity-Building
Manager’s coordination of the PPP Unit’s policy, legal, institutional,
and capacity-building initiatives.
o Executing the management of the PPP Unit’s budget and reporting
functions
o Officially representing the PPP Unit on its Governmental Committees,
including specific PPP project committees, the PPP Forum, special
training & capacity-building events sponsored by the PPP Unit, etc.
o Ensuring the effective knowledge-transfer and on-the-job-training
occurs from the Resident PPP Advisor and any other PPP specialists to
the staff of the PPP Unit, to ensure the long-term capacity of the PPP
Unit as an institution.
o Effectively representing the PPP Unit to private infrastructure sector
investors and lenders interested in bidding on PPP opportunities.
o Communicating with public and private sector leaders and the press
on Mauritius’ PPP framework and PPP projects.
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3. The PPP Unit should hire a new PPP Framework and Capacity-Building Manager. This
experienced Manager will dedicate approximately 50% of his/her time to coordinating
the PPP Unit’s Work Plan activities that deal with strengthening the PPP legal and
institutional framework. A full copy of the recommended Terms of Reference for recruiting
this Manager is included in Annex 2 of this Report. The specific framework development
responsibilities of this Manger include:
o Managing the PPP Unit’s work plan of activities in strengthening the
legal & institutional framework
o Coordinating the development, drafting, communication, and
adoption of a strengthened PPP policy statement
o Coordinating the development, drafting, communication, and
adoption of a strengthened PPP Act and associated implementing rules
and regulations
o Coordinating the development of the PPP Unit’s organizational
procedures, including the development an updated Manual of PPP
Guidelines
o Coordinating the establishment of a PPP Forum of key public and
private sector leaders to ensure better communication and cooperation
on PPPs in Mauritius
o Preparing terms of reference for and overseeing the activities of PPP
legal and institutional specialists engaged to assist the PPP Unit’s
framework development activities
o Communicating with public and private sector leaders and the press
on Mauritius’ PPP framework.
4. Initiate stakeholder consultations on the proposed policy, legal and institutional
framework and develop a communications strategy to ensure smooth adoption of policy
and enactment of legislation and institutional changes.
5. The PPP Unit should continue to work on existing portfolio of PPP projects but apply
the improved approaches being developed.
6. Annual evaluation review of the PPP Unit’s design is conducted by an outside PPP
institutional specialist, to determine if the Unit organization or operations should be
modified and improved.
Monitoring of Actions: The PPP Unit’s progress and completion of this activity will
be monitored by the PPP Committee and by MOFEE Finance Secretary. The PPP
Unit will monitor the consultants it has engaged to support drafting of the PPP law
and procedures.
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Required Resources:
1. Direct the existing resources at PPP Unit, the PPP Committee, the MOFEE’s Finance
Secretary, the Cabinet, and other stakeholders to coordinate and oversee the above tasks.
2. For the hiring of these three new positions in the PPP Unit, the following levels of effort
will be required.
o PPP Resident Adviser = full-time position for 2-years
o PPP Framework Development & Capacity-Building Manager = full-time position
o PPP Unit Chief Executive = full-time position (replacing the current Director
position)
S.M.A.R.T Analysis of Recommended Activity:
Recommendation: Recruit and Hire a Chief Executive, a Resident PPP Adviser, and a PPP
Framework & Capacity-Building Manager for the PPP Unit
Specificity: How is it Specific?
This will consist hiring of three specific individuals to fill three
defined positions within the PPP Unit:
o
PPP Unit Chief Executive
o
PPP Framework
Manager
o
PPP Resident Adviser
Development
&
Capacity-Building
Measurable: How will it be
Measured?
Successful completion of this activity can be clearly measured by
when all three positions have been filled and the individuals have
commenced duties.
Achievable: Is the task
achievable, and what does
Achievement look like?
Completion of these will not be difficult to achieve. Specific Terms
of Reference for all three positions have been provided, and the
MOFEE has indicated that it is willing to dedicate resources needed
for these positions. The MOFEE and the PPP Committee will need to
approve the decisions to recruit and hire these positions
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Recommendation: Recruit and Hire a Chief Executive, a Resident PPP Adviser, and a PPP
Framework & Capacity-Building Manager for the PPP Unit
Relevance: Why is it Relevant
to the overall
program/strategy/goals?
Both the current PPP Unit, as well as the recommendations for the
powers, functions, and duties of the PPP Unit in the future require
more human resources. These 3 positions will help the PPP Unit to
implement more PPP projects, the strengthen its role under a revised
PPP framework, and to build the PPP capacity within Mauritius. If,
however, these actions are done without the completing the
strengthening of the PPP policy and the PPP Act and its Regulations,
the ability of these additional staff to realize the goals of Mauritius
PPP program will not be as effective as it should be.
Timeliness: By when will be
achieved?
The recruitment of the PPP Resident Advisor and the PPP Framework
& Capacity-Building Manager can begin as soon as the MOFEE and the
PPP Committee authorize it. It will likely require 2-3 months to fill
these positions. The position of Chief Executive of the PPP Unit may
require longer as it is dependent on changing the legal status of the
PPP Unit as a statutory body, as recommended under a revised PPP
Policy and Law.
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Timing of Activity:
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6. PPP Project Evaluation and
Preparation Procedures:
Summary of Assessments & Recommendations for PPP Evaluation
and Preparation Procedures





The current process for identifying, preparing, tendering, evaluating, and completing PPP projects is
unclear, lengthy and cumbersome, and it has constrained the completion of PPP transactions in
Mauritius
The current process for identifying candidate PPP projects prescribed by the Investment Projects
Process Manual is not facilitating the identification of appropriate projects for PPPs. Contracting
authorities do not have the capacity to identify PPP project candidates.
The Current PPP Guidance Manual, drafted in 2006, is not viewed as relevant by the Government, and
the PPP Unit is not using it to guide the preparation and evaluation of current PPP Projects.
Specific recommendations to improve Mauritius’ PPP procedures include: Appointing the head of the PPP
Unit to the Project Plans Committee (PPC), Requiring that MOFEE’s Debt Management Office perform
fiscal risk assessments of PPP projects, Change the Central Procurement Board’s role with an enhanced
role for the PPP Committee in evaluating & awarding PPPs, and allow the PPP Unit and the PPP
Committee to directly retain PPP advisors.
A list of the recommended procedures to be included in a new PPP Guidance Manual has been provided
in this Section of the Report.
6.1 The Current Process for Preparing and
Evaluating PPPs in Mauritius:
An important current constraint to PPPs in Mauritius is the required system of
procedures and approvals for PPP projects. The three figures below depict the
sequence of steps in the current process carried out by the different institutions.
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Figure 3. Process Flow for the Current PPP Project Life-Cycle in Mauritius
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This sequence of PPP procedural steps and approvals, summarized above, has
grown in a “bottom-up” fashion as interest in PPPs in Mauritius has grown during
the past decade, and as new initiatives and institutions like the PPC and PSIP have
been created and have been added to the PPP process. Leaders in both Government
and in the private sector in Mauritius have reported this current process to be
cumbersome, often hampered by delays, as well as difficult to understand. All of
these assessments make PPPs appear less attractive as an option to be explored.
What is needed is a more rigorous “top-down” approach to restructuring the
required process for evaluating, preparing, approving, and implementing PPPs.
This should be reflected in a revised PPP Guidance Manual.
Identification of Public Investment Projects and PPPs
Mauritius has made significant progress in moving towards a modern public
financial management and public procurement framework where Ministries and
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agencies have more delegated responsibilities. Reforms and regeneration of public
debt management, medium term expenditure frameworks and public sector
investment planning are being implemented. Multi-annual budgeting suits PPP
arrangements which are long term in nature. The Public Sector Investment
Programme (PSIP) is prepared by the PSIP unit at MOFEE. Under the Public Sector
Investment Program (PSIP), all line ministries, contracting authorities, and public
corporations must submit summary information about their new investment
projects to the Project Plans Committee (PPC). These submissions must follow the
format and instructions provided by the Investment Projects Process Manual
(IPPM).
The initial results of the PPC’s review and approval of the public sector investment
projects reveal that:


Public investment projects in sector that already feature the collection of fees from endusers (such as ports, water, electricity, etc.) are more likely to attract public sector
financing.
Line ministries, contracting authorities, and public corporations are more likely to
prepare and propose new investment projects that they are confident can attract
traditional public sector financing
The current process for the identification and selection of public infrastructure
projects in Mauritius is based on the assumption that infrastructure will be publiclyfinanced. The process for the identification, selection, and approval of infrastructure
projects should be revised to consider PPP options earlier in the project
development life cycle. Line ministries, contracting authorities, and public
corporations need to receive clearer policy guidance on when and for what reasons
Mauritius should consider PPPs. If the reason for PPPs in Mauritius is only to
consider PPPs in causes where traditional, sovereign-guaranteed financing is
unavailable, then the future scope of PPPs in Mauritius will be very limited. If the
reason is to consider PPPs in those cases where the private sector can be expected to
provide improved level of service (which includes timeliness, quality, reliability,
etc.) and therefore better value for the public’s money, then PPP options need to be
considered prior to the adoption of the PSIP.
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Most of the line ministries, contracting authorities, and public corporations
contacted and interviewed during this assessment agreed that while they were
interested in learning more about how PPPs could be applied to their current list of
priority investment projects, they believe that they understand the process for
obtaining traditional public sector financing better, and that they would prefer to
rely on this process.
Investment Project Process Manual (IPPM) –
Under the current procedures of the Investment Project Process Manual (IPPM) the
focus is predominantly on financing. There is no mention of risk transfer to private
sector in PPP arrangements. There is risk assessment for traditional procurement of
projects. The Financial Secretary said PPP was not required for financing reasons but
solely to achieve “transfer of risk”.
Investment projects normally are large, non-recurring expenditures which involve
multi-year funding, have a useful life greater than five years, are based on a
comprehensive needs assessment, meet an essential public purpose, and require
public accountability for funds.
The Projects Plan Committee (PPC) is set up in the Ministry of Public Infrastructure,
Land Transport and Shipping. The Permanent Secretary of the Ministry of Public
Infrastructure, Land Transport and Shipping (Public Infrastructure Division) or his
representative is the Chairperson of the Committee.
The functions of the PPC are as follows:







assess whether project proposals meet the infrastructure needs of the country.
examine feasibility and cost benefits of infrastructure project proposals.
make recommendations on investment projects for inclusion in the project pipeline.
examine and review specifications.
advise Public Bodies on the appointment of Project Managers.
give clearances on projects whose pre-tender cost estimates exceed the approved cost
estimates.
review the progress of investment projects above Rs100M or any priority project as
instructed.
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The PPC may also defer a request for future consideration or deny a request and
propose possible alternative, if any.
Each Public Body will develop an investment plan comprising a list of projects that
would support the delivery of the output necessary to achieve the goals and
objectives in the strategic plan. This list of projects is an outcome of policies,
programme and sectoral needs of the Government.
The PSIP document is a coherent plan for public sector investment that aligns
Government economic vision with sector policies, corresponding infrastructure
needs and the required funding arrangements. It is a useful guide to policymakers,
development partners, line ministries/public enterprises and the private partners
for informed decisions on those investment projects that can be funded partly or
wholly through public funds, foreign loans/grants and private capital. Once the
project need is established, the funding options for the investment shall be
considered in the following sequence:
 Public Bodies must first determine whether this need can be fully met by the
market and private operators.
 Public Bodies must fully explore the possibilities of executing projects or
delivering public services through one or more of the financing modes
provided for under the PPP legislation, including the PPP Guidance Manual.
The Manual can be accessed at the website of MOFEE (http://mof.gov.mu).
The PPP Unit will provide guidance to Implementing Agencies.
At the beginning of the PPP project cycle the PPP legislation should provide that a
Contracting Authority is obliged to register the project with the PPP Unit where a
Contracting Authority is considering procurement of a project through a PPP
arrangement or where a project is considered to have potential for procurement
through a PPP arrangement. The Contracting Authority must complete a
registration form that is issued by the PPP Unit and the form must be submitted to
the PPP Unit for initial screening of the project against a set of basic minimum
criteria that need to be met before further assessment of procurement by way of PPP
should be conducted.
PPP Guidance Manual
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The existing PPP Guidance Manual was issued by the PPP unit in 2006. The PPP
Manual set out a description of the PPP Concept as well as guidance on how to
approach different activities throughout a PPP project cycle including appointment
of transaction advisors, feasibility study, affordability, value for money, risk
assessment, procurement, expression of interest, request for proposal, award of
project. The PPP Manual provides sound general guidance on these matters but the
capacity to absorb and apply the guidance is weak and there is no institution with
the resources or capacity to lead and drive the PPP process throughout the public
administration system.
According to the PPP Unit, this PPP Guidance Manual has not been relied on by the
Unit to oversee and manage the preparation of the current portfolio of 6 PPP
projects, and the procedures for value for money analysis and for the preparation
and use of the public sector comparator (PSC) are not understood. The PPP
Guidance Manual needs to be updated, but more important is the need to build the
capacity of the key institutions and staff who will be using, relying upon, and
applying the new Manual’s procedures: The PPP Unit, the PPP Committee, the
MOFEE, line ministries, contracting authorities, and public corporations.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
PPP Roles in Mauritius Today As Provided for In PPP Act
General Public PPP
Auditor General No Role
PPP Forum
No Role
All approvals after PPP feasibility phase PPP Project Cycle to Signing
Approves PPP agreement
Cabinet
Central Procurement Board
Evaluation Team
Investors, lenders, operators
Contracting Authority
No role in PPP Act
Role only in PPP Project matters referred by PPP Committee
MOFEE PPP Unit
Advisers
PPP Project Team
Minor role in projects some policy roles
PPP Committee
Figure 4 - PPP Roles & Procedures under Mauritius' Current PPP Framework
The current procedural framework is not specified clearly in terms of who is
responsible for what throughout the PPP project cycle. The role of the PPP unit is
minimal in the PPP Act while the PPP Committee is limited in terms of influence
over projects. There is no statutory role for MOFEE in spite of the importance of
fiscal risk. Contracting Authorities are responsible for carrying out feasibility studies
and fiscal risk is to be examined in these studies. This is inadequate and does not
provide the necessary independence to meet the purpose of having checks and
balances in the PPP project cycle. The Central Procurement Board role in PPP
procurement shows little appreciation for the difference between traditional public
procurement and the process of arriving at a PPP arrangement. There is no role for
the Auditor General in determining whether value for money and risk transfer was
achieved and that there was compliance with all legal requirements and procedures
during the PPP project cycle.
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6.2 Constraints to PPP Preparation & Evaluation
Process:
Factors contributing to the constrained PPP process in Mauritius include:



In practice the PSIP process has operated so that consideration of PPP
potential arises as an after-thought and then only for those projects that
remain without funds after budgetary or donor sources of funding have been
exhausted. Public agencies are requested to consider private sector provision
or PPP as a first option and in completing the Project Request Form should
state if they have considered these options but there is no compelling reason
for agencies to seriously examine PPP potential;.
Almost all contracting authorities (Ministries and other Government
agencies) are not capable of identifying, appraising, developing and
implementing PPP projects but the PPP Act sees them as solely responsible
for these activities. The terms of reference for this review of the legal and
institutional framework stated “most Government entities in Mauritius have
difficulty identifying projects that could be undertaken under PPP
mechanism. Contracting Authorities are not used to formulate projects except
during the budget preparation phase when they identify traditional capital
projects”. The PPP Policy Statement 2003 referred to this lack of capacity
when it provided that the PPP Unit and external advisers should assist
sectors with weak capacity to implement PPP projects. Meetings with
contracting authorities indicate that their capacity to absorb and apply
guidance is weak so that a stronger role is necessary for the PPP Unit to lead
and drive the PPP project cycle.
The PPP Committee’s influence on the PPP project cycle is limited to the
feasibility study phase. In most PPP processes the PPP Committee is at the
core of checking that there is compliance with legislation, procedures and
guidance and that the necessary checks and balances are operating
throughout the PPP process.
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6.3 Recommendations: Design, Draft, and
Disseminate a new Guidance Manual of PPP
procedures
Specific Actions: New PPP Procedures will include:
1. To improve the process for the identification of new PPP projects the head of the PPP
Unit should be appointed to sit on the Projects Plan Committee (PPC).
2. Require that the Debt Management Office in MOFEE should carry out PPP fiscal risk
assessment.
3. Change the Central Procurement Board’s role in PPP procurement with the PPP
Committee operating with an enhanced role and functions.
4. Provide that professional advisers on PPP projects should be advisers to the
Government through the PPP Committee and not advisers to contracting authorities.
Advisers are not engaged to carry out PPP procurement on behalf of contracting
authorities but to continually advise Government on whether PPP procurement
provides better value for money than traditional procurement.
5. Enable the PPP Unit directly to engage advisers on PPP arrangements.
6. Specify clear and certain roles and responsibilities for PPP Unit, PPP Committee,
MOFEE (Debt Management Unit - fiscal risk), contracting authorities, and Cabinet in
PPP Project Cycle and relationships between these entities to streamline approvals,
decision-making and implementation.
7. Annual evaluation review of the PPP procedures is conducted by an outside PPP
institutional specialist to determine if it should be modified and improved.
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Recommended PPP Procedures & Roles
Monitor & Evaluate Process and Outcome
PPP
General Public Decision to carry out PPP feasibility, advertise, accept best proposal
Auditor General
Recommend to Cabinet for 3 decisions, Implement PPP policy and Cabinet decisions, ensure integrity of process, appoint project and evaluation teams, approve advisers
PPP Forum stakeholders and public
Fiscal Risk Analysis,
PPP Regulation
s
Cabinet
MOFEE
PPP Committee
Evaluatio
n Team
Investors, lenders, operators
Led by CA Inception Feasibility and by PPP Unit Procurement Phase
PPP Unit
Advisers
Project Officer PPP Project Team
Process Auditor
Contracting Authority
Figure 5 - Structure of Recommended PPP Procedures and Roles
6.4 Justification & Estimated Benefits of
Implementing the Recommendation:
These recommended changes to the PPP project preparation and evaluation process
will accelerate the PPP project cycle for the following reasons.

Removal of Central Procurement Board from the PPP procurement process will
eliminate a layer of decision-making that is currently constrained by limited experience
with PPP output standards and evaluation criteria;
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





An improved and more robust legal and institutional framework brought about
through the proposed changes in this report can bring certainty and credibility to key
steps of the new process;
A better resourced PPP Unit with ready access to professional advisers will be better
able to manage projects through completion;
The new PPP Unit will be better able lead and drive the process rather than waiting to
be asked to provide advice and assistance;
Improved capability through contracting authorities and PPP Unit in techniques such as
capital appraisal and cost benefit analysis;
The comprehensive suite of Procedures, Guidelines and Instructions, PPP Manual
including template forms and standardised contract provisions and the building of
institutional knowledge and experience will strengthen, streamline and accelerate the
workings of the PPP Project Cycle;
The general public will have more confidence in a transparent and accountable process
that has high standards of disclosure and reporting requirements;
Because of these changes and improvements decision-making will be swifter as
participants in the PPP process, including the private sector investors, operators and
lenders, will be more certain of the process and will have greater confidence in the
higher quality analysis, findings, reports, recommendations and outcomes that the
process produces.
RECOMMENDED LIST OF SPECIFIC PPP PROCEDURES, GUIDELINES OR
INSTRUCTIONS that should be issued under authority of the PPP Act and PPP
Regulations:
1)
capital appraisal and management of projects,
2)
cost benefit analysis of projects,
3)
registration form for registering a project concept note with the PPP
Unit that describes the project and sets out the public private
partnership capability and experience of the Sponsoring State
Authority,
4)
procurement of advisers on matters relating to PPP arrangements
including the formation of panels of advisers that are technically
qualified that compete on the basis of financial proposals for adviser
assignments,
5)
procurement of a project by way of a PPP arrangement including
instructions for publication of invitations to participate in a PPP
arrangement, competitive tender procedures, terms and conditions
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6)
7)
8)
9)
10)
11)
12)
13)
14)
15)
16)
17)
18)
19)
20)
21)
22)
23)
24)
25)
26)
27)
28)
29)
30)
and tender documents, evaluation of proposals to be a partner in a PPP
arrangement, permissible dialogue with bidders, negotiations with
potential partners prior to submission of final proposals and the
process for finalising agreements,
unsolicited proposals and the PPP Project Cycle,
exceptions to competitive tender for procurement of a project,
model sample documents for PPP procurement,
compendium of sample legal terms and conditions and standard
commercial principles for PPP arrangements and model sample
agreements,
PPP Pre-feasibility Study,
PPP Feasibility Study,
factors and criteria for decisions on proposals and projects to be
admitted and continued in PPP Project Cycle,
affordability of a project by a State Authority, Government and users,
value for money in PPP arrangements,
risk identification, analysis, assessment, allocation, transfer and ongoing risk management,
public sector comparator benchmark for cost of a project procured by
traditional public procurement,
discount rate for project investment,
fiscal risk assessment and management,
whole of life costing of a project,
output specification for a project,
user fees and shadow tolls,
role of PPP project officer in a State Authority,
role of PPP project team in the feasibility and procurement phases of
the PPP Project Cycle,
role of PPP process auditor and probity,
economic, social, environment and other forms of regulation and PPP
arrangements,
stakeholder analysis and consultation,
supports for PPP including project development, guarantee funds,
infrastructure funds
risk data base for PPP arrangements,
cost data base for PPP arrangements,
financing, insurance and re-financing PPP arrangements,
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31)
32)
33)
34)
35)
36)
37)
38)
39)
40)
contract management in implementation and operation of a PPP
arrangement,
project review and monitoring of PPP arrangement,
PPP programme monitoring,
taxation and PPP arrangements,
accounting and PPP arrangements including national accounts
treatment,
public access to information and disclosure of PPP arrangements,
audit of PPP arrangements,
audit of PPP procurement,
appeals against decisions taken during the PPP Project Cycle,
other matters that the Chief Executive Officer considers necessary for
implementation of the PPP Project Cycle or the purposes of the Act
Monitoring of Actions: The PPP Unit’s progress and completion of this PPP
procedures activity will be monitored by the PPP Committee and by MOFEE
Finance Secretary. The PPP Unit will monitor the consultants it has engaged to
support drafting of the PPP procedures.
Required Resources:
1. Direct the existing resources at PPP Unit, the PPP Committee, the MOFEE’s Finance
Secretary, the Cabinet, and other stakeholders to coordinate and oversee the above tasks.
2. As recommended in Section 5.1 above (Design and Organization of the PPP Unit), the
PPP Unit should hire a full-time PPP Framework Development & Capacity-Building
Manager. It is also recommended that the PPP Unit hire a Resident PPP Adviser to
oversee the identification and completion of more PPP projects. A full copy of the Terms of
Reference for recruiting and hiring these specialists individual is included in Annexes A and B of
the Report. Together these two specialists will provide the bulk of the human resources
required to coordinate and manage this PPP Guidance Manual activity. The Resident
PPP Adviser will ensure that the content of the Manual addresses the practical
requirements of completing PPP transactions in Mauritius, while the PPP Framework
Manager will ensure that it is consistent with the rest of Mauritius’ PPP legal and
institutional framework.
3. The PPP Unit should be supported in completing this activity by the dedicated effort or
an experienced PPP specialist who can focus on the drafting and refinement of this PPP
Guidance Manual, while being overseen by the PPP Unit’s Resident Adviser and
Framework Manager. The estimated level of effort of these consultants to complete this
one activity is:
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o
PPP Guidance Manual/Toolkit Specialist = 60 days
S.M.A.R.T Analysis of Recommended Activity:
Recommendation: Design, Draft, Approve, and Disseminate a new Guidance Manual of PPP
procedures
Specificity: How is it Specific?
This will consist of the completion of a specific document (Manual)
that will be reviewed and agreed to by the Government of Mauritius,
which inputs and consultations from the private sector
Measurable: How will it be
Measured?
Successful completion of this activity can be clearly measured by
three discrete steps:
o
Completion of design & draft of the Manual
o
Review & Approval of Manual by MOFEE & PPP Committee
o
Dissemination of Manual by PPP Unit & training on its
usage
Achievable: Is the task
achievable, and what does
Achievement look like?
Before the design and drafting of an effective PPP Guidance Manual
can begin, the powers, functions, and duties of the PPP Unit and the
required process for implementing PPP in Mauritius must first be
established by the completion of the PPP Policy Statement, the PPP
Law & Regulations. Without this foundation, this task should not be
initiated. Once the PPP Policy and revised Law & Regulations are
adopted, the completion of the Manual will not be difficult to
achieve. Specific procedures for it address have already been
identified in this Report. It will be important that this activity does
not end with the approval of the Manual by Government. The PPP
Unit must ensure that it both disseminates and trains line ministries
on its usage in order for the objectives of this task to be achieved.
Relevance: Why is it Relevant
to the overall
program/strategy/goals?
Currently there is confusion both within Government as well as within
the private sector about the process by which PPPs get implemented
in Mauritius. The PPP Unit does not use the current PPP Guidance
Manual that was drafted for it in 2006. The revised framework for
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Recommendation: Design, Draft, Approve, and Disseminate a new Guidance Manual of PPP
procedures
PPPs in Mauritius must provide a clearer and more efficient process
for implementing PPPs in Mauritius, if it is to be effective. This
Manual will provide the specific, foundational instrument for
achieving this.
Timeliness: By when will be
achieved?
The design, and drafting of the PPP Manual should commence after
the revised PPP Act & Regulations have been passed. This may
therefore require more time to achieve, as it is dependent upon the
availability and willingness of the National Assembly to pass the Act.
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Timing of Activity:
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8. Action Plan for Establishing a
Panel of PPP Experts
Summary of Recommended Action Plan for Establishing the Panel of
PPP Experts




PPP transaction advisors play a crucial role in helping Mauritius’ contracting authorities prepare and
complete PPPs, however the 6 months required to procure and retain these advisors is a significant
constraint.
Several other governments including India, Puerto Rico, and others have addressed this through
establishing a Panel of pre-qualified PPP experts to improve both the quality and speed of retaining
needed PPP expertise
A recommended design and action plan has been provided for launching a Panel of PPP Experts for
Mauritius which includes:
a. Organizational Structure
b. Outline of PPP Panel Request for Qualifications (RfQ) Document
c. Operational Guide for the PPP Panel
In addition a terms of reference is also provided for retaining a short-term Procurement Specialist to
assist the PPP Unit with completing the launch of the PPP Panel including: Drafting the PPP Panel RfQ
Document, Drafting the PPP Panel Operational Guide, Designing the PPP Panel marketing & promotion
Plan, Implementing the tasks of the marketing & promotion plan, and evaluating qualifications.
7.1 Rationale & Objectives for a Panel of PPP
Experts:
The current framework for PPPs in Mauritius, as articulated by both the PPP Policy
Statement of 2003 and also the PPP Act of 2004 (amended), features an important role to be
played by PPP transaction advisors. This approach is consistent with international best
practices. Countries like the United Kingdom, South Africa, Australia and others that have
been implementing PPPs for well-over a decade also utilize outside PPP advisors to both
complete PPP feasibility analyses as well as to conduct and manage PPP tenders for the
following reasons:
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


Many PPP transactions require specialized technical, financial, and legal experience and
skills that line ministries, contracting authorities, and public corporations cannot
provide internally.
The workloads required to complete PPP feasibility studies and to successfully
conclude transactions tend to be “lumpy,” requiring high levels of specialized efforts
within a short-period of time
PPP feasibility study and transaction advisory contracts terms and conditions are
usually structured to incentivize successful and timely completion. For large and
complex PPP projects where numerous, challenging decisions about project risk-sharing
structures, and clarifications about specific output standards of performance are
needed, delays can often be encountered. Effective transaction advisory contracts,
however, can help ensure that such delays are minimized.
Following these practices, the Government of Mauritius has already hired PPP
transaction advisors to support the implementation of its current portfolio of six
pilot PPP projects. 4 However, in Mauritius, as in most countries, the process of
procurement these advisors currently requires a significant amount of time, adding
months to the PPP project development cycle. The record of the current portfolio of
6 pilot PPP projects being prepared in Mauritius has shown that it takes up to 6
months or more to complete the entire procurement process for the advisory
services. These steps include:
1. Preparing a Request for Proposal (RfP) document for PPP advisors, which includes:
background information on the given project, the terms of reference the advisors should
fulfil, instructions for how bidders should prepare their proposals, a draft version of the
advisory services contract, and other relevant information.
2. Advertising the PPP advisory services opportunity, receiving expressions of interest,
and sending the RfP to interested firms.
3. Responding to questions and requests for clarifications from interested bidders on the
bid documents and instructions.
4. Receiving and evaluating proposals, and selecting the preferred bidder.
5. Announcing the winner, finalizing and signing the advisory services contract, and
having the advisors commence work.
The time required to complete the procurement process has contributed to the
widely-shared belief within the public sector that PPPs are not an attractive an
4
As noted previously, these six PPP projects include: The Highlands modern town project of the State Land
Dev. Co.; The Rose Hill Integrated Mixed-Use Facility; The Port Louis Ring Road & Harbour Bridge Tolling
System; The Bigara Curepipe 25 MW Windpark Project; The Mahebourg Waterfront Development Project
(Phase 2); The Curepipe Integrated Mixed-Use Facility Project
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option for implementing priority infrastructure projects in Mauritius. The PPP Unit,
the Finance Secretary of the MOFEE, and the PPP Committee have all identified this
issue as an important constraint to PPPs in Mauritius, and one that they explicitly
want addressed through the establishment of a new Panel of PPP Experts.
7.2 Lessons Learned from International
Experiences with Establishing Panels of PPP
Advisers:
Internationally, some governments have addressed this similar PPP advisory
services procurement issue through approaches including:
1. Streamlining the process of hiring PPP advisors, by developing standardised RfPs for
PPP transaction advisory assignments, standardised terms of reference, and
standardised PPP advisory services contracts, as well as sponsoring conferences and
other promotion initiatives to generate interest by potential PPP advisory firms in
rapidly bidding on PPP advisory assignments.
2. Establishing a formal process to pre-qualify a limited number of firms (also referred to
as a “Panel”) to provide these PPP advisory services, and then engaging in a muchshortened procurement process to select PPP advisor for each specific project or need
Example: India’s Panel of Pre-Qualified PPP Transaction Advisors
Since 2001 the Federal Government of India has established a detailed legal and
institutional framework for PPPs. The Government of India has had high
expectations from PPPs and has projected that of the $150 billion (US Dollars) of
new infrastructure investments needed throughout the country during its 2005-2010
period, an estimated $60 to $65 billion (some 40% – 43%) would need to come from
the private sector.5 There are several key elements that have been established as part
of India’s new policy, legal, and institutional framework for PPPs, including its
viability gap funding (VGF) mechanism, its model concession agreements, and its
5
Source: India’s Federal Ministry of Finance, Department of Economic Affairs
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model PPP tender documents.6 Given the enormous scope of the Indian market’s
demand for new PPP investments, it was clear that it would need an effective
mechanism for engaging a large number of qualified PPP transaction advisors in a
timely manner.
In 2007 the Federal Government of India established a Panel of Pre-Qualified PPP
Transaction Advisers. In India’s case, a large number of State Governments as well
as State-level, Municipal-level, and Federal-level public infrastructure agencies had
requested help from the Federal Ministry of Finance, Dept. of Economic Affairs’ PPP
Cell to assist them with the process of selecting experienced and qualified
transaction advisors. Most such public sector agencies had limited knowledge of
PPPs, where not able to prepare the scopes of work for the PPP advisory services
they were seeking, and did not know how to evaluate the qualifications of interested
bidders for these services.
The purpose of India’s Panel is to both improve the quality of the PPP transaction
advisory services that State Governments and public infrastructure agencies receive
as well as to minimize the time required to complete the process. Specifically, this
has included:



Streamlining the tendering process for the engagement of Transaction Advisers for PPP;
Enabling fast access to firms that have been pre-qualified against relevant criteria;
Ensuring transparency and accountability through clear definition of the process and
the role and responsibilities of the agencies and the private sector.7
In setting up the Panel, the Government has assessed the qualifications submitted by
interested firms and has accepted only those that were evaluated as being the most
qualified. This differs from an approach of pre-qualifying all firms who pass a
minimum standard. The Panel was designed to be used for undertaking medium6
Key elements of India’s PPP Framework have included: Scheme for Support of PPPs in Infrastructure (Policy
Statement), Establishing the Viability Gap Funding (VGF) mechanism, Establishing the Infrastructure
Development Finance Company (IDFC), Model Concession Agreements (MCAs) for Roads, Ports, and Other
Sectors, Model PPP Bidding Documents, including Model Requests for Qualifications (RfQ) and Model Request
for Proposals (RfPs), A PPP Handbook of guidelines and templates to follow in implementing PPPs.
7
See Panel of Transaction Advisors for PPP Projects: A Guide to the Use of the Panel, by the Government of
India, Ministry of Finance, Department of Economic Affairs,
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sized PPP projects. For large infrastructure projects with an investment value of
more than 2.5 billion Indian Rupees or more (about $55 million U.S. Dollars), such as
construction of a new port or airport, PPP transaction advisory services in India
should be tendered for openly. The firms that are on the Panel are qualified to
provide PPP financial and legal transaction management services. The technical and
sector-specific PPP transaction advisor must still be tendered for separately by the
client Government agenices.
The Panel was designed to be used for PPP tendering and transactions management
services, and not for conducting PPP project feasibility studies. Moreover, it was
only to be used for PPPs featuring long-term private capital investments. Therefore
projects featuring private sector operating contracts, service contracts, or leases
would not qualify.
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Summary of the steps in using the India’s Panel of PPP Transaction Advisors:
a.
b.
c.
d.
e.
f.
g.
h.
Confirm that the project is eligible as a PPP to use the Panel
Develop the terms of reference for the transaction advisory assignment, containing:
 Letter of Invitation
 Information for consultants regarding submission of proposal
 Terms of Reference, including the following tasks:
o Conduct formal sounding of private sector market interest
o Confirm scope, timing, & risk-structure of project
o Prepare bid documents (RFP & Draft Contract, etc.)
o Prepare supporting documents for bidders
o Respond to requests to clarify & change bid docs
o Prepare bid evaluation criteria & support bid evaluation process
o Assist with any Best-and-Final-Offer discussions
o Monitor fulfillment of conditions precedent
o Overall management of team and transaction to successful completion
 List of key positions whose CVs and experience would be evaluated
 Standard formats for the financial proposal
 Proposed contract terms
 Procedures to be followed for review of the progress of the work and review of
final documents
Determine which Panel members to approach (a minimum of five should be approached)
Seek financial quotes from the invited members of the Panel
Public sector body evaluates the proposals
Sign contract with the selected private firm/consortium to provide transaction advisory services
Transaction advisory services commence
Public sector body reports to the Federal Ministry of Finance’s Dept. of Economic Affairs (PPP
Cell) on the performance of the transaction advisor.
While the Panel was established by the Federal Government, India’s many different
State Governments, Municipal Governments, and public sector infrastructure
agencies were not required to use it. For the Government of India, establishing and
managing such a Panel was clearly conducted as a pilot project from which
important practical lessons would be learned. For this reason it was first set up to
last just two years, during which the MOF DEA’s PPP Cell would monitor its
performance and results. The PPP Cell reserved the right to change the Panel
during this period. Private firms and consortia that were qualified to be on the Panel
were selected based on there general capabilities to provide PPP commercial,
financial, and legal transactions management experience, rather than on their sectorspecific experience (such as in urban waste management, water, public transport,
ports, airports, highways, education, health care, etc.)
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Example: South Africa’s Experience with Streamlining of the
Procurement and Management of PPP Transaction Advisors:
A significant part of South Africa’s PPP framework, including its PPP Manual, its
Standardised PPP Contract Provisions, and many of its PPP education and outreach
activities are dedicated to the goal of streamlining the process of hiring and
managing PPP transaction advisors. South Africa, however, does not have a panel or
a short-list of PPP transaction advisors that are already pre-qualified. It did have a
temporary short-list of qualified legal advisers for PPPs, but the PPP Unit later
discontinued this practice. PPP transaction advisory contracts are openly tendered
for. Based on the South African example, one option for the Government of
Mauritius to consider is to focus on streamlining the current system for hiring PPP
transaction advisors through greater awareness and standardization.
One goal of the Mauritius PPP framework should be to try to create a local
marketplace of qualified PPP transaction advisors. This would likely need to begin
with relatively smaller & medium-sized PPP projects. India’s Panel of PPP advisors
was established for medium-sized PPP projects (investments of less than $55 million
USD), and larger projects were expected to undergo full and open competition for
their transaction advisory services.
Example: Puerto Rico’s Establishment of a Roster of Pre-Qualified of
PPP Experts
Puerto Rico is a territory of the United States, an island with some 2 Million
inhabitants, in the middle of the Caribbean Sea. Although it is part of the United
States, the island has autonomy over its economic and political governance, and is
an important agricultural, tourism, banking services, and export-led economy.
However, like Mauritius, Puerto Rico's growth and expansion is challenged by its
lack of competitive infrastructure. From energy, water, solid waste, to transport,
Puerto Rico has identified some $1.0 Billion in infrastructure investments that are
needed, it has recently launched a PPP strategy and framework to help meet this
need.
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In 2009, the Government of Puerto Rico established the Agency for Public-Private
Partnerships, with the mandate to coordinate the overall effort to plan and
implement multi-sectoral PPP transactions using a structured, organized, and
transparent process. One of the first actions the new Agency took upon its
establishment was the creation of a panel-like body of PPP specialists, in this case, a
"Roster of Pre-Qualified" experts that that the Agency can draw upon to engage, on
a short or long-term basis, qualified PPP consultants from a variety of fields. Like in
the previous examples, the objective was to establish a roster of pre-qualified
experts, operating with pre-negotiated base contracts, in order to streamline the
process of preparing and implementing a growing pipeline of viable PPP projects.
The PPP Agency prepared its Request for Qualification Document, and with the
help of a consultant, marketed the document to as many qualified local and
international firms to submit bids. 8 The result was that over 300 qualified firms
submitted their PPP qualifications, generating substantial interest in the Puerto
Rican PPP program among the marketplace of PPP advisors and investors. Each
firm paid a $100 fee to receive the RfQ document. This long list was narrowed down
to approximately 20 firms that are now on the "Roster of Qualified PPP Firms". Now
in place, the Agency will identify various firms, depending on the nature of each
PPP transaction, and request proposals using a RFP format against the master base
contract. The RFPs will lead to Task Orders, in which the firm will negotiate a firm
budget based upon an agreed upon scope of work.
Other Examples of Panels & Pre-Qualified Short-lists of PPP
Transaction Advisors:
There are several other examples of Governments that similarly sought to expedite
the process of engaging PPP transaction advisors by establishing short-lists of prequalified firms and consortia. Some examples of these have included:

Dade County Government, Florida – has established a group of pre-qualified firms to
provide PPP transaction advisory services
8
For the Puerto Rico PPP Authority see http://www.app.gobierno.pr/Index_eng.html , for the Request for
Qualifications for PPP advisory services, see
http://www.app.gobierno.pr/Documents/PuertoRicoP3RFQAdvisoryServices-Oct-05-09-FINALFINAL.pdf
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
The City Government of Warsaw, Poland has recently established a list of qualified PPP
transaction advisors for its forthcoming PPP projects
7.3 Recommended Organizational Structure for a
Panel of PPP Experts for Mauritius
Different approaches can be taken to the appointment of professional, transaction
advisers for different types of assignments in the PPP project cycle. For large
projects or specialized, complex assignments PPP advisers should be chosen on the
basis of an open international competition. For what are considered to be small or
medium-sized projects, or less complex assignments, restricted bidding can be
considered either on the basis of fees and costs quotation alone, or on a combination
of fees and cost quotation and assessment of strengths to carry out a particular
assignment. A Panel of pre-qualified legal and financial advisers should be formed
to provide services. Technical advisers should be chosen on the basis of specialized
skills and experience relevant to an individual project. In choosing advisers, prior
PPP experience is crucial as well as the required professional skills.
Complying with Current Public Procurement Legislation in Mauritius:
The Public Procurement Act 2006 and Public Procurement Regulations 2008 permits
restricted bidding for goods, other services and works but not for consultancy
services (see Sections 15(1)(a)(ii) and 19 of the Act and Regulation 41 included as
Appendices 1 and 2 at the end of this Response Document). Regulation 42 provides
for the establishment and management of a standing list for use in restricted
bidding. The Act provides that the standing list can be amended at any time – it is
not a list that is closed for a specified time. To empanel pre-qualified consultants, such as
for PPP feasibility studies and transaction advisory services, the Public Procurement Act
would need to be amended.
However, the MOFEE could decide to pursue the course of making the PPP Unit an
exempt organisation from the provisions of the Public Procurement Act. Currently,
the only body that is an exempt organisation listed in the First Schedule of the PPP
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Regulation is the Independent Commission Against Corruption. Moreover, this
“exempt organisation” route to permitting restricted bidding among pre-qualified
consultants would mean that the PPP Unit, and not the line Ministry or agency that
is the entity proposing a project for PPP, would engage the PPP consultants and
transaction advisors. If the PPP Unit is to be re-designated as an exempt
organization it would be necessary for its procurement procedures to meet the
fairness, accountability, transparency and efficiency tests of a good public
procurement system. The decision approving the appointment of advisers would be
taken by the PPP Committee9, and not by the PPP Unit.
Creating the Panel of Pre-qualified PPP Advisers
The panel of advisers should be formed to advise and assist on the preparation of
projects under “indefinite delivery contracts” or “framework agreements” between
the PPP Unit and the empanelled firms. Under this form of contract individual
consultants, firms, or consortia of firms are pre-selected and retained for an
indefinite period, e.g. up to 2 years, to provide advice on a specific PPP activity, the
extent and timing of which cannot be defined in advance. These contracts are most
appropriate when:
(i)
(ii)
The services are required urgently and a lengthy tendering process is
impossible, and
Each individual assignment is relatively small in value, making an
expensive selection process inefficient, although when added together, the
overall requirement for advice is likely to be substantial.
The services required by the PPP Unit will be broad and require commercial PPP
structuring, financial, technical, legal, environmental, and social safeguard expertise
9
Permanent Secretary MOFEE, Finance Secretary, MOFEE, Permanent Secretary, Ministry of
Infrastructure, Permanent Secretary, Ministry of Public Utilities, Permanent Secretary, State Law Office,
Chief Executive of the PPP Unit attends PPP Committee but is not a member.
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to provide support in PPP project structuring and bid process management. More
specifically, these tasks for which PPP experts would be needed would include:
i)
ii)
iii)
iv)
v)
vi)
vii)
viii)
ix)
Screening candidate PPP projects, and preparing PPP project
concept papers,
Producing Technical verification and output parameter definition,
Conducting PPP institutional analysis,
Investment financial modeling and sensitivity analysis
Conducting social and environmental impact assessment,
Developing PPP project risk-allocation structures and options,
Designing and drafting PPP agreements and contracts
Preparing PPP bidding documentation and
Managing PPP bidding processes and supporting the PPP Unit and
line ministries through to financial closure of the transaction
Empanelled firms may also look at requisite arrangements with other specialist
partners. Specialist technical advice related to the individual sector concerned can be
separately procured.
The process of establishing and using the Panel should be tailored to the specific
PPP process and project cycle that is being adopted in Mauritius and much would
depend on the legal status and official functions, powers, and duties that the
Government decides to assign to the PPP Unit. As recommended earlier, the legal
status and institutional role of the PPP Unit should be as the clear leader and driver
of the PPP process. Moreover it needs the authority to enter to enter into its own
contracts for such advisory services. The final structure of Panel should also reflect if
funds are available to the PPP Unit for developing and preparing PPP projects.
Discussion would also be required on the value, complexity, nature and type of
assignment that would be considered suited to using restricted bidding through a
panel of pre-qualified advisers in Mauritius.
Other structural issues that must be addressed include whether the panel should be
formed for a set time period or if additions or removals of advisers can take place at
any time. This Action Plan recommends shortlisting approximately 5 consortia and
or individual firms, both local and international, for a variety of skills required
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including technical (engineering), financial and economic, legal, social,
environmental, and sector specific. This will allows the Government the greatest
flexibility and choice in the utilization of the roster of experts. It is then
recommended to "rotate" advisors every 2 years, by allowing new firms to submit
new proposals in order to refresh the list of advisors.
7.4 ACTION PLAN to Establish a PPP Panel of
Experts: Key Steps
Step 1: Prepare a Draft RFQ and Develop a Marketing Plan
The Key First Step, once the Action Plan for the Panel has been approved, and the
legality of the creation of the Panel has been satisfied, is the development of the
Request for Qualifications (RFQ) Documents as well as marketing plan to generate
interest in the bidders both locally and internationally. The GOM should prepare the
RFQ as well as a marketing plan to generate significant response to the RFQ in the
local and international consulting markets. The following is a recommended
detailed outline for the RFQ with comments in the major sections on what content,
at a minimum, should be included to promote clarity and responsiveness in the
proposals.
Outline for the Request for Qualifications (RfQ) for a Panel of PPP
Experts:
A. Cover Letter and Introduction
B. The GOM Policy Objectives and Parameters for PPP in Mauritius
This should include specific definitions of PPP, what is eligible under the current
legal framework, a summary of the policy, a summary of the legal parameters of the
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PPP program, and a description of the GOM priorities and long term objectives
regarding PPP and economic growth and development.
C. Goal and Purpose of the PPP Panel of Experts
This section should include a description of the GOM "vision" for establishing a
Panel of Experts and how this will operate within the general structure of managing
the PPP Unit and overall PPP program. It should clearly and concisely define the
purpose of this RFQ and the role and responsibility of the Panel.
D. Defining Eligible Consultants and Experts
This section should define what consultants are eligible and why the GOM is
interested in receiving proposals in different categories such as technical, financial
and economic, environmental, etc., It should also define if firms can submit
proposals for more than one category or if large consortia of firms are allowed.
Moreover, it should define if firms can appear on more than one proposal.
E. Description of the Nature of the "Indefinite Quantity Contract"
This section should describe how the Panel will work, and the type of services that are
envisioned. It should also clearly define the categories of submissions for qualifications
including:






Technical (Engineering)
Financial and Economic (Transactions and Feasibility Studies)
Procurement Services
Legal Services
Environmental Services
Social and Other Services
Lastly, this section should include a definition of how the "Indefinite Quantity
Contract" will work, i.e. a master contract will be executed, and limited competition
for Task Orders will take place on a case-by-case basis.
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Step 3: Establishing the Operational Guide for the PPP Panel of Experts
This section describes the outline for the Operational Guide for the Panel. This
Guide should be distributed together with the RfQ document:
A. Defining the Process of Establishing the List
This section describes the process of setting up the Panel and list of advisors. It
should include language on how many firms will be shortlisted (no more than X)
B. Defining the Evaluation Criteria
This section describes the evaluation criteria and what the weighted criteria are
between qualifications, previous PPP experience, proposed Project Manager and
illustrative personnel, Africa regional and Mauritius experience, and other criteria.
C. Describing the Evaluation and Review Process
This section describes the review process, how bids will be evaluated, how reference
checks will be made, and how additional material or information may be requested.
D. Defining the Process of Award and the "Re-submittal Phase"
This section describes the award process, how many firms will be shortlisted and
defines the rationale and process of allowing "re-submittal" or new submittal
periods, where every 12 months the Panel will allow new participants based on a
need to add additional capabilities and to provide firms from both local and
international markets an annual opportunity to make the list.
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E. Managing the Panel of Experts and Defining "Base Contracts"
This section describes how the short listed firms will be given opportunities to
submit proposals, learn about upcoming projects, work with the GOM on the PPP
program, and how the GOM expects to enter into "Base Contracts" which represent a
recognition that the firm is on the Panel but that it is only a "base contract" for the
opportunity to submit "task order" proposals. This limited exclusivity gives both the
firm and the GOM a commercial commitment without any financial obligation until
Task Orders are awarded on a project-by-project basis.
F. Issuing of Task Orders and Types of Assignments Required
This section describes the various types of assignments that are anticipated under
individual Task Orders. As much as possible, it is advisable to describe types of
assignments such as:







PPP Options Analysis
Technical Analysis
PPP Financial Analysis
PPP Business Case and Proposed Risk Allocation Structure
PPP Procurement
PPP Legal and Contracting
Environmental Analysis
Specific examples of PPP assignments anticipated in the next 12-24 months under
the GOM PPP Program should be summarized.
G. Procuring Task Orders
This section should describe the process of procuring Task Orders including a
description of the typical RFP, as well as the GOM intention to invited limited or
unlimited bidders under the Panel submit proposals.
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H. Cost Information and Proposals
This section should describe why Cost information at the RFQ stage is not required
but should describe the process for Cost proposals at the Task Order RFP stage.
Information regarding fixed price contracts or fixed daily rates should also be
discussed. General details of the importance of cost proposals i.e. percentage of
weighting need not be discussed at this time.
I. RFQ Proposal Instructions
This section gives detailed instructions to bidders to help them comply with the
terms of the RFQ and to help the GOM evaluate bids like-to like.
J. Defining Minimum Qualifications for Proposals
This section describes the precise instructions for submitting relevant qualifications,
how and in what format, as well as information on minimum standards and
experience both internationally and locally. It is also recommended to define how
qualifications are submitted along with references provided. Clear instruction and
page limits are needed.
K. Proposed PPP Panel of Experts Project Manager
This section describes the qualifications and minimum experience of the Bidders
Proposed Project Manager. Each firm should be required to identify their Project
Manager that is experienced in PPP and indicative of the type of skills the firms are
willing to dedicate to the Panel, without financial obligation of either party.
Preference should be given to full-time corporate staff.
L. Mandatory Requirements and Use of Local Experts
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This section should describe the importance of using local firms, as well as specify
that at least 15% preference will be given to firms that include local firms. It should
also be noted that at least 25% of all short-listed firm will include locals or establish a
special "place" on the panel for all local firm and let them compete and be free to join
other firms on individual Task Order opportunities to foster local firm development
and greater utilization of local firms.
M. Submission Requirements and Inquiries
This should include details on timing, communications, and compliance.
N. Bidders Conference
This section should include a description of a Bidders Conference to be held in
Mauritius. The one day bidders conference and registration information should be
made available to all bidders where the GOM can discuss the Panel, the PPP
program, and Task Order and Project opportunities. This will also serve to generate
opportunities and interest for investors of actual transactions and will be a chance to
"showcase" the GOM PPP program.
O. RFQ Terms and Conditions: Reservation of GOM Rights
This section simply explains the GOM rights to revise or cancel this opportunity
without any obligation. This provides important protection to the GOM in the event
of changes in circumstances that could lead the GOM to this decision.
P. Defining "Best Interest of GOM"
This section defines what is and is not in the best interest of the GOM regarding the
RFQ.
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Q. Cost of Preparation of Proposals
Simply states the cost of all proposals are explicitly the responsibility of each offeror
and that the GOM will not be responsible for any proposal costs.
R. Confidentiality Clause
Explains that all bidders information submitted will remain confidential.
S. RFQ Disclosure and Conflict of Interest
Defines what disclosure the GOM has the responsibility to provide as well as the
bidders responsibility to disclose business and financial information as required.
T. Transparency and Liability
This section defines the bidding process and transparency objectives but also
reserves the right for the GOM to conduct business within the parameters of "best
interest of the GOM" without liability.
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Step 4: Issuing the Announcement for Interested firms to Request the
RfQ:
A Sample Request for Qualifications (RfQ) for Appointment of Panel of Legal Advisers to the PPP Unit:
The Government of Mauritius’ Public Private Partnership Unit (the “PPP Unit”) has a requirement, from
time to time, to draw on the services of experienced, professional legal advisers on public private
partnership arrangements. The PPP Unit is creating a panel of pre-qualified legal advisers from which it
will [appoint an adviser] [from which it will choose three entities to bid for work] on individual
assignments or groups of assignments. The legal advisers will be required to advise and assist the PPP Unit
with:




Legal Due Diligence Investigations of projects and participants;
PPP Project documents;
Draft PPP agreements in accordance with Standardised PPP Provisions, and
Legal advice throughout the PPP project cycle from inception of a project to completion.
Experience and skills required includes:
o Drafting and negotiating project finance and PPP agreements;
o Drafting and negotiating corporate finance PPP agreements;
o Knowledge of Mauritius PPP Procedures and Standardised PPP provisions;
o Experience in risk assessment, allocation and quantification in PPPs;
o Experience in dealing with Government and private sector interface;
o Knowledge of the PPP legal and institutional framework including guidance, procedures,
instructions;
o Knowledge or access to knowledge of Mauritian law;
o Ability to deliver specified high quality outputs on time.
Bids will be evaluated on the basis of the criteria set out in the Request for Qualifications (which would
be provided to interested persons).
The following is a draft of an advertisement for seeking legal advisers to be
empanelled to provide PPP advice. This can be adapted so that combined legal and
financial expertise can be created.
Step 5: Receiving and Evaluating Submitted PPP Qualifications
PPP Qualifications from firms / consortia seeking to be empanelled should be
evaluated on criteria which might include [The recommended weightings included
illustrate the relative priority of specific qualifications. These can be further
modified during the launching of this PPP Panel]:
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






Experience in PPP structuring (25%),
Experience in infrastructure advisory (15%),
Relevant sector experience (15%),
Ability to tender advice on all identified aspects (15%),
Management size and experience (15%),
Size of PPP projects structured (10%), and
Mauritian PPP exposure and experience (5%).
Because the Panel will have members that combine financial and legal expertise in a
consortium other factors such should be considered, including:



Interaction with the private market,
Ability to conduct formal market soundings, and
Ability to structure the scope, timing and packaging of a PPP transaction.
If a PPP adviser is being appointed for the procurement phase, the panel should
require that have members have:
o Direct experience in the preparation of key bid documents including
Request for Proposals (RFPs) and contracts and agreements for PPP
arrangements,
o Managing and responding to requests for clarification,
o Preparing proposal evaluation plans,
o Ability to assist with evaluation of PPP bids and preparation of bid
evaluation reports,
o Assisting with negotiations with one or more parties prior to contract
award, and
o Monitoring and advice on bidder performance against any conditions
precedent to financial close.
Required Resources:
1. As recommended in Section 5.1 above (Design and Organization of the PPP Unit),
the PPP Unit should hire a full-time PPP Framework Development & CapacityBuilding Manager. This Manager would oversee the Activity of launching and
sustaining this PPP Panel.
2. It is also recommended that the PPP Unit hire a Resident PPP Adviser to oversee
the identification and completion of more PPP projects. A full copy of the Terms of
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Reference for recruiting and hiring these specialists individual is included in Annexes A
and B of the Report. The Resident PPP Adviser will ensure that the technical content
of expertise called-for by under the Panel meets the needs of the individual PPP
projects. This includes writing the terms of reference for each task order issued
under the Panel. The PPP Framework Manager will ensure that the panel’s design
and operations are consistent with the rest of Mauritius’ PPP legal and institutional
framework and procedures.
3. Because the launching of the PPP Panel would require significant effort during a
period of a couple months, it is unlikely that either the PPP Framework Manager
or the PPP Resident Advisor could complete it all without outside assistance. If
they did attempt this without outside assistance, it would likely preclude their
availability for other important Activities of the PPP Unit. Additionally, the
launching of this Panel will require important skills and experience in marketing
and business promotion. It is recommended that a short-term consultant be
retained to support the launching of this Panel. Specific responsibilities of the
Short-Term Consultant would include:
 Complete the drafting of the Request for Qualifications (RfQ)
document for the Panel.
 Complete the drafting of the Operational Guide for the Panel.
 Draft the Marketing Plan for launching the Panel.
 Implement the Marketing Plan:
 Receiving and Evaluating Submitted Qualifications:
A full copy of the recommended Terms of Reference for this short-term consultant is
included in Appendix J below.
o Short-term Procurement & PPP Specialist = 40 days
S.M.A.R.T Analysis of Recommended Activity:
Recommendation: Establish a Panel of PPP Experts
Specificity: How is it Specific?
The Action Plan provided above describes the specific scope and
requirements for both launching and for operating and managing a
Panel of PPP Experts for a term of 12-months.
Measurable: How will it be
Measured?
Successful completion of this activity can be clearly measured by four
discrete steps:
o
Confirmation of the legality of pre-qualifying PPP
advisers by the PPP Unit
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Recommendation: Establish a Panel of PPP Experts
o
Completion and distribution of the Panel RfQ and Guide
o
Evaluation of submitted qualifications and naming of the
members of the Panel
o
Operation of the Panel through the issuance of Task
Orders and engagement of PPP specialists
Achievable: Is the task
achievable, and what does
Achievement look like?
The above Action Plan and recommended outline for the key
governing documents of the Panel (the RfQ and the Panel’s
Operational Guide) indicate that the these steps are indeed
achievable. However, before these should be undertaken, the
legality of the PPP Unit’s ability to pre-qualify firms for advisory
services must first be confirmed. Either the PPP Unit will need to be
declared and exempt organization under the Public Procurement Act,
or the Public Procurement Act will need to be amended.
Relevance: Why is it Relevant
to the overall
program/strategy/goals?
The launching of the Panel could significantly shorten the amount of
time required to engage PPP advisors from the current period of up
to 6 months down to a period of approximately 2 months. Moreover,
the Panel can better ensure the quality of advisors that are engaged
to work on PPP projects.
Timeliness: By when will be
achieved?
The finalization of the Panel’s key documents, their issuance, and
receipt and evaluation of qualifications could be completed within
approximately 3 months. However, before these steps should be
undertaken, first the issue of the legality of the Panel should be
confirmed.
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Timing of Activity:
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9. Clarifying the Treatment of
Unsolicited PPP Proposals
Summary of Recommendations for Clarifying the Treatment of
Unsolicited Proposals





A key goal of the Government of Mauritius’ PPP policy is encourage innovation in infrastructure and
public services, and allowing unsolicited proposals from private developers is key option for realizing
such innovations.
While unsolicited PPP proposals can encourage private innovation and risk-taking by the private sector,
the international record is problematic. Unsolicited proposals are challenging for Governments to
analyze, to discover the true costs of services, and they often subject the public sector to fiscal risks.
The PPP Unit’s current procedure on unsolicited proposals offers a 10% “bonus” to original proposer’s
price when comparing it with bids from challengers. However, private developers in Mauritius have
reported that this does not provide a meaningful incentive to prepare and submit unsolicited proposals.
Currently neither the contracting authorities nor the PPP Unit have the skills and capacity to fulfill the
tasks required of them by the unsolicited proposals procedure.
The recommended design for a clearer and more effective unsolicited is provided based upon the
principles of protecting of the Government from unwarranted fiscal risks and permitting better pricediscovery.
8.1 The Role of Unsolicited Proposals in PPP:
A key objective of PPPs in Mauritius is to encourage greater innovation in its
infrastructure and public services sectors. One way to encourage such innovation is
through allowing unsolicited proposals for PPPs to be submitted by private sector
developers.
An “unsolicited proposal” is a project concept that is put forward to Government by
a private sector entity when Government has not issued a request for a proposal.
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The unsolicited proposal can include detailed construction, operation, maintenance,
and financing plans. Unsolicited PPP proposals can arise as special cases in the
provision of different types of infrastructure facilities and services which have
limited competition. The private sector proponent will seek to establish an exclusive
position for itself as the sole supplier with whom Government should reach
agreement by advancing arguments such as:




No other private party is interested, or
The private proponent is in a unique position because of ownership of an specialized
asset (including special intellectual property rights) required by the project, or
That it will be the lowest-cost choice in a competitive tender process, or
Concluding an agreement now will be the quickest way to obtain the completed
infrastructure.
The main concern with unsolicited proposals is that Governments usually award
them to the original private sector proponent without sufficient transparency or
competition. As a result, the general public tends to view unsolicited projects as
serving special interests and/or associated with corruption. The international record
has shown that private proponents often propose projects with the specific objective
of avoiding a competitive process. If the private proponent is granted exclusivity for
the project, the private proponent will usually negotiate the project specifics with the
government behind closed doors. This creates a very difficult challenge for the
Government to discover the true price of the services to be provided.
A review of international practices in the treatment of unsolicited PPP proposals can
provide guidance for how Mauritius might better clarify and strengthen its
treatment of them. Many Governments have adopted a number of approaches to
minimise the negative impact of entering an agreement with the proposer of an
unsolicited PPP proposal without permitting the opportunity for competition.
Unsolicited Proposals do not necessary have to be awarded to the original
proponent or negotiated directly. There are four manners in which PPP projects can
be awarded, including having an unsolicited proposal pass through a transparent,
competitive system where other competing proposals have a chance of being
awarded the project.
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Different approaches have been taken by Governments on unsolicited PPP
proposals, including:
(a). Refusal to receive unsolicited proposals on the grounds that the Government has
identified project priorities in its infrastructure plans and does not need to be
deflected from those choices by proposals for projects that are not included in the
plans. Where the unsolicited proposal is made for a project that is included in the
infrastructure plan then it is viewed purely as a matter of timing as to when
Government would seek proposals for the project.
(b). Subject the proposal to the same process as a proposal for a competitively-tendered
project, with no preference being given to the proposer of the unsolicited proposal;
or
(c). Provide an opportunity to competitors to submit counter-proposals but give the
proposer of the unsolicited proposal an advantage such as a bonus in the evaluation
ratings or under a Swiss Challenge process permit the proposer of the unsolicited
proposal to match the best counter-proposal that is better than the unsolicited
proposal; or
(d). Offer compensation for project proposal development costs to the proposer of an
unsolicited proposal.
The specific potential advantages of allowing unsolicited PPP proposals in
Mauritius are:



It breaks-up the current monopoly held by the public sector on ideas for new
infrastructure and public services projects. New project concepts and technologies, not
currently available in the public sector, can be considered. Representatives from
Mauritius private sector noted that there have been several specific new investment
projects in Mauritius that they believe have been held back because the public sector
has not been able to assess and prepare them.10
Many unsolicited PPP proposals can be prepared, contracted for, and implemented
more quickly than those that undergo traditional public sector feasibility analysis and
full and open competitive tendering
For projects that rely on innovative, specialized technologies, or specific assets, which
only a single private developer may be able to provide, an unsolicited proposal can
allow the project to be completed significantly faster
10
Examples have included the Land-Based Oceanic Industry project for developing Mauritius’ pollution-free,
low-salinity, mineral rich ocean currents as well as privately-held lands that could be transferred free-ofcharge to the Government for the development of new, congestion-relieving road and bridge bypasses
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The potential risks and disadvantages of allowing unsolicited PPP proposals in
Mauritius are:



They can be very challenging for the Government to analyze and review technically and
financially. In particular, it can be very difficult for the MOFEE to discover the true
price of the services to be provided.
They can place significant risks or contingent liabilities onto the Government, the which
Government may not fully have fully assessed or adequately valued prior to contract
signing. These contingent liabilities could make the project unaffordable to the
Government as well as reduce the value benefits that the PPP may be able to provide
They can criticized for lack of transparency and fairness
PPPs contracts awarded without open competition have tended to be less thorough
in identifying, analysing, and managing their risks, but both the Government as well
as by the private proposer. As a result, these PPPs are more likely to undergo
contract renegotiations sooner, usually resulting in either higher prices for the public
sector/end-users or lower investment and service delivery obligations for the
private partner.11 Additionally, PPP contracts that are directly awarded instead of
through open, competitive procurement have a higher probability of being
cancelled.12
8.2 International Lessons Learned in the
Treatment of Unsolicited PPP Proposals:
Internationally, the results of unsolicited PPP proposals have been mixed. While
there are examples where they have clearly stimulated new and innovative private
sector-initiated proposals to improve infrastructure and public services; there are
also examples of unsolicited projects that have been structured without
11
For more information on this issue see Granting and Renegotiation of Infrastructure Concessions by Luis
Gausch. This analysis was based on the results of a sample of 1,000 PPP and concession contracts from Latin
America and Caribbean. While some of the results of this analysis may be attributed to institutional traditions
from this region that are not shared by Mauritius, it is recommended that the results from this experience be
noted when estimating the results and impacts of unsolicited PPP projects.
http://info.worldbank.org/etools/docs/library/240056/Granting%20and%20renegotiating%20infrastructure%20
concessions%20%20doing%20it%20right.pdf
12
For more information on this see “Infrastructure Projects – A Review of Cancelled Private Projects 1990 2001” by Clive Harris et al, World Bank Public Policy for the Private Sector, 2002 at
http://rru.worldbank.org/Documents/PublicPolicyJournal/252Harri-010303.pdf
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transparency and that have placed high levels of contingent liabilities and fiscal risks
onto Governments.13
In order to be effective, the framework and procedures for the management of
unsolicited proposal needs to:
1. Ensure that proposals are subjected to some level of transparent and competitive
pressure. This is necessary to protect the Government and consumers from the creation
of a new, un-regulated private monopoly. This competition can be achieved through
such options as:
o Allowing other private developers to submit competing offers to beat the
original unsolicited proposal, often called the “swiss challenge” mechanism
o Awarding the original unsolicited proposer additional evaluation points (also
called “bonus points”) when scoring the proposals.
o Combinations of these mechanisms, including allowing the original proposer to
submit a best-and-final-offer (“BAFO”) to beat the offers submitted by other
competitors
2. Provide PPP Units with the skills, experience, and technical resources to readily quickly
and systematically evaluate these unsolicited proposals. This includes:
o Determining if the project really is a new idea and that it is not already within
the PSIP or has been identified by a Government contracting agency
o Determining if the PPP project is clearly needed by the local economy and offers
positive economic returns
o Determining if the project’s concept and technology is viable and that it is
compatible with existing infrastructure networks
o Reviewing the project’s output service standards to ensure they are clear,
unambiguous, measurable, and monitorable
o Determining if the project is affordable to end-users or to the client Government
contracting agency
o Reviewing the proposed PPP contract structure and risk-allocation, including
identifying all risks or contingent liabilities to be shared by Government
o Prepare project summary and bid documents to allow other firms to submit
competing bids under a “swiss challenge” mechanism; and/or developing bid
13
For more information on the advantages and risks of unsolicited proposals as well as a review of their
international record see “Unsolicited Infrastructure Proposal - How Some Countries Introduce Competition and
Transparency: An International Experience Review” by John T. Hodges and Georgina Dellacha, PPIAF Trends
and Policy Options Number 5, 2006 at
http://siteresources.worldbank.org/INTINFNETWORK/Resources/Unsolicited_Proposals_Experience_Review_Re
port_FINAL_2006.pdf
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o
evaluation criteria and scores to allow the unsolicited proposer to receive the
allowed “bonus points.”
Structure and negotiate PPP contracts with the selected developer, with the
support of transaction advisors
8.3 Current Procedures for Handling Unsolicited
PPP Proposals:
The Mauritius PPP Act’s Legal Conditions for Unsolicited PPP Proposals:
The current legal framework for the treatment of unsolicited PPP proposals in
Mauritius is governed by Section 3C of the PPP Act, which provides the following
conditions:
(1) Any person may identify a project to be implemented under an agreement and
submit to the contracting authority
(a) a description thereof; and
(b) an estimated costs of the feasibility study of the project.
(2) The estimated costs referred to in subsection (1)(b) shall not exceed 3 per
cent of the project value and shall be subject to the approval of the PPP
Committee.
(3) On receipt of a project under subsection (1), the contracting authority
shall, within 15 working days, refer the project to the PPP Committee
together with its recommendations.
(4) Where, pursuant to section 3B(a), the PPP Committee recommends the
retention of the project, the contracting authority shall, within 5 working
days, request the person to submit a proposal in relation thereof, containing
(a) details of his technical, commercial, managerial and financial
capabilities;
(b) a feasibility study containing the technical and commercial details
of the project; and
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(c) the nature of information which is proprietary.
(5) On receipt of the proposal referred to in subsection (3), the contracting
authority shall proceed in accordance with section 4(1)(d).
(6) The person making the proposal shall be requested in the request for
proposal under section 4(1)(d) to submit only its financial proposal.
(7) The contracting authority sha-ll specify in the request for proposal
referred to in section 4(1)(d) [prepare a request for proposal on the approval
of the feasibility study and, where the terms of the model agreement impact
on public finance, seek the approval of the PPP Committee] that in case the
price quoted by the person making the proposal is within the range of 10%
when compared with the price quoted by a preferred bidder, the person
making the proposal shall be the preferred bidder.
(8) The contracting authority shall follow the procedures relating to the
invitation for request for proposal in accordance with this Act.
(9) Where the person making the proposal under this section (a) is not the
successful bidder, the contracting authority shall (i) compensate the person
for the costs of the feasibility study referred to in subsections (1) and (2); and
(ii) claim such costs from the successful bidder. (b) is the successful bidder,
the costs of the feasibility study referred to in subsections (1) and (2) shall be
borne by the person.
Analysis of this section of the PPP Act reveals that the term “unsolicited proposal” is
not explicitly defined in the PPP Act. The fact that a proposal is unsolicited does not
mean it cannot enter the PPP Project Cycle in the same manner and subject to the
same scrutiny and competition as a project that is proposed by a contracting
authority. When an unsolicited proposal contains a unique element e.g. intellectual
property, or ownership of land in a particular location, this clearly limits the
capacity to have fair and open competition and therefore normal PPP evaluation
procedures cannot be applied. In general the current conditions of the PPP Act on
the treatment of is highly-prescription, lacks flexibility, and would difficult to
successfully apply in practice. There is a need for a more detailed process for
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distinguishing an unsolicited proposal with a unique element from an unsolicited
proposal which can be treated as if it is a project being proposed by a contracting
authority.
The PPP Unit’s Current Procedure for Handling Unsolicited PPP
Proposals:
The Mauritius PPP Unit’s current official procedure for the submission and
evaluation of unsolicited PPP proposals consist of:14
1. A private promoter (herein after referred to as the Original Proponent)
submits a project concept and the proposed cost of a detailed feasibility study
to the contracting authority.
2. The contracting authority will examine the project concept in line with the
relevant sector strategies and investment programme. The contracting
authority will make an assessment as to whether the project can be
considered for implementation under a PPP arrangement.
3. Within 15 working days of receipt of project concept, the contracting
authority will have to submit the project concept together with its assessment
to the Public-Private Partnership (PPP) Committee.
4. The PPP Committee may approve or reject the project concept. The
Committee will inform the contracting authority of its decision.
5. If the project concept is retained, the contracting authority must within 5
working days request the original proponent to submit to the Committee –
(a)
details of his technical, commercial, managerial and financial
capabilities;
(b)
a feasibility study containing the technical and commercial details
of the project; and
(c)
the nature of information which is proprietary.
6. The original proponent will not be requested to submit his price proposal at
this stage.
7. The PPP Committee will assess the feasibility study and evaluate the
technical proposal.
14
This “Step by Step Process” for the treatment of unsolicited proposals was provided by the PPP Unit.
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If the technical proposal is accepted, the PPP Committee will
request the contracting authority to proceed with an Invitation to
bid. Pre-selection of bidders will not be required.
(b)
If the technical proposal is rejected, the process will end. The
original proponent will not receive compensation for the cost of the
feasibility study.
8. If the technical proposal of the original proponent is accepted, the contracting
authority must prepare Request for Proposal (RFP) documents which will be
based on information contained in the technical proposal of the original
proponent. The RFP documents must be approved by the Central
Procurement Board (CPB) before bids are invited.
9. The original proponent will be requested to submit his financial proposal to
the CPB. The other bidders must submit their technical and financial
proposals.
10. Mention will be made in the RFP documents to the effect that (a)
the PPP project has emanated from an original proponent whose
technical proposal has been accepted by the PPP Committee;
(b)
the original proponent will be awarded the project if his price is
within 10 % of the price of the preferred bidder; and
(c)
If the original proponent is not awarded the contract, the
contracting authority will compensate the original proponent the
approved cost of the feasibility study. The contracting authority
will claim such cost from the successful bidder.
11. The CPB will evaluate bids received and will give its approval for the award
of the project to the successful bidder.
(a)
Currently, neither the PPP Unit nor the Government’s line ministries, contracting
authorities, and public corporations have the experience or capacity to fulfill these
procedures listed above. Specifically, most line ministries, contracting authorities,
and public corporations are not able to prepare an adequate assessment of a given
private proposal to determine if it is an appropriate PPP. This has been verified
through meetings with numerous line ministries and contracting agencies, the PPP
Unit, the Projects Plan Committee. Nearly all are not able and recommend publiclyidentified investment projects (from the PSIP) that would make appropriate
candidates for PPP. If unsolicited PPP proposals are to be allowed, then the new
PPP Unit and contracting authorities must first have the capacity to comply with the
tasks and timelines required.
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Goals and Concerns of the Government of Mauritius and the Private
Sector Regarding Unsolicited Proposals:
A number of leaders from Mauritius’ private sector have expressed interest in seeing
unsolicited PPP projects featured in Mauritius infrastructure. This has included
representatives from the Joint Economic Council, from commercial banks, and from
the sugar industry and property development sectors. Specifically, unsolicited PPP
proposals have been discussed for the development of a new road by-pass project in
Moka, whereby a private landowner would provide the land for the new road to the
Government free-of-charge, if the Government would construct and maintain the
new road. The Government and public would receive the benefit of acquiring the
land for free and have a new bypass available to improve local traffic flows. The
land-owner would see the value of its own adjoining lands increase in value due to
the completion of the new by-pass.15 Other privately-identified infrastructure
projects in Mauritius include the construction of a new bridge on land that is
currently privately-owned, as well as the development of wind-energy farm in the
south of Mauritius. In general, the local private sector would like to see that the
process for unsolicited PPP proposals clearly allows such proposals, ensures timely
reviews and approval decisions, and that intellectual property rights are protected.
According to the MOFEE, the primary concern of the Government is that the process
for unsolicited proposals protects the public against projects that are too expensive.
Specifically, there must be a clear process whereby the Government can
transparently discover true prices, determine the costs of the private proposer,
including its returns on investment. When it is not possible to discover the true
costs of such privately-proposed projects, then the Government risks paying higher
price premia at the expense of public welfare. A key goal of the MOFEE, therefore,
is that the PPP framework’s unsolicited proposal process is able to protect the
Government against PPP projects that offer do not offer price discovery.
15
This specific project for the Moka Road Bypass has been assessed for its appropriateness as a PPP in the
Second Volume of the Mauritius PPP Support Project, entitled “Identification and Preparation of Potential PPP
Projects.”
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8.4 Recommendation: Establish the capacity of
the new PPP Unit to evaluate and manage
unsolicited PPPs and design and draft a new PPP
Unit regulation on the handling of unsolicited PPP
proposals.
Specific Actions:
The capacity of the PPP Unit to quickly evaluate unsolicited proposals needs to be
increased through:





As recommended in Section 5.1 above appoint both a PPP Framework & CapacityBuilding Manager and a Resident PPP Adviser.
The PPP Framework Specialist oversees the design of the unsolicited proposal
procedure, supported by the advice of the Resident PPP Adviser. The PPP Unit may
choose to engage an experienced PPP procurement specialist as a consultant to focus
on supporting the completion of this activity
Provide detailed training for the staff of the PPP Unit on PPP project evaluation
techniques and models (note that this action is also recommended in Section 6 below
on PPP capacity building)
Establish a Panel of pre-qualified PPP transaction advisors that the PPP Unit can
rapidly turn to with requests to evaluate unsolicited proposals (as recommended in
Section 5.3 above).
Conduct annual evaluation reviews of the unsolicited proposals by the PPP Unit,
supported by outside specialists as necessary, to determine if the unsolicited
proposals mechanism should be modified and improved.
Recommended Organization & Key Contents of a Regulation on
Unsolicited PPP:
(1). An unsolicited proposal for a public private partnership arrangement is one that:
(a). is not relating to a project that has been or is being considered for
admission to the PPP Project Cycle;
(b). is independently originated and developed by the proposer;
(c). is prepared without supervision or involvement of a State authority or
the PPP Unit;
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(2).
(3).
(4).
(5).
(6).
(7).
(8).
(9).
(10).
(11).
(12).
(13).
(d). is presented with a completed PPP registration form that is required to be
submitted by a State authority that seeks to have a project admitted to the
PPP Project Cycle;
(e). includes detailed information to permit evaluation of the proposal in an
objective and timely manner.
A State authority may receive an unsolicited proposal but must immediately
provide a copy of the unsolicited proposal to the PPP Unit.
Within [
] working days after receiving an unsolicited proposal, the PPP Unit
must undertake a preliminary evaluation of the unsolicited proposal to determine
if the proposal complies with the requirements under subsection (1) and inform the
State Authority of the determination.
Prior to submission of an unsolicited proposal, a private entity may request a
review by the PPP Unit of information that the private entity has identified as
confidential or proprietary to determine whether such information would be
subject to disclosure under disclosure requirements in PPP legislation.
A private entity may identify confidential or proprietary information submitted as
part of an unsolicited proposal and have an opportunity to object to the release of
any information it identifies as confidential or proprietary.
The PPP Unit must review any information identified as confidential or
proprietary by a private entity as part of an unsolicited proposal and decide if such
information is exempt from disclosure under PPP legislation and inform the
private entity of its decision.
The private entity shall have the opportunity to object to the determination that the
information is subject to disclosure under the PPP Act or to withdraw its proposal.
Any information determined by the PPP Unit to be confidential or proprietary
shall be exempt from disclosure under PPP legislation.
Any information not determined to be confidential or proprietary may be subject
to disclosure under PPP legislation.
The PPP Unit must take appropriate action to protect confidential or proprietary
information that a private entity provides as part of an unsolicited proposal and
that is exempt from disclosure under PPP legislation.
If the unsolicited proposal does not comply with the subsection (1), the PPP Unit
must return the unsolicited proposal without further action.
If the unsolicited proposal complies with the subsection (1), the PPP Unit assesses
and decides whether the proposal satisfies the definitions of a project,
infrastructure and public private partnership arrangement in the Act and meets the
minimum criteria for admission to the PPP Project Cycle.
The PPP Unit procedures, guidelines and instructions, approved by the PPP
Committee and the Minister, must contain minimum criteria which a project
submitted in an unsolicited proposal is to satisfy to be eligible (a) for admission to
and (b) to continue within the PPP Project Cycle.
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(14). The PPP Unit must refer the matter to the PPP Committee for approval to admit
the proposal to the PPP project cycle or to exclude the proposal.
(15). If the PPP Committee approves the unsolicited proposal for admission to the PPP
project cycle, a PPP Project Team is appointed in the same manner as set out in the
Feasibility Phase above.
(16). The PPP Project Team advertises the unsolicited proposal with an invitation for
competing proposals for the proposed facility or service.
(17). The advertisement must contain (a) an outline of the general nature and scope of
the unsolicited proposal, including the location of the facility or service provision
and the work to be performed on or in connection with the facility or service
provision; (b) must specify an address to which a competing proposal may be
submitted; (c) specify a reasonable time period by which competitors should
submit a competing proposal to the PPP Unit
(18). The PPP Unit may charge a reasonable fee to cover its costs to process, review, and
evaluate an unsolicited proposal and any competing proposals.
(19). The PPP Project Team must:
(a).
determine if any competing proposal is comparable in nature and
scope to the original unsolicited proposal;
(b).
evaluate the original unsolicited proposal and any comparable
competing proposal using factors that shall be declared in the request
for proposals; and
(c).
conduct good faith discussions with proponents.
(20). After evaluating the unsolicited proposal and any competing proposals, the PPP
Project Team may recommend to the PPP Committee either to:
(a). accept the unsolicited proposal and reject any competing
proposals;
(b). reject the unsolicited proposal and accept a comparable
competing proposal if the PPP Unit determines that the
comparable competing proposal is the most advantageous to the
State;
(c). accept both an unsolicited proposal and a competing proposal if
accepting both proposals is advantageous to the State; or
(d) reject the unsolicited proposal and any competing proposals.
Monitoring of Actions: The PPP Unit’s progress and completion of this Unsolicited
Proposal procedure activity will be monitored by the PPP Committee and by
MOFEE Finance Secretary. The PPP Unit will monitor the consultant it has engaged
to support drafting of the unsolicited PPP proposals procedures.
Required Resources:
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1. Direct the existing resources at PPP Unit, the Public Procurement Office (PPO), the PPP
Committee, the MOFEE’s Finance Secretary, the Cabinet, and other stakeholders to
coordinate and oversee the above tasks. It will be important to ensure that the PPO
reviews the design of the unsolicited proposals procedures to ensure they are consistent
with Mauritius’ procurement regulations.
2. The PPP Unit’s new full-time PPP Framework & Capacity-Building Manager will
oversees the design of the unsolicited proposal procedure, supported by the advice of
the PPP Unit’s new Resident PPP Adviser. The PPP Unit may choose to engage an
experienced PPP procurement specialist as a consultant to focus on supporting the
completion of this activity. The estimated additional level of effort of these to complete
this one activity is:
o Local PPP Procurement Specialist = 30 days
S.M.A.R.T Analysis of Recommended Activity:
Recommendation: Establish the capacity of the new PPP Unit to evaluate and manage unsolicited
PPPs and design and draft a new PPP Unit regulation on the handling of unsolicited PPP proposals.
Specificity: How is it Specific?
This will consist of the both the design, drafting and approval of a
new PPP Unit Regulation on Unsolicited PPP Proposals as well as the
completion of capacity-building plan to strengthen the PPP Unit’s
ability to manage unsolicited proposals.
Measurable: How will it be
Measured?
Successful completion of this activity can be clearly measured by
three discrete steps:
Achievable: Is the task
achievable, and what does
Achievement look like?
o
Completion of design & drafting a new Unsolicited PPP
proposal regulation
o
Review & Approval of the regulation by MOFEE & PPP
Committee
o
Capacity-building program for PPP Unit on responding to
and managing Unsolicited Proposals (including through
the Panel of PPP Experts)
Before the design and drafting of an effective PPP Guidance Manual
can begin, the fundamental powers, functions, and duties of the PPP
Unit and the required process for implementing PPP in Mauritius must
first be established by the completion of the PPP Policy Statement,
the PPP Law & Regulations. Without this foundation, this task should
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Recommendation: Establish the capacity of the new PPP Unit to evaluate and manage unsolicited
PPPs and design and draft a new PPP Unit regulation on the handling of unsolicited PPP proposals.
not be initiated. Once the PPP Policy and revised Law & Regulations
are adopted, the completion of this activity will not be difficult to
achieve. Specific contents for this new unsolicited proposal
regulation have already been identified in this Report. Because of
the important risks and controversies inherent in unsolicited
proposals, a new regulation on unsolicited proposals that is
acceptable to the Government may not necessarily still be attractive
to the private sector.
Relevance: Why is it Relevant
to the overall
program/strategy/goals?
The current PPP Unit regulation on Unsolicited Proposals has been
noted to be difficult for the PPP Unit to manage, risky for the for
Government, and unattractive for the private sector. It has been
identified as a priority for the both the Government and for the
private sector. A new, clearer regulation on unsolicited proposals
should at least provide better protection for Government’s interests
in ensuring the PPPs are affordable and do not expose the
Government to imprudent risks.
Timeliness: By when will be
achieved?
The design, and drafting of the new Unsolicited Proposal regulation
should commence after the revised PPP Act & Regulations have been
passed. This may therefore require more time to achieve, as it is
dependent upon the availability and willingness of the National
Assembly to pass the Act.
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Timing of Activity:
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9. Assessment and
Recommendations for PPP
Information Flow, Training &
Capacity Building
Summary of Assessment & Recommendations for PPP Information
Flow, Training & Capacity Building





The ability of PPP projects in Mauritius to be prepared and completed is significantly constrained by
limited PPP knowledge, skills, and experience within the public sector as well as in the private sector.
To both improve the PPP framework as well as to prepare and complete PPP transactions, Mauritius
requires a single focal-point to coordinate a systematic PPP training and capacity-building initiative
The PPP Unit should play the role of coordinating PPP training and capacity-building for a range of
stakeholders in Mauritius, including the Government, the private sector, as well as for donors and other
organizations. The PPP Unit’s new PPP Framework & Capacity-Building Manager should perform this
coordination.
The PPP Unit should partner with and oversee training firms and other training institutions, who will
design and deliver the PPP training and capacity-building events. A list of donor sponsors of training has
been provided, which the PPP Unit should approach with requests to help fund and support PPP training
activities.
PPP training in Mauritius should be focused to support the preparation and completion of specific PPP
projects, rather than to increase general awareness of PPP concepts. A recommended program of both
introductory and project-specific PPP training activities has been provided.
This section assesses “information-flow” as it pertains to the flow of general
information about the PPPs, about Mauritius’ PPP framework, and about the
models, skills, and techniques needed to build PPP capacity. This section does not
address the process of “information flow” regarding a specific PPP project or
transaction. That subject is has addressed in the Section 5.2 above.
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9.1 PPP Information Flow, Training & Capacity
Building
While Mauritius has a number of important public documents available on its
current as well as its past PPP policy, legal, and institutional framework, there is still
an important level of lack-of-awareness within the public sector about the PPP
framework in particular and about PPP concepts and techniques generally.
Mauritius’ new PPP framework needs to provide a comprehensive strategy for
providing training and capacity-building on PPP concepts, techniques, and skills not
only to the managers and leaders of public sector bodies (ministries, contracting
authorities, and parastatals), but also to representatives of Mauritius’ private sector
and its non-governmental organizations. This is a function that the PPP Unit should
take the lead in coordinating and managing, working together with specialized PPP
training institutions. Additionally resources will be needed to enable the PPP Unit
to coordinate and manage this effort as well as to access the outside PPP training
specialists that can design and deliver these services.
There is too much reliance on inexperienced contracting authorities to initiate,
evaluate, process and implement PPP projects. Is a project desirable, how does PPP
compare with traditional public procurement and how should PPP procurement be
brought about and with what risk allocation are simple questions to ask, complex
questions to answer with confidence. Expertise and experience are needed.
Contracting authorities need to involved in the PPP project cycle in a different way
than at present and not remain as ineffective leaders and managers of the PPP
process for a project.
This PPP capacity building activity can provide important support to nearly all of
the other activities of this PPP framework development. Any PPP training and
capacity-building events would be integrated within the strategy to support the
other key recommended activities of Mauritius’ new PPP framework. Thus far, PPP
capacity building has been limited to a small number of brief training sessions
provided by outside PPP consultants sponsored by donors. Additionally, several
individual Mauritian officials have attended short-term PPP training programs held
in countries including South Africa, Australia, and the USA.
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As noted previously, there is limited understanding of the full requirements of
implementing PPPs in Mauritius by line ministries, contracting authorities, and
public corporations. Even the PPP Unit has noted that it has not found the PPP
Guidelines Manual that was previously developed for it in 2006 to be a practical or
user-friendly tool to apply. The State Law Office noted that it is very difficult for the
Government to make PPP contract award decisions when those public officials on
the Committee are not familiar with the basic rationale for PPPs and how non-price
factors, like risk-transfer, must be evaluated in award decisions.
Nearly all of the line ministries, contracting authorities, public corporations, as well
as private sector representatives contacted during this assignment expressed that
much more PPP capacity-building, training, and skills development are needed.
Additionally, there are many organizations that are currently active in supporting
and sponsoring PPP-related capacity building and training, which the PPP Unit
should consider partnering with on either a long-term or on a short-term, programby-program basis. Mauritius is not alone in facing this constraint of limited
knowledge within both the public and private sectors about PPPs and how to
implement them. Many other countries have and continue to be hampered by the
constraint.
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Lessons Learned from South Africa’s Approach to Developing PPP Knowledge, Skills & Capacity:
South Africa faced a somewhat similar constraint, although on a different scale. In the mid & late
1990’s, prior to the passage of the Public Financial Management Act of 1999, many of South Africa’s
municipal government expressed clear interest in considering PPPs to help them urgently address the
tremendous backlog they faced in providing basic public services to their constituents. In 1999, with
the help of international donors, such as USAID, the National Government’s Department of
Constitutional Development and Local Government worked with an association representing 6 local
universities, called JUPMET (Joint University Public Management and Education Training) to train a
cadre of approximately 45 professors and lecturers in Public Administration on PPP models and
techniques. Additionally, the South Africa Local Government Association (SALGA) has sponsored scores
of PPP workshops for several hundred local government officials from across South Africa using both
these university Public Administration professors and trainers to teach in them, as well as officials from
the National Treasury’s PPP Unit and the former Municipal Infrastructure Investment Unit (MIIU). For
the past decade, the National PPP Unit has been a leader in both educating the public and in helping to
train both public and private sector officials on PPPs. It has developed model PPP training materials as
well as newsletters and case studies analysing lessons learned from South Africa’s own PPP projects.
Today, South Africa has one of the broadest as well as the one of the deepest levels of knowledge,
experience, and capacity within its public sector compared to other developing economies.
The PPP framework in Mauritius needs to have a single institutional focal point for
addressing PPP capacity-building and training needs. One the best-suited places for
this would be within the PPP Unit. While the PPP Unit would need additional
human and financial resources to properly coordinate this initiative, it should
consider partnering with other local institutions to actually deliver the needed PPP
training and capacity-building initiatives.
Currently the PPP Unit does not have the resources or technical capacity in-house
required to design, prepare, and implement the technical components that would be
required. For the new PPP framework to be able to offer or to support the kinds of
PPP training and capacity-building activities needed by key stakeholders in
Mauritius, new PPP technical capability will needed, whether from new PPP
specialists brought in to the Unit or from new partner organizations.
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9.2 Recommendation: Design & Implement
Comprehensive PPP Capacity Building Program
Specific Actions:
1. Identify a single body to take the lead in developing Mauritius’ PPP capacity
building and training. The PPP Unit could establish a partnership or
cooperative agreement with a local training institution to develop this PPP
training capacity and to conduct training activities
2. Organize a series of PPP training models that are closely linked to the Phases
of the PPP life-cycle as defined by Mauritius’ new PPP Guidance Manual.
Training should be conducted to address the needs of two different groups:
o In-Depth training on PPP techniques should be offered to PPP
Unit staff, PPP project managers at line ministries and
contracting authorities, and for members of the PPP Committee
o Introductory-level training on PPP concepts should be offered
to other senior policy-makers and officials not intensively
involved with structuring PPPs
3. Prepare model PPP training materials and train trainers to be able to conduct
PPP training workshops when needed
4. The goal of this initiative should be to use PPP training and capacity-building
activities to support the completion of PPP transactions first, rather than to
simply introduce a broad range of officials to general or introductory PPP
concepts and models. Therefore, the first activities should consider
supporting the process to complete the current portfolio of PPP transactions
being prepared and evaluated in Mauritius including:
o Real estate development,
o Road transportation, and
o Energy generation projects.
The next round of activities should consider supporting the capacity of
analyzing PPPs in sectors like water, wastewater, electricity, fisheries,
hazardous waste management, and roads.
5. Seek formal partnership relationships with 3-4 other training organizations
that support and could help sponsor PPP training for Mauritius such as:
o The World Bank Institute’s Multilateral Public-Private
Partnerships in Infrastructure Capacity Building (MP3IC),
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o The Development Bank of Southern Africa’s (DBSA) Vulindlela
Academy,
o The Southern African Development Community’s (SADC)
Banking Association
o The African Development Bank’s Vice Presidency for
Infrastructure and Private Sector, which is launching a new
PPP Strategy, including support for PPP capacity-building,
together with the AfDB’s Joint Economic Institute.
6. Offer 2-3 introductory-level PPP training programs per year
7. Offer 2-3 new in-depth PPP training workshops per year in support of other
specific PPP projects and transactions
8. Conduct annual evaluation reviews of PPP capacity building program by
outside training specialists to determine if the program should be modified
and improved.
Estimated Resources Required:
The PPP Unit’s new full-time PPP Framework & Capacity-Building Manager will
spend roughly half of his/her time coordinating and managing PPP training
activities and the other half supporting the other institutional development
activities. It should be expected that the staff of the PPP Unit will spend some time
preparing and providing some of the presentations and sessions of these workshops.
This includes the Chief Executive, the Resident Adviser, as well as the PPP
Framework & Capacity-Building Manager. However, the core responsibility for
implementing these courses should be sourced to experienced PPP trainers and
firms, so that that PPP Unit does not become overwhelmed by all of the
administrative requirements of planning and conducting training events. Outside
PPP specialists or firms would be hired on an event-by-event basis to help design
and conduct specific PPP courses.
Monitoring of Actions: The PPP Unit’s progress and completion of this PPP
Capacity Building activity will be monitored by the new PPP Committee and by
MOFEE Finance Secretary. The PPP Unit will monitor the training partner
institution and it has engaged to conduct PPP training events. Evaluations of the
training activities by the participants will provide feedback for improving the design
and effectiveness of future PPP training events in Mauritius.
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S.M.A.R.T Analysis of Recommended Activity:
Recommendation: Design & Implement Comprehensive PPP Capacity Building Program
Specificity: How is it Specific?
This will consist of the planning and implemention of a series of PPP
training and capacity-building initiatives. To ensure that this activity
delivers value, and does not spread its resources too thinly, it is
recommended that each training activity target a specific PPP
transaction’s stakeholders. This will keep the training events specific
and ensure that they help develop specific PPP investment projects.
Measurable: How will it be
Measured?
Successful completion of this activity can be clearly measured by
three discrete steps:
Achievable: Is the task
achievable, and what does
Achievement look like?
o
Designing a program of both general and specific PPP
training events
o
Conducting and completing PPP training events
o
Evaluating the results of each PPP training event
Achievement will consist of:
o
The completion of the design of the specific PPP training
programs
o
The completion of the implementation of the PPP
training program
o
The development of the new skills, as described by the
Learning Outcome Statements (LOSs), by the officials
attending each training event
Relevance: Why is it Relevant
to the overall
program/strategy/goals?
The development of both general understanding of PPP requirements
as well as skills in managing the preparation, evaluation, and
approval of PPP projects are relevant to the ability of both the PPP
Unit and contracting authorities to be able to implement and
complete PPP transactions in Mauritius. Without this PPP capacitybuilding activity, it will continue to be difficult to complete PPPs in
Mauritius
Timeliness: By when will be
The implementation of this activity can commence as soon as the PPP
Unit hires the PPP Framework and Capacity-Building Manager to
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Recommendation: Design & Implement Comprehensive PPP Capacity Building Program
achieved?
oversee it. The schedule for training workshops can occur regularly
each year.
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Timing of Activity:
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10. Assessment and
Recommendations for
Strengthening Mauritius’ Private
Sector Capacity for Implementing
PPPs
Summary of Assessment & Recommendations for Strengthening
Mauritius’ Private Sector Capacity for Implementing PPPs





Mauritius’ private sector firms have demonstrated important interest in and capacity to develop and
finance PPP through the first independent power project investments.
However, Mauritius’ private investors and lenders express significant concerns about the current
framework for PPPs. These include concerns that the current PPP framework is unclear, lacks highlevel support within Government, Government institutions lack the capacity to prepare and evaluate
PPPs, and concerns that Government may seek to renegotiate PPP contracts after they have been
signed.
Although there are periodic, ad hoc public-private dialogues, currently there is no regular mechanism
for communication and cooperation between the Government and the private sector on PPPs.
Moreover, the private sector has expressed that current ad hoc communications on PPPs are not
effective.
A recommended solution is to establish a PPP Forum for leaders of the public and private sectors to
regularly meet (twice annually) to discuss specific PPP issues and seek agreement on solutions.
A plan for establishing and managing this PPP Forum has been provided.
The framework for PPPs will need active participation from the local private sector in
Mauritius in order to be sustainable. In addition to bidding on PPP tenders and
providing equity and debt to local PPP investments, local private firms should be
invited to work with the Government to structure the rules of the game for the
country’s new PPP framework. While some larger PPP investment projects will require
international investors, lenders, and contractors, there will be numerous medium-sized
projects that will be implemented by local developers and lenders.
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10.1 Mauritius Private Sector Organizations:
Key groups and organizations that represent the private sector in areas related to PPPs
include:





The Joint Economic Council (JEC)
The Mauritius Chamber of Commerce & Industry (MCCI)
The Mauritius Bankers Association
Mauritius Export Association (MEXA)
Building and Civil Engineering Contractors Association
Several of these organizations have shown the local private sector to be supportive of
the strategy of expanding and improving Mauritius’ infrastructure through PPPs. For
example, the JEC actively lobbied for the Government to issue is PPP Policy Statement
in 2003 and the PPP Act of 2004.
10.2 Private Sector Concerns Over PPP Framework
and Projects in Mauritius
However, the local private sector has noted a number concerns that they recommend
should be addressed in any revised approach to PPPs:






There is limited capacity in the Government to manage the entire process of selecting,
analysing, structuring, tendering and completing PPP transactions.
The current sequence of procedures to prepare and implement PPPs is too time-consuming
and inefficient.
Any efforts to improve or restructure Mauritius PPP framework should have clear, active,
and visible support from the highest levels of the Government, specifically from the
Cabinet and the Prime Minister. Some in the private sector see this as the 3rd effort to
establish a PPP framework (after the Concession Project Act of 1997 and the PPP Act of
2004); if it is to be successful this time, it must be backed by a high-level commitment.
To show its commitments to working in long-term partnership with the private sector, the
Government should refrain from its calls to renegotiate previous PPP contracts, specifically
the country’s first four power purchase agreements signed with private sugar industries in
the 1990’s.
The private sector’s own knowledge of PPPs and how to analyze risks (like market demand
risks) and structure bankable PPPs will need to be increased.
The current unsolicited projects incentive of receiving a 10% “bonus” on price evaluations
is generally not attractive to private developers and is seen as impractical to implement.
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Private Financing for PPPs in Mauritius:
Compared to most other countries in SADC and COMESA region, Mauritius has a
relatively stronger capacity to finance a number of its PPP investments locally.





Commercial banks in Mauritius already have experience with local limited-recourse project
financings, most notably with the four independent power projects with the private sugar
industries that were negotiated and financed in the 1990’s.
Commercial lenders, like the Mauritius Commercial Bank report that they are able to offer
local floating-rate Rupee loans for terms up to 20-25 years. They can also make US Dollarbased loans.
Lenders and investors would expect that any PPP signed with a Government contracting
authority, such as the Central Water Authority (CWA) or the Wastewater Management
Authority (WMA) would require a financial performance guarantee by the MOFEE to backup their ability to make contracted payments to PPP companies.
The private sector would be willing to share ownership of PPP projects with the
Government (ie Government owning a minority stake), but it would it would require that
all management and operation of PPPs be through private firms.
Because of the recent, on-going experience of the Government’s request to renegotiate the
first 4 power purchase agreements, all future PPP agreements would need to have “airtight” language to protect against future price renegotiations and to ensure clear formulas
for planned, scheduled price adjustments.
There are several sources of both debt and equity financing for PPPs that are interested
in PPP investment opportunities in competitive business climate’s like Mauritius’.
These can provide a range of PPP financial products, including commercial debt,
subordinated debt, as well as equity. Several of these private infrastructure funds that
can invest in PPPs in Mauritius include:

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
Emerging Africa Infrastructure Investment Fund (AIIF)16
Rising Africa Infrastructure Fund (RAIF)17
Pan-African Infrastructure Development Fund (PAIDF)18
Several Multilateral Development Banks can provide a range of important financial
products for PPPs in Mauritius (as well as supporting technical assistance and capacity
building) including partial guarantees, debt and equity. These include:
16
See Emerging Africa Infrastructure Fund (EAIF) at http://www.emergingafricafund.com/home.aspx
RAIF is a $500 million fund to invest in public-private infrastructure projects throughout Africa over a 15-year
period. Managed by Natixis Environnement & Infrastructures (NEI), a subsidiary of the French investment bank
Natixis.
18
Launched in June, 2007 PAIDF is designed to invest $1 billion in public-private infrastructure projects in Africa
over a 15-year period. The fund is designed to invest in the telecom, energy, transport, and water & sanitation
sectors.
Managed by Harith Fund Managers in South Africa, http://www.harith.co.za/
17
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


World Bank: Partial risk guarantees to PPPs
African Development Bank, Private Sector Operations Dept. (PSOD): commercial debt,
equity, and partial risk guarantees to PPPs
International Finance Corporation: Commercial debt, subordinated debt, and equity
investments in PPPs
The managers of these private infrastructure funds, as well as of the departments of
these MDBs are very interested in new potential investment opportunities in
competitive business climates, like Mauritius. They are also generally interested in
knowing about efforts to reform and improve PPP investment frameworks. It is
recommended that the PPP Unit keep these organizations informed about both new
PPP investment opportunities in Mauritius as well as about proposed changes to the
PPP framework.
Public-Private Communications on PPP Framework Issues: The PPP Forum
The recommended PPP legislation would provide for a PPP Forum, made up of
representatives of the public and private sectors interested or involved with PPP. The
purpose of the PPP Forum is to provide an opportunity for all persons in society,
business and government that are involved with, may be affected by or have an interest
in the procurement or development of infrastructure by way of public private
partnership arrangements and the implementation of PPP projects can meet to discuss
and exchange views on relevant issues. It would meet perhaps twice yearly or at other
times where members demand a meeting. The PPP Unit would act as secretariat to the
PPP Forum and the PPP Committee would attend meetings of the PPP Forum.
10.3 Recommendation: Establish a PPP Forum for
Key Public & Private Sector Leaders
Specific Actions:
1. As part of approving the new PPP Policy and the new PPP Law, The PPP Committee and
the MOFEE Finance Secretary task the PPP Unit with the design and establishment of a PPP
Forum.
2. PPP Unit’s PPP Framework Development and Capacity-Building Manager will be
responsible for overseeing the design a new PPP Forum. For example, the PPP Forum
would be required to meet twice per year to ensure regular communication on important
PPP issues between the public and private sectors.
3. First meeting of the PPP Forum is held, managed by the PPP Unit, featuring leaders from
both the public and private sectors.
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4. The first PPP Forum’s recommendations and results are evaluated by the PPP Unit for
inclusion in PPP framework initiatives.
5. Conduct annual evaluation reviews of the PPP Forum by outside specialists to determine if
the Forum’s design or operation should be modified and improved.
Monitoring of Actions:
The PPP Unit’s progress and completion of this PPP Forum activity will be monitored
by PPP Committee under existing arrangements and by MOFEE Finance Secretary. The
PPP Unit will monitor the consultants it has engaged to support restatement of the PPP
Policy.
Required Resources:


Direct existing resources at PPP Unit, the PPP Committee, the MOFEE’s Finance
Secretary, the Cabinet, and other stakeholders to the above tasks. Contributions of time
will also be needed by key private sector leaders in Mauritius, such as the Joint
Economic Council (JEC).
The PPP Unit’s new full-time PPP Framework & Capacity-Building Manager will
oversee the design and launching of the PPP Forum. As this activity will likely require
important outreach, awareness, and promotion of the new PPP Forum to Mauritius key
public and private sector institutions, the PPP Unit may require the assistance of a
promotion and public relations specialist, especially when the PPP Forum is first
launched. The additional, estimated level of effort for this activity is:
o Promotion and Public Relations Specialist = 25 days
S.M.A.R.T Analysis of Recommended Activity:
Recommendation: Establishing a PPP Forum of Key Public & Private Sector Leaders
Specificity: How is it Specific?
This activity consists of both establishing and managing a new PPP
Forum consisting of key leaders from Mauritius’ Government and
private sectors. The meetings and communications of the PPP Forum
will need to focus on resolving priority PPP framework and projectrelated issues.
Measurable: How will it be
Measured?
Successful completion of this activity can be clearly measured by
three discrete steps:
o
Establishing the new PPP Forum and promoting it to key
leaders from the public and private sectors
o
Finalizing its first meeting agenda and holding its first
official session
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Recommendation: Establishing a PPP Forum of Key Public & Private Sector Leaders
o
Monitoring how both the Government and the private
sector follow-up on the discussions and on any
agreements reached during the PPP Forum
Achievable: Is the task
achievable, and what does
Achievement look like?
Currently there are no official or legal constraints to establishing
such a PPP Forum. However, to recognize its importance to
Mauritius’ PPP strategy, and to ensure its success and support, it is
recommended that its establishment be required by the revised PPP
Act, and that it further be required to meet twice yearly. This will
better assure its achievability.
Relevance: Why is it Relevant
to the overall
program/strategy/goals?
The PPP Forum is clearly needed to address the current confusion
both within Government and within the private sector about
Mauritius’ PPP framework as well as its capacity. Although bodies
like the Joint Economic Council (JEC) already exist to improve
communications between the Government and the private sector, a
more focused platform is needed to address pressing issues and
constraints to PPPs in Mauritius. Without this Forum, it will be
difficult to improve private sector interest in PPPs in Mauritius above
its current level.
Timeliness: By when will it be
achieved?
The implementation of this activity can commence as soon as the PPP
Unit hires the PPP Framework and Capacity-Building Manager to
oversee it. The schedule for PPP Forum meetings can occur
regularly, twice each year.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
Timing of Activity:
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
11. Recommended Work Plan for
the PPP Unit
The practical focal point for all of these PPP institutional recommendations is the
PPP Unit. Clearly the human and financial resources of the PPP Unit will need to be
expanded to enable to coordinate and oversee these important initiatives. As noted
previously, terms of reference are provided as annexes to this report for the
recruitment and hiring of key staff for the PPP Unit, including:
1. Resident PPP Adviser
2. PPP Framework Development & Capacity-Building Manager
3. Chief Executive of the PPP Unit
Through these three specific positions, as well as from the support of specific
shorter-term PPP specialists, the Government of Mauritius should be prepared to
allocate adequate support to the PPP Unit to carry-out a new work plan whose
major initiatives would include:






Overseeing the development of Mauritius’ new PPP Policy Framework;
Overseeing the development of Mauritius new Legal Framework, especially the
detailed drafting, discussion/debate, and passage of a new PPP Law and of companion
PPP implementing rules and regulations;
Overseeing the development and establishment of a new, more efficient Manual of PPP
project evaluation and preparation procedures;
Working with line ministries, contracting authorities, and parastatals to both expand
and to implement the portfolio of PPP projects in Mauritius;
Implementing a broader new PPP training, capacity-building, and information-sharing
initiative for leaders and managers from Mauritius’ public sector, private sector, nongovernmental sector, and others; and
Developing models and procedures to ensure that there is adequate capacity and
procedures for PPP project performance monitoring, contract compliance, and service
delivery.
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Mauritius PPP Support Project – Analysis & Review of PPP Legal & Institutional Framework
The following matrices describe the key activities that comprise the recommended
work plan for the PPP Unit.
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163
164
165
APPENDIX A: Details of Specific
PPP Legal and Institutional
Changes since PPP Policy
Statement 2003
Legal Framework Changes since PPP Policy Statement 2003
o PPP Act 2004 passed by Parliament Nov 2004 proclaimed Mar 2005
o Public Procurement Act 2006 proclaimed 2008
o Public Procurement Regulations 2006
o PPP Guidance Manual 2006 (PPP Unit)
o PPP Act amendments 2008
o Public Procurement Act amendments 2008 and 2009
Investment Project Process Manual December 2008 (Ministry of Public
Infrastructure, Land, Transport and Shipping) issued in accordance with section
22A19 of the Finance and the Audit Act as amended by the Finance and Audit
19
22A(1) The Minister to whom responsibility for the subject of public infrastructure is assigned
shall, after consultation with the Minister, issue instructions including instructions in the form of
Investment Project Process Manual for better (a) organising the investment projects process; (b)
developing a single window system for approval of projects; (c) establishing best practices in
budget expenditure in respect of investment projects based on Programme-Based-Budgeting
principles; (d) developing a well defined long-term pipeline of projects; (e) ensuring active
participation of the implementing Ministry or Department in the process leading to a timely
completion of projects within the approved budget. (2) Every public officer shall, in the
performance of his duties, comply with the instructions referred to in subsection (1).
22B. Non-compliance with instructions Where a public officer does not comply with (a) the General
Orders; (b) financial instructions issued under section 22; or (c) instructions issued under section
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(Amendment) Act 2008. Section 22A of the principal Act came into operation on 1
October 2008. [Note: It is unusual for powers under public financial management
legislation to be given to a Ministry other than the Ministry responsible for finance.]
Mauritius Land Transport Authority Act 2009 Act No. 17 of 2009 Government
Gazette of Mauritius No. 97 of 31 October 2009. [Note: This Act was passed by the
National Assembly on 27 October 2009 but may not yet have been proclaimed by the
President in which event it is not in force. Time gaps between passing legislation
and proclaiming legislation is a source of uncertainty. The Act makes no reference to
PPP.]
Institutional Changes since PPP Policy Statement May 2003
Responsibility for PPP transferred from Ministry of Economic Development,
Financial Services and Corporate Affairs to Ministry of Finance and Economic
Development (later MOFEE) 2005
Public Procurement Office set up, Central Tender Board became Central
Procurement Board and changed role and functions (2008)
PPP Unit given more limited functions than in PPP Act as enacted (amendment
2008)
Financial Secretary role in PPP Act replaced by PPP Committee and PPP Committee
given responsibility for PPP Unit functions under PPP Act 2004 as enacted (2008)
Project Planning Committee and Public Sector Investment Programme Unit (2008)
[Note: Budget Speech 2008-9 stated that the PPP Unit would prepare the Ten Year
Infrastructure Plan].
22A, the responsible officer may refer the matter to the appropriate Service Commission for
disciplinary action.
Section 2 of the Finance and Audit Act (as amended) defines investment project as an intervention
relating to acquisition and or preservation of non-financial assets for meeting defined objectives
and consisting of a set of interrelated activities to be carried out within a specified budget and a
time-schedule.
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APPENDIX B: Comparison of
Current PPP Policy Statement
(2003) with Contents of
Recommended PPP Policy
PPP Policy Statement 2003 - extracts
Comparison of PPP Policy Statement with what
happened in Mauritius and Recommended
Contents for a Revised and Updated Policy
PPP Definition
PPP Definition
A PPP is a contractual agreement between a
public entity and a private entity, whereby
the private entity performs part of a
government organisation’s service delivery
functions, and assumes the associated risks
for a significant period of time. In return,
the private entity receives a benefit /
financial remuneration according to
predefined performance criteria, which may
be derived:
The definition in the PPP Policy Statement and that
in the PPP Act are different. For example, the
definition in the PPP Act provides that the private
party receives a benefit for performing the
function by way of charges or fees collected by the
private party from users or customers of a service
provided by it. This has a narrow meaning
compared with the definition in the policy
statement because it requires that the private
sector collects the charges or fees which raises
difficulties for classifying an independent power
producer project where payments for power are
made by a distributor who in turn collects service
tariffs from end users.
- entirely from service tariffs or user charges
- entirely from Government budgets
- a combination of the above.
The public sector retains a significant role in
the partnership project, either as the main
It is recommended that a more certain and
comprehensive definition of PPP be included in PPP
legislation that takes into consideration the
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purchaser of the services provided or as the
main enabler of the project. It purchases
services and specifies the service
outputs/outcomes required as well as the
performance criteria for payments. The
private party commonly provides the design,
construction, operation and possibly
financing for the partnership project, and is
paid according to performance. Risks are
identified and placed with the party best
able to bear and manage them at lowest
cost.
diversity of PPP arrangements that may be
required.
A separate table is provided that compares the PPP
definitions in the Policy Statement, PPP Act and
the PPP Guidance Manual of Mauritius with
examples of comprehensive legal definitions of PPP
from South Africa and Ireland.
A wide spectrum of PPP arrangements exists,
differing in purpose, service scope, legal
structure and risk sharing. One end of the
spectrum would be an outsourcing of some
routine operation, while the other could
involve the private sector conceiving,
designing, building, operating, maintaining
and financing a project, thereby taking a
considerable proportion of risk. The choice
of the PPP arrangement for a particular
project will depend on Government’s policy
in the related sector and on potential value
for money to be generated under such an
arrangement.
Reasons for PPP
Reasons for PPP
PPP offers both strategic and operational
choices to Government. Strategically, the
use of PPP fosters economic growth by
developing new commercial opportunities
and increasing competition in the provision
of public services, thus encouraging
crowding-in of private and/or foreign
investment. At the same time, it allows
Government to set policy and strategy, and
where appropriate, to regulate economic
activities, while leaving service delivery to
World Bank PAD for Economic Transition Project
2008 states that private sector participation is
needed to bridge the infrastructure deficit because
of a shortage of Government resources relative to
infrastructure needs. A different view was
expressed by a senior official at MOFEE who
indicated that the Government was interested in
PPP only because of the opportunity to transfer risk
to the private sector and not because of any
financial need on the part of Government.
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the private sector. Operationally, PPP
provides opportunities for efficiency gains
(better quality and more cost-effective
delivery of services), better asset utilisation,
clearer customer focus (since payments are
typically linked to performance rather than
service inputs), and accelerated delivery of
projects.
There should be a clear agreement on the aims and
reasons for pursuing PPP arrangements.
Sectors
Sectors
In the early stages of PPP, Government will
focus on the following key areas of
“infrastructure” means any asset, facility or service
provided for the benefit of members of the public,
or any section of the public and includes, without
limitation those assets, facilities and services listed
in a Schedule to the PPP Act (for example)
development:
- transport
- public utilities (energy and water)
- solid and liquid waste management
- health
- education and vocational training
- ICT
“infrastructure" means facilities and systems
together with any buildings, structures, parking
areas, ancillary facilities and other property
needed to operate a facility including
(i)
Facilities for the provision of power or
electricity (whether provided directly to the public
or to any intermediate entity) including generation,
transmission, distribution and supply and ancillary
facilities including dams for hydro power;
(ii)
Facilities for gas transmission and public
distribution, gas and gas works;
(iii)
Transport includes airport runways, air
traffic control, terminals and other air side and
land side facilities, rail, roads, bridges, highways,
tunnels and other road facilities, port or harbour
facilities on water or land, canals, dams, channel
dredging and terminals, traffic management;
(iv)
Telecommunications includes fixed or
mobile local telephony, domestic long-distance
telephony, and international long-distance
telephony, internet and broadband and facilities
related to the launching, operation or use of
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satellites, broadcasting facilities;
(v)
Facilities, equipment and systems for the
supply, distribution and delivery of potable water,
desalination, water or waste water treatment or
disposal facilities, drainage, irrigation, sewerage
and sewage collection and treatment facilities,
solid waste management including waste collection
and disposal;
(vi)
Real estate, land reclamation projects,
environmental management, remediation and
clean-up projects, urban development, industrial
estates, housing including social housing, street
lighting, government and public buildings including
office accommodation, prisons, courts, sport,
recreation and leisure facilities, tourism
development projects, trade fair complexes,
convention, exhibition and cultural centres, public
markets, gardens and parks, warehouses, property
management;
(vii)
Facilities and services in the health sector
including hospitals;
(viii)
Facilities and services in the education and
training sector including schools, colleges and
residential facilities, training, research and
development
any other project or sector which may be notified
by the Minister responsible for finance in the
Official Gazette.
Preconditions for PPP
Preconditions for PPP
There are thus certain key pre-conditions
which need to be present in the policy
framework for PPP, as they are critical in
delivering successful outcomes. These have
been identified as affordability, the
legislative environment, institutional
arrangements and capacity building.
Risk allocation and transfer, affordability and value
for money should be set out clearly in the PPP
Policy statement and procedures and guidance
developed for carrying out these assessments.
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Affordability
Affordability
Affordability will need to be the cornerstone
of all PPP projects. PPP options must be
affordable both to Government and the
public, given other priorities and
commitments.
The PPP Policy should state how affordability is to
be determined.
Legislative Environment
Legislative Environment
…. new PPP legislation will be enacted to
provide further and concrete evidence of
Government's commitment to its PPP policy
and to provide an opportunity to establish in
law a set of general principles and rules for
PPP procurement that all public bodies will
be expected to comply with, thereby
ensuring some degree of consistency in
approach across sectors.
The PPP Act has failed to deliver PPP projects and
is not an adequate legislative framework for
moving to a PPP programme from a focus on a
limited number of one off PPP projects. The report
compares the content of a comprehensive PPP legal
framework with the patchy framework in Mauritius
that has been subjected to frequent piecemeal
changes. The Report shows the recommended
content for a revised PPP Act.
Institutional Arrangements
Institutional Arrangements
International experience suggests that
identifying and establishing clear and
unambiguous institutional functions in
relation to PPP early on in the onset of a
county’s PPP programme can greatly assist in
successful PPP implementation. At the same
time, it is useful to have a degree of
institutional flexibility in the early years of a
country’s PPP programme, to encourage
experimentation and innovation, and
importantly, to ensure that public bodies
that have capacity are not delayed while
institutional capacity elsewhere is being
developed. While institutional roles and
responsibilities may change over time as
Government’s experience with PPP grows,
the following public institutions will play
important roles in the programme:
Since the PPP Policy Statement was issued changes
have taken place that fundamentally alter the
checks and balance put in place in the policy
statement.
Ministry of Economic Development,
Financial Services and Corporate Affairs
Ministry of Economic Development, Financial
Services and Corporate Affairs (MEDFSCA) through
its recently established PPP Unit, was to be the
driver of PPP policy and responsible for its
development and refinement over time.
Contracting Ministries and other public bodies,
were to play a lead role in the identification,
selection and monitoring of PPP projects in their
sectors. Sectors with capacity will be encouraged
to move forward with their projects, subject to
them being affordable and generating value for
money. Sectors with less capacity will benefit from
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(MEDFSCA) through its recently established
PPP Unit, which will be the driver of PPP
policy and responsible for its development
and refinement over time. As the process
develops and moves into the implementation
stage, the PPP Unit will ensure effective
stakeholder engagement, market interest
and momentum of the process. The PPP Unit
will also support ministries and other public
bodies to ensure that their PPP projects are
carefully appraised, scoped and planned
prior to initiating a procurement process.
Transaction advisers will be recruited as and
when required to assist in this process. As
Mauritius gains experience with PPP, the PPP
Unit will also develop guidelines on best
practices to assist sector Ministries in the
roll-out of their PPP projects.
Contracting Ministries and other public
bodies, which will play a lead role in the
identification, selection and monitoring of
PPP projects in their sectors. Sectors with
capacity will be encouraged to move forward
with their projects, subject to them being
affordable and generating value for money.
Sectors with less capacity will benefit from
the assistance of the PPP Unit and external
transaction advisers.
Ministry of Finance, which will play a key
role in assessing the budgetary implications
of PPP projects. The PPP Unit will work
closely with the Ministry of Finance in the
assessment of PPP project affordability,
value-for-money, feasibility, and contingent
liabilities associated with PPP projects.
the assistance of the PPP Unit and external
transaction advisers.
The Ministry of Finance was to play a key role in
assessing the budgetary implications of PPP
projects. The PPP Unit was to work closely with the
Ministry of Finance in PPP project affordability,
value-for-money, feasibility, and contingent
liabilities associated with PPP projects.
The PPP Act 2004 (proclaimed March 2005) as
initially enacted placed the PPP Unit in the
reconstituted MOFEE working for and with the
Financial Secretary.
The Central Tender Board (as it then was) was
given a major role in the PPP procurement process
alongside the contracting authorities. The Central
Tender Board was not mentioned in the PPP Policy
Statement.
The role of the PPP Unit changed from the PPP
Policy Statement to the PPP Act as enacted. The
Policy Statement saw the PPP Unit as the vehicle
through which MEDFSCA was to drive PPP policy,
supporting ministries and other public bodies to
ensure that PPP projects were carefully appraised,
scoped and planned prior to initiating a
procurement process and assisting sectors with less
capacity to move forward with projects and
working closely with Ministry of Finance in the key
role of the Ministry in assessing PPP budgetary
implications. Instead the PPP Act (as enacted) saw
the PPP Unit as a unit within the Ministry of
Finance that had little or nothing to do with
contracting authorities or projects but with a policy
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development role, carrying out fiscal risk
assessment rather than working closely with the
Ministry of Finance on this subject, an oversight
role developing guidelines and procedures, ensuring
conformity between RFPs and feasibility studies
and public awareness.
The PPP Act as enacted set out the functions of the
PPP Unit as a unit within the Ministry (of Finance)
which shall deal with all matters relating to a
public-private partnership project. The PPP unit
shall (a) make an assessment of a project
submitted to it and give its recommendations to
the Financial Secretary, as to whether the project
(i) is affordable to the contracting authority; (ii)
provides value for money; and (iii) presents
optimum transfer of technical, operational and
financial risks to the private party; (b) examine the
request for proposal to ensure conformity with the
approved feasibility study; (c) advise Government
on administrative procedures in relation to publicprivate partnership projects; (d) develop best
practice guidelines in relation to all aspects of
public-private partnership
(e) formulate policy in relation to public-private
partnership projects; and (f) develop public-private
partnership awareness in the country. The only
other mention of the PPP unit was that a
contracting authority was to submit a feasibility
study to the PPP unit for approval.
The Policy Statement stated that Contracting
Authorities would play a lead role in the
identification, selection and monitoring of PPP
projects in their sectors. It did not expressly state
anything about the process of identifying a partner
for PPP arrangement other than that sectors with
capability would be encouraged to move forward
with their projects subject to affordability and risk
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transfer while sectors with less capacity would
draw on PPP unit and transaction advisers.
The PPP Act as initially enacted provided that the
main players in PPP projects were to be the
contracting authority, the Financial Secretary (who
referred projects which were to be subject to PPP
arrangements to the Central Tender Board) and the
Central Tender Board.
The PPP Act has been amended a number of times
since proclamation in 2005. The role of the
Financial Secretary has been replaced by the PPP
Committee which in turn took over the functions
that had been given to the PPP Unit in the PPP Act
as initially enacted. A 2008 amendment provides
that there is set up a unit within the Ministry to be
known as the PPP Unit which shall deal with
matters relating to a public-private partnership
project referred to it by the PPP Committee.
The PPP Unit no longer has a role in relation to PPP
policy as it only those matters relating to a PPP
project that the PPP unit shall deal with, but
more important as the PPP Committee’s functions
in relation to a PPP project are limited (“make an
assessment of a project submitted to it and give its
recommendations to the relevant contracting
authority”), the matters that the Committee can
refer to the PPP Unit are limited.
The PPP Act as enacted defined “unit” as meaning
“the Public-Private Partnership Unit established
under section 3”. Section 3(1) provides that “there
shall, for the purposes of this Act, be a unit within
the Ministry to be known as the Public-Private
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Partnership Unit which shall deal with all matters
relating to a public-private partnership project....”
Hence the unit was established as an
unincorporated statutory body and not as an
administrative unit of the Ministry created by
administrative means. In practice the PPP unit has
been treated as an administrative unit, in
legislation it is a statutory unincorporated body.
The Business Facilitation (Miscellaneous
Provisions) Act 2006 Act No. 21 of 2006 Section 6
amended the Investment Promotion Act by
inserting Section 18C. Public-Private Partnerships
Notwithstanding the Public-Private Partnership Act
2004, the Board of Investment may act as a
coordinator and facilitator between the PublicPrivate Partnership Unit and the private sector for
the assessment of a public-private partnership
project, its implementation, development and
monitoring. A consolidated version of the
Investment Promotion Act dated August 2009 on
the website of the Board of Investment shows
Section 18C as part of the Act.
The Report sets out detailed Recommendations
PPP Institutional Framework I: Establishment,
functions, powers, staffing, reporting and
accountability of “PPP Unit”, “PPP Steering
Committee”, “PPP Stakeholders Forum”
PPP Institutional Framework II: Roles,
responsibilities and relationships: “PPP Unit”,
“PPP Steering Committee”, MOFEE, Line
Ministries and other Contracting Authorities,
Regulatory bodies, Public Procurement.
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APPENDIX C: Additional
Components of Mauritius’ PPP
Policy Framework - Policy
References to PPP in Recent
Budget Speeches
2006/7 Budget Speech
No reference to PPP.
Extract from 2007/8 Budget Speech referring to PPP
Mr Speaker, Sir, for the first time since Mahé de Labourdonnais, we will build an
entirely new and totally planned city. There are already expressions of interests
from private promoters to build this city in Highlands. When fully built on some 920
Hectares, this city will have the combined size of Quatre Bornes and Rose Hill. It
will accommodate, inter alia, the Knowledge Hub and many Government buildings.
We have made progress on this issue and I am providing for an initial contribution
of Rs 25 million in the Budget to launch this project which will be carried out on a
PPP basis.
Extracts from 2008/9 Budget Speech referring to PPP
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98. To this end, we are reviving the Public Sector Investment Programme (PSIP). The
Public Private Partnership (PPP) Unit will be strengthened to prepare a Ten Year
Infrastructure Development Plan. It will identify and cost the infrastructure needs of the
country and chart the best and most efficient implementation path. [Note: the
strengthening of the PPP Unit did not take place and the development of
infrastructure plans is carried out through a different approach].
99. We are also amending the Public Private Partnership Act 2004 to clarify the
process for unsolicited proposals. This should attract more private capital in public
sector projects.
103. A 12 kilometer Port-Louis Ring Road will be constructed on a PPP basis from
Sor=E8ze to Quay D roundabout including a tunnel of 775 metres through Quoin
Bluff.
104. The Harbour Bridge will also be a PPP project. It will connect Port-Louis at
Royal College to Roche-Bois roundabout. The bridge should divert traffic going
through Port Louis, thus, together with the ring road significantly reducing traffic
congestion at peak hours. Construction works on both ring road and harbour bridge
projects are expected to start in July 2009.
135. We are launching a PPP project at Bigara for 25 to 40 megawatts (MW) of wind
energy. This is expected to cost about Rs 1 billion and should yield 50 to 60 million
kilowatt hours (KWh) representing 3 percent of electricity consumption.
136. The CEB is already operating a 275 KW wind generator in Rodrigues. To
improve capacity in Rodrigues, we are exploring further application of this
technology on a PPP basis.
234. We are revamping, consolidating and strengthening our social housing
schemes. To begin implementation, I am providing Rs 500 million to finance a Social
Housing Fund to be managed by the Ministry of Housing and Lands.
235. This Fund will receive and manage the 1,000 arpents and improve financing for
housing by developing and overseeing a new and ambitious programme to build
new mixed housing communities, on a PPP basis.
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236. On the 1,000 arpents of land, as part of PPP projects, we plan to build about 10
mixed-income communities. Each community will be built as an attractive village to
the new energy savings and environmentally friendly standards. It will also include
cycle tracks, pavements for pedestrians, large inner roads and adequate green spaces
and common areas. In each development, we aim to set aside space for about 200
affordable housing units to be expanded by the owner and 100 serviced plots for
sale. The developer would build housing for the middle class and commercial use
on the remaining land. The Fund would offer a new housing loan to assist in
purchase of land and building. During 2008/09 a first mixed community housing
project will be launched on a pilot basis.
Extracts from July – December 2009 Budget Speech delivered May 2009 referring to
PPP
172. We are also moving forward with PPP projects.
173. Fifteenth, the Tianli project that should bring in some Rs 20 billion of
investment is scheduled to start in September.
174. Sixteenth, the Highlands Project – a modern town on 920 hectares of land has an
estimated cost of Rs 100 billion. It should be completed over the next 10 years. The
project has reached the stage of final selection of the master developer.
175. Seventeenth, the Integrated Mixed Use Development Project at Rose Hill will
include modern Municipal and Arab Town markets, as well as, commercial,
recreational and business space that would enable the centre of Rose Hill to become
a popular shopping cum recreational destination. This project should start by the
end of this year. It would require an investment of some Rs 330 million.
176. Eighteenth, a 25 to 40 MW Wind Park at Bigara, as part of the Maurice Ile
Durable project, will require investment of Rs 1 billion and will be implemented
over three years.
177. Nineteenth, Government also plans a 100 MW Power Plant Project to
consolidate the current capacity expansion plan and to ensure uninterrupted supply
of electricity to the country in the short-to-medium term. This will require an
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investment of Rs 5 billion over three years and will be undertaken on the basis of a
tender for the best technology to meet specified environmental standards.
178. Twentieth, the Local Infrastructure Fund (LIF) has Rs 450 million for projects
that should significantly improve the infrastructure facilities and amenities in towns
and villages. This Fund is financing the construction of market fairs at different
locations including one at Rose Belle at a cost of Rs 88 million. The projects financed
by the LIF will be executed mostly by Small and Medium Contractors. The Fund will
also finance a new waste transfer station which will be built at La Chaumière to
replace the St. Martin Station at a cost of Rs 120 million.
Extracts from 2010 Budget Speech delivered Nov 2009 referring to PPP
110. Twelfth, with respect to Phase II of the Ring Road and the Harbour Bridge, a
financial adviser has been appointed and the final PPP feasibility report will be
ready in the coming weeks. We expect to launch these projects under the Road
Development Company (RDC) in 2010. The RDC will also integrate the Terre
Rouge-Verdun-Ebene road, the BRT track and the whole of the Ring Road.
117. We have also launched the process for a new 100 MW power plant using
environmentally friendly technology that is affordable. This will be a PPP project.
The bids will be prepared on the basis of a report that is being delivered to
Government early next year.
215. Composting will now be done on an industrial scale. A PPP project is being
launched whereby 90,000 tons of municipal waste will be composted every year.
The contract has already been signed and site preparation is beginning within 3
months. Operations are due to start within a year.
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APPENDIX D: Statutory Roles of Government
Institutions Under Current PPP Legal
Framework
Comparison of Statutory Functions, Roles and Relationships of Different Parts of Government in the Mauritius PPP
Process:
This table demonstrates that in the current Mauritius PPP legal framework, the PPP unit has not been granted statutory function or powers. The
sole statutory role of the PPP unit is to “deal with matters relating to a public-private partnership project referred to it by the PPP Committee”. In
turn the PPP Committee can only refer those matters which fall within the limited statutory functions provided to it under the current PPP Act.
PPP Unit
PPP Committee
There is set up for the
purposes of this Act, a unit
within the Ministry to be
known as the Public-Private
Partnership Unit which shall
deal with matters relating
to a public-private
partnership project referred
to it by the Committee.
There shall be a
Committee to be known
as the Public-Private
Partnership Committee
which shall deal with
all matters relating to
a public-private
partnership project.
Contracting Authority
Central Procurement Board
Cabinet
Where the [Financial Secretary] [PPP
Committee] approves the terms of the
model agreement pursuant to section
4(1)(d), the contracting authority shall
submit a request for proposal to the
Central Procurement Board to obtain its
written authorisation to advertise,
invite, solicit or call for bids.
11. Award of project
and signature of
agreement
No contracting authority
shall award a project or
sign an agreement
unless
(a) the award of the
project has been
approved by the
181
PPP Unit
PPP Committee
Contracting Authority
Central Procurement Board
Cabinet
Board; and
(b) the
agreement
relating
to
the
project has been
approved
by
Cabinet.
The Committee shall
(a)
make an
assessment of a project
submitted to it and give
its recommendations to
the relevant
contracting authority;
(b)
develop best
practice guidelines in
relation to all aspects
of public-private
partnership;
(c)
formulate
policy in relation to
public-private
partnership projects;
and
(d)
develop publicprivate partnership
awareness in the
country.
(1)
Subject to
subsection (2), a
contracting authority shall
for the purposes of this
Act
(a)
identify, appraise,
develop and monitor a
project to be
implemented under this
Act;
(b)
undertake or
cause to be undertaken a
feasibility study where it
considers that a project
may be implemented
under an agreement;
(c)
submit the
feasibility study to the
Committee for its
approval;
(d)
prepare a request
for proposal on the
approval of the feasibility
study and, where the
8. Pre-selection of bidders
(1) The contracting authority shall
consult the Board to obtain its written
authorisation to conduct a pre-selection
exercise.
(2) The pre-selection document shall be
prepared by the contracting authority
and shall include a public invitation for
applicants to apply for pre-selection.
(3) Every pre-selection document shall
be subject to the written approval of the
Board before its issue and publication.
(4) The Board shall carry out a preselection exercise to select potential
bidders or may delegate its powers
under this subsection to the contracting
authority where the Board considers that
the contracting authority has the
necessary expertise to undertake the
pre-selection exercise.
(5) In the exercise of its powers under
this section the Board shall strive for the
highest standard of equity by ensuring
182
PPP Unit
PPP Committee
Contracting Authority
Central Procurement Board
terms of the model
agreement impact on
public finance, seek the
approval of the
Committee.
that all bidders are afforded equal
opportunity and are treated fairly.
(2) Any project for which
there is no financial or
contingent liability for
Government shall be
exempt from the approval
of the Committee.
Amended by [Act No. 18
of 2008]
Every contracting
authority shall undertake
or cause to be undertaken
a feasibility study where it
considers that a project
may be implemented
under an agreement, to
assess whether the
proposed project is
feasible as a publicprivate partnership
project.
(2) The feasibility study
shall
(a) demonstrate
comparative advantage in
(6) Notwithstanding subsection (1), a
proposal referred to in section 3C(4)
shall not be subject to a pre-selection
exercise under this section.
Added by [Act No. 18 of 2008]
9.
Invitation to bid
(1) The contracting authority shall
prepare and submit to the Board for its
written approval, a request for proposal.
(2) No document pertaining to a request
for proposal shall be issued to preselected bidders or bidders unless
approved by the Board.
10. Powers of the Board
(1) The Board (a) shall be responsible for ensuring
transparency and equity in the bidding
procedures;
(b) shall examine and evaluate the bids
received;
(c) shall make recommendations to the
contracting authority for entering into
negotiations with the preferred bidder;
183
Cabinet
PPP Unit
PPP Committee
Contracting Authority
Central Procurement Board
terms of strategic and
operational benefits for
implementation under a
public-private partnership
agreement;
and
(b) describe in specific
terms
(i) the nature of the
contracting authority's
functions, the specific
functions to be considered
in relation to the project,
and the expected inputs
and deliverables;
(ii) the extent to which
those functions can
lawfully and effectively be
performed by a private
party in terms of an
agreement; and
(iii) the most appropriate
form by which the
contracting authority may
implement the project
under an agreement;
(c) demonstrate that the
agreement shall (i) be affordable to the
(d) may approve the award of the
project.
(2) In the discharge of its functions
under this Act, the Board may –
(a) commission any study relevant to the
determination of the award of a project;
(b) request any professional or technical
assistance from any appropriate body or
person in Mauritius or elsewhere;
(c) in relation to the examination and
evaluation of bids, refer the bids to the
appropriate contracting authority for
examination and evaluation provided
that the Board is satisfied that the
contracting authority has the necessary
expertise to do so.
(3) Where bids are referred to a
contracting authority under subsection
(2) (c), the contracting authority shall
examine and evaluate the bids and
submit to the Board its findings within
such time as may be determined by the
Board.
(4) The Board may –
(a) request the Chairman, supervising
184
Cabinet
PPP Unit
PPP Committee
Contracting Authority
Central Procurement Board
contracting authority;
officer or chief executive officer of a
contracting authority
(ii) provide value for
money; and
(iii) transfer appropriate
technical, operational or
financial risk to the
private party;
(d) explain the capacity of
the contracting authority
to effectively enforce the
agreement, including the
ability to monitor and
regulate project
implementation and the
performance of the
private party in terms of
the agreement.
(i) to furnish any information or produce
any records or other documents relating
to a project;
(ii) to answer all relevant questions;
(b) to examine such records or other
documents and take copies or extracts
therefrom.
(5) Any person to whom a request is
made under subsection (4) who
(a) fails to comply with the request; or
(b) refuses to answer or wilfully gives
any false or misleading answer to any
question lawfully put by the Board, shall
commit an offence and shall, on
conviction, be liable to a fine not
exceeding 50,000 rupees and to
imprisonment for a term not exceeding 8
years.
(6) Where the Board makes
recommendations in terms of subsection
(1)(c), any change in the terms of the
agreement which impacts on the
approved model agreement shall be
submitted by the contracting authority
to the Committee for the approval of the
185
Cabinet
PPP Unit
PPP Committee
Contracting Authority
Central Procurement Board
changes to be brought to the terms of
the agreement.
Amended by [Act No. 18 of 2008]
(7) Where the Committee approves a
change submitted under subsection (6),
the contracting authority shall seek the
final approval of the Board for the award
of the project.
Amended by [Act No. 18 of 2008]
11. Award of project and signature of
agreement
No contracting authority shall award a
project or sign an agreement unless
(c) the award of the project has been
approved by the Board; and
(d) the agreement relating to the
project has been approved by
Cabinet.
Award of public-private partnership
project. Notwithstanding the provisions
of this Act [Public Procurement Act as
amended by Act 18 of 2008], the Board
(a) shall approve all documents
relating to the bid;
(b) shall authorise, approve and
carry out pre-selection exercise;
(c) shall
authorise
the
advertisement, invitation locally
or internationally, as the case
186
Cabinet
PPP Unit
PPP Committee
Contracting Authority
Central Procurement Board
may be, and call for bids;
(d) shall examine and evaluate bids;
and
(e) may approve the award, of a publicprivate partnership project in the
manner provided for under the PublicPrivate Partnership Act.
187
Cabinet
APPENDIX E: Identification of Current Gaps &
Constraints in Mauritius’ PPP-Related Laws &
Regulations
Issue
1.
Public Private Partnership (PPP) Act
2004
Mauritius Legal Framework
Proclaimed with effect from 1 March 2005 and amended since then, the long title of the Act is to
provide for the implementation of PPP agreements between contracting authorities and private
parties and to establish a set of rules governing PPP.
Comment
2.
PPP Definition (PPP Act)
 The PPP Act 2004, the absence of PPP Regulations made under the PPP Act, the later
enactment of the Public Procurement Act 2006 and Public Procurement Regulations 2006,
amendments in 2008 to the PPP Act and Public Procurement Act result in the legal
framework for PPP being disjointed, incomplete, repetitive in parts and yet not
comprehensive. The PPP Policy Statement was prepared prior to the PPP Act and the Public
Procurement Act and Regulations. The PPP Guidance Manual 2006 was prepared prior to the
amendment of the PPP Act and the enactment of the Public Procurement Act and
Regulations. As a result the PPP Policy Statement and the PPP Guidance Manual are out of
date in terms of descriptions of the project cycle and role of different institutions. The
experience of PPP and capacity to absorb and apply guidance is weak throughout the public
administration. The PPP unit has inadequate financial and human resources and lacks the
status and clout to bring about change.
Section 2 of the PPP Act defines PPP agreement as an agreement between a contracting authority
and a private in which
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Issue
Mauritius Legal Framework
(a). the private party undertakes to perform a contracting authority's function on behalf of the
contracting authority for a specified period;
(b). the private party receives a benefit by way of compensation from a revenue fund, charges or
fees collected by the private party from users or customers of a service provided by it, or a
combination of compensation, charges or fees;
(c). the private party is liable for the risks arising from the performance of its function;
(d). state facilities, equipment or other state resources may be transferred or made available to
the private party. (Presumably “state” is intended to be “State”.).
Section 6 of the PPP Act provides that a contracting authority may enter into an agreement with a
private party for the performance of one or more of the functions of that contracting authority.
Every agreement shall
(a).
(b).
(c).
(d).
(e).
(f).
(g).
(h).
identify the responsibilities of the contracting authority and the private party;
specify the relevant financial terms;
ensure the management of performance of the private party;
provide for the return of assets, if any, to the contracting authority, at the termination or
expiry of the agreement, in such manner as may be provided for in the agreement;
provide for the sharing of risks between the contracting authority and the private party;
provide for the payment to the private party by way of compensation from a revenue fund or
of charges or fees collected by the private party from users or customers of a service
provided by it;
provide for its duration; and
contain such other information as may be prescribed.
Comment
 A PPP arrangement can include an arrangement between a partner and one or more
contracting authorities (e.g. a Ministry and a local authority). In other words it is not
confined to an arrangement between a private partner and a single contracting authority.
 It appears that: (i) each of (a) to (d) in Section 2 are required for a PPP agreement; (ii) a PPP
agreement is an agreement by which a private party agrees to perform a function of a
189
Issue
3.
What sectors or activities are PPP
arrangements permitted or
prohibited by law?
Mauritius Legal Framework
contracting authority (a point referred to below).
 The definition of PPP does not expressly include the provision of a facility or service by the
private sector through a PPP arrangement. A facility or service would need to be a function
of a contracting authority to fall within the meaning of a PPP and for the PPP Act to apply. It
is more usual to refer to entering a PPP arrangement for the performance of functions of a
contracting authority specified in the arrangement in relation to (i) the design and
construction of an asset, together with the operation of services relating to it and the
provision of finance, if required, for such design, construction and operation, or (ii) the
construction of an asset, together with the operation of services relating to it and the
provision of finance, if required, for such construction and operation, or (iii) the design and
construction of an asset, together with the provision of finance for such design and
construction, or (iv) the provision of services relating to an asset for not less than 5 years
and the provision of finance, if required, for such services,
 The provision at (b) in the definition of PPP agreement that a private party is liable for the
risks arising from the performance of its function is unclear because (i) the definition in the
Act refers to the private party undertaking to perform the function of a contracting authority
and not its own function, and (ii) the risks in performing a function are allocated between
the public sector and the private partner – the private partner is rarely liable for all risks
arising from the arrangement. Section 6 says that the agreement provides for the sharing of
risks.
 A “revenue fund” is not defined in the Act.
 Where a function is to be performed by a private partner in a PPP arrangement it is usual to
provide that the function continues to be vested in the contracting authority concurrently
and that Ministerial responsibility to Parliament for a function is not disturbed.
 A comprehensive definition of a PPP arrangement is required.
 It may not be necessary to specify the contents of a PPP agreement in the Act. This would be
better left to regulations, procedures, guidelines, model agreements or compendium of
terms that may be inserted into PPP agreements for a particular project.
The definition of PPP agreement and Section 6 (see above) confine PPP to a function of a contracting
authority performed by a private party.
Comment
190
Issue
4.
Other Definitions (PPP Act)
Mauritius Legal Framework
 It should be clear that PPP is where a contracting authority’s function to deliver a facility or
service is carried out by a private partner. The phrasing in the Act does not make clear that
the function is related to the delivery of a facility or service. It could be interpreted
narrowly as being a statutory function particularly given the omission from the definition of
“contracting authority” of entities such as a Government owned company that do not carry
out a statutory function.
 A definition of infrastructure and a schedule listing the infrastructure facilities and services
in which PPP arrangements may be entered into or prohibited would be beneficial.
Affordable is defined as in relation to an agreement, means that the contracting authority shall
meet any financial commitment likely to be incurred in relation to that agreement, from its existing
or future budgetary funds.
Comment
 “Any financial commitment likely to be incurred in relation to an agreement” includes
financial commitments of the private partner and is not restricted to the financial
commitment of the contracting authority.
 The term “affordability” in a PPP arrangement can extend to the affordability for users when
there is a user charge for the facility or service and this was the meaning given to
affordability in the 2003 PPP Policy Statement.
 It is recommended that terms such as affordable and value for money be defined in
regulations or procedures rather than in the primary legislation (the Act), as with experience
there may be a need to amend the definitions.
The PPP Act defines asset as including an existing asset of a relevant contracting authority or a new
asset to be acquired for the purposes of entering into an agreement.
Comment
191
Issue
Mauritius Legal Framework
 The meaning of the phrase “to be acquired for the purposes of entering into an agreement”
is unclear.
 The definition of asset would more usually state that asset includes an existing asset or an
asset to be provided under a public private partnership arrangement.
 The reference in the PPP Act to the transfer of an asset from a contracting party to a private
partner for the duration of the PPP arrangement might be more explicit. Section 2 PPP
agreement definition means an agreement between a contracting party and a private party
in terms which (d) State facilities, equipment or other State resources may be transferred or
made available to the private party; Section 6(2) states that every PPP agreement must
provide for the return of assets, if any, to the contracting authority, at the termination or
expiry of the agreement, in such manner as may be provided for in the agreement. It might
be more certain to state that a contracting party may (i) transfer an interest, or part of an
interest, in an asset or part of an asset, to the partner, or to a nominee of the partner, or
(ii) take a transfer of an interest of the partner or a nominee of the partner, in an asset or
part of an asset.
“Contingent liability” is defined to include Government guarantee for loan and foreign currency
transfer and step-in function in the event of default by the relevant contracting authority.
Comment
 It is confusing because the guarantee of a repayment of a loan is one form of guarantee.
 A guarantee for foreign currency transfer would appear to be a commitment by Government
(rather than a “guarantee”) that an investor will be permitted to make a foreign currency
transfer or perhaps that convertible funds will be available for a foreign currency transfer.
 The step-in part of the definition is not necessarily a contingent liability. A step in right is a
right of Government or a lender to take the place of the private partner that may be
exercised on the occurrence of an event or events specified in the PPP agreement. The right
to exercise a step in right is contingent on the occurrence of an event but this does not make
it a contingent liability.
192
Issue
Mauritius Legal Framework
Section 5 of the PPP Act sets out that every contracting authority shall undertake or cause to be
undertaken a feasibility study where it considers that a project may be implemented under an
agreement, to assess whether the proposed project is feasible as a PPP project. The feasibility study
shall (a) demonstrate comparative advantage in terms of strategic and operational benefits for
implementation under a PPP agreement; (b) describe in specific terms (i) the nature of the
contracting authority’s functions, the specific functions to be considered in relation to the project,
and the expected inputs and deliverables; (ii) the extent to which those functions can lawfully and
effectively be performed by a private party in terms of an agreement; and (iii) the most appropriate
form by which the contracting authority may implement the project under an agreement; (c)
demonstrate that the agreement shall (i) be affordable to the contracting authority; (ii) provide
value for money; and (iii) transfer appropriate technical, operational or financial risk to the private
party; (d) explain the capacity of the contracting authority to effectively enforce the agreement,
including the ability to monitor and regulate project implementation and the performance of the
private party in terms of the agreement.
Comment
 “Comparative advantage” is not defined – it is assumed that what is intended is that the
project demonstrates more benefits as a PPP project than if procured by traditional public
procurement.
The definition of “request for proposal” in the PPP Act is the specific terms of the project
requirements, the procedures for submission of bids, the criteria for the evaluation of bids and
includes a model agreement.
193
Issue
Mauritius Legal Framework
Comment
 The term “model agreement” is not defined in the PPP Act.
Section 4 provides that the contracting authority shall prepare a request for proposal on the approval
of the feasibility study and, where the terms of the model agreement impact on public finance, seek
the approval of the Committee. A draft agreement that is specific to a project is usually included in
the request for proposals but it would be desirable to have a compendium of terms that could be
used in drafting agreements in a consistent manner.
“Value for money” is defined as the provision by which the contracting authority’s functions under
an agreement shall result in a net benefit to the consumers in terms of cost, delivery, price, quality,
quantity or risk transfer, or a combination thereof.
Comment
5.
PPP Unit Functions (PPP Act)
 The definition does not capture the concept of value for money obtained in procurement by
way of a public private arrangement compared with traditional public procurement.
The PPP Unit in MOFEE is “to deal with matters relating to a PPP project” referred to it by the PPP
Committee. (Section 3 of the PPP Act.)
Comment
194
Issue
6.
PPP Committee Functions (PPP Act)
Mauritius Legal Framework
 This is a vague, general statement of function and responsibility that lacks certainty and
limits the scope and authority of the PPP unit to a degree that makes it ineffective.
 The PPP unit does not have power to act on its own initiative.
 The PPP unit does not have a separate budget for expenditure and does not manage funds
for project development or carrying out PPP feasibility studies.
 Establishing the PPP Unit as a statutory unincorporated body similar in legal status to the
PPO should be considered.
PPP Committee is “to deal with all matters relating to a PPP project”. (Section 3A(1) of the PPP
Act).
Comment
 This statement of function is vague, general and lacks certainty.
The PPP Act provides that the Director of the PPO is a member and Chairman of the PPP Committee
along with a representative of MOFEE, a representative of the Ministry responsible for the subject of
public infrastructure, and a representative of the Attorney-General’s Office. The Committee may coopt such other persons as may be of assistance in relation to any matter before the Committee.
 See below regarding the potentially awkward position that the Director of PPO might be in as
Chairman of PPP Committee.
 It is unclear whether co-opt was intended to mean co-opt as a member of the Committee or
to attend a meeting in relation to a particular matter. It would be unusual to co-opt a person
as a member of the Committee in relation to a particular matter.
Section 3B provides for other functions of the PPP Committee and include functions transferred by
195
Issue
Mauritius Legal Framework
2008 amendment of the PPP Act from the PPP unit namely,
(a).
(b).
(c).
(d).
to assess a project and give recommendations to a contracting authority,
develop best practice PPP guidelines,
formulate policy on PPP projects, and
develop PPP awareness.
Comment
 These functions include activities which a PPP unit would carry out and submit to a PPP
committee for approval.
 The formulating of policy on PPP projects is more usually a matter for a PPP unit or the
Ministry of Finance to prepare and for the Cabinet to approve.
7.
Central Procurement Board (CPB)
PPP Functions (PPP Act and Public
Procurement Act)
The PPP Act (Sections 7-11) provides that where the PPP Committee approves the terms of a model
agreement, the contracting authority shall submit a request for proposal to the CPB to obtain its
written authorisation to advertise, invite, solicit or call for bids. The CPB shall carry out a preselection to select potential bidders or may delegate its powers to the contracting authority where
the CPB considers the contracting authority has the expertise to undertake pre-selection. The CPB
approves all requests for proposals prior to being issued. The CPB is responsible for transparency and
equity in the bidding process, examines and evaluates bids, makes recommendations to the
contracting authority on entering negotiations with a preferred bidder and may approve the award of
a project. If the recommendations on negotiations require the approved model agreement to be
amended, the approval of the PPP Committee for the changes must be obtained. After obtaining the
PPP Committee approval the contracting authority should seek the final approval of CPB for award of
the project. The CPB may commission studies relevant to the determination of the award of the
project, request professional or technical assistance and may refer bids for examination and
evaluation to the contracting authority where it is satisfied of its expertise but in that instance the
contracting authority submits its findings to the CPB. A contracting authority is prohibited from
awarding project or signing an agreement unless the award of the project is approved by CPB (and
the agreement for the project is approved by Cabinet).
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Issue
Mauritius Legal Framework
CPB is established by Section 8 of the Public Procurement Act 2006 as a body corporate, to be
responsible for the approval of the award of major contracts by public bodies. The Public
Procurement Act defines "major contract" as a contract for the procurement of goods or services or
the execution of works (a) to which a public body is or proposes to be a party; and (b) the estimate
of the fair and reasonable value of which exceeds the prescribed amount.
Comment
 See below definitions of public body, works etc in Public Procurement Act.
 The prescribed amount is Rs15m (US$470k) for all procurement by Ministries, Departments,
Local Authorities and for most consultancy contracts. For Goods, Civil Engineering Works &
Capital Goods being procured by parastatals the prescribed amount varies between Rs25m
(US$780k) and Rs50m (US$1.56m).
CPB has a Chairperson, two vice-Chairpersons, and three other persons, having wide experience in
legal, administrative, economic, financial, engineering, scientific or technical matters that hold
office for a period not exceeding 3 years and shall be eligible for re-appointment for one additional
term. The CPB may co-opt other persons capable of assisting it with expert advice but no such
person shall have the right to vote on any matter considered by the Board.
Section 11 of the Public Procurement Act provides for the functions of the CPB. (1) In respect of
major contracts the CPB shall
(a). establish appropriate internal procedures for the operations of the CPB and ensure compliance
with them;
(b). vet bidding documents and notices submitted to it by public bodies;
(c). receive and publicly open bids;
(d). select persons from a list of qualified and independent evaluators maintained by it to act as
members of a bid evaluation committee and oversee the examination and evaluation of bids; and
(e). review the recommendations of a bid evaluation committee and
(i) approve the award of the contract; or
(ii) require the evaluation committee to make a fresh or further evaluation on specified grounds.
(2) The Board shall strive to achieve the highest standards of transparency and equity in the
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Issue
Mauritius Legal Framework
execution of its duties, taking into account
the evaluation criteria and methodology disclosed in the bidding documents;
the qualification criteria and methodology disclosed in the bidding documents;
equality of opportunity to all bidders;
fairness of treatment to all parties;
the need to obtain the best value for money in terms of price, quality and delivery, having
regard to set specifications; and
(f). transparency of process and decisions.
(3) The Board shall have such powers, and exercise such functions, as may be assigned to it under
any other enactment.
(a).
(b).
(c).
(d).
(e).
Section 11A. (inserted by Finance Act July 2008) “Award of public-private partnership project”
Notwithstanding the provisions of this Act, the Board
(a). shall approve all documents relating to the bid;
(b). shall authorise, approve and carry out pre-selection exercises;
(c). shall authorise, the advertisement, invitation locally or internationally, as the case may be, and
call for bids;
(d). shall examine and evaluate bids; and
(e). may approve the award, of a public-private partnership project in the manner provided for under
the PPP Act 2004.
8.
Cabinet PPP Functions (PPP Act)
 Traditional public procurement and procurement by way of a PPP are different in terms of
process and skills and experience in managing the process.
 Evaluation of whether a project should be procured by way of PPP continues up to the final
evaluation of proposals to establish if the best proposal provides value for money compared
with traditional procurement. In traditional procurement the decision to procure is taken
prior to the tender stage of the procurement process.
 CPB has no PPP experience.
 Public Procurement policy and law is moving towards delegated authority to procure under
principles, practices and procedures set out in a coherent legal framework and applied
consistently.
Section 11 of the PPP Act provides that no contracting authority shall award a project or sign an
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Issue
Mauritius Legal Framework
agreement unless the agreement relating to the project has been approved by the Cabinet.
Comment
– It is not stated when this approval must be obtained.
9.
Contracting Authority PPP Functions
(PPP Act and Public Procurement
Act)
A Contracting Authority means any Ministry or Government department, local authority or statutory
corporation (Section 2 of PPP Act) (see below).
 This is the same definition as for public sector agency in the Investment Promotion Act 2000
but it differs from the definition of public body in the Public Procurement Act and the
definition of public sector in the Public Debt Management Act.
Section 4(1) of the PPP Act provides that a contracting authority shall for the purposes of this Act
(a). identify, appraise, develop and monitor a project to be implemented under this Act;
(b). undertake or cause to be undertaken a feasibility study where it considers that a project may be
implemented under an agreement;
(c). submit the feasibility study to the PPP Committee for its approval;
(d). prepare a request for proposal on the approval of the feasibility study and, where the terms of
the model agreement impact on public finance, seek the approval of the PPP Committee .
The PPP Act provides at Section 4(2) that any project for which there is no financial or contingent
liability for Government shall be exempt from the approval of the Committee.
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Comment
 It is difficult to envisage a PPP arrangement which would not have a financial or contingent
liability (in the more commonly accepted usage of this term rather than the definition in the
PPP Act) for Government.
 If a statutory corporation or a company owned by Government has financial resources
available for a PPP arrangement it may be exempt from seeking the approval of the PPP
Committee. It is desirable that Government should have a complete record of all PPP
arrangements and that all PPP arrangements be considered in a consistent manner.
 It is not evident that contracting authorities have the experience or skills to carry out the
responsibilities at Section 4(1).
Section 7 of the PPP Act provides that where the PPP Committee approves the terms of the model
agreement pursuant to section 4(1)(d), the contracting authority shall submit a request for proposal
to the CPB to obtain its written authorisation to advertise, invite, solicit or call for bids.
 The definition of procurement in the Public Procurement Act would imply that a contracting
authority engaged in PPP procurement would be within the meaning of the Act.
Section 50 of the Public Procurement Act provides that (1) every public body shall be responsible for
ensuring that procurement functions are carried out by persons trained and knowledgeable in
procurement, in accordance with guidelines and qualification requirements prescribed or laid down
by the PPO.
(2) every public body shall
(a). engage in procurement planning with a view to achieving maximum value for public expenditure
and the other objectives of this Act;
(b). make an annual plan for budgeting purposes and plan each step of procurement for major
contracts in such manner as may be prescribed.
(3) Every public body shall record and preserve all documentation relating to any procurement
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proceedings in such manner as may be prescribed.
(4) Subject to the Act, all documents, notifications, decisions and other communications referred to
in the Act shall be in writing.
(5) Where it is so prescribed, a public body may authorise the use of other forms of communication,
including electronic communication, for publication of invitations to bid, transmission of bidding
documents, submission of bids, conclusion of contracts and processing of payment.
(6) Where other means of communication are used in accordance with subsection (5), the public
body shall ensure that
(a).
(b).
(c).
(d).
a record of the content of the communication is preserved;
an adequate level of security and confidentiality is provided;
the bidders' access to the records of the procurement proceedings is preserved; and
any other requirement of this Act is complied with.
The Public Procurement Regulations state that (1) A public body shall engage in procurement
planning in order to ensure that procurement is carried out within financial estimates allocated to it.
(2) A public body shall, in respect of every investment project, prepare a master procurement plan
to cover the entire life of the project. (3) A public body shall, at the beginning of every financial
year, prepare an annual procurement plan which shall include
(a) the type and quantity of the goods, works or services to be procured;
(b) the timing and implementation of the procurement;
(c) an indication of possible packages of procurement, and their value;
(d) an indication of possible pre-qualification proceedings and procurement methods to be used;
(e) such other information as may be required in accordance with instructions issued by the PPO.
(4) A public body shall publish on its website an annual procurement plan and periodically update
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and revise it.
(5) In planning procurement for a major contract, a public body shall take into account the following
(a). identification and assessment of the need for the procurement;
(b). designation of procurement planning team;
(c). conducting market research in order to identify various technical solutions, in particular in
the commercial market, to identify the range of available suppliers, and to determine the
most favourable contractual and guarantee terms available in the commercial market that
would be suitable for procurement;
(d). identification of the amount and sources of financing;
(e). studying acquisition history for similar goods, works or services;
(f). defining and describing the procurement requirements;
(g). estimate of the cost of a proposed procurement;
(h). possible aggregation of procurement requirements, taking into account factors such as
achieving economies of scale in purchasing, optimising use of procurement and contract
administration resources;
(i). possible slicing of the procurement into lots, provided that such slicing is not done to avoid
thresholds beyond which more competitive procurement methods may be used, and where
such slicing is indicated by factors such as whether an approach would provide the best
overall value for the public body, possibility of technical compatibility regarding items
purchased in separate lots, the possibility of allowing bidders to bid for individual lots or for
the entire package, and measures to promote participation by small enterprises;
(j). the availability of any procedures for procurement of common-use items;
(k). selection of contracting approach and structure, including verification of possible availability
of framework or indefinite quantity contract arrangements for the item in question;
(l). selection of appropriate procurement method in accordance with sections 15 to 25 of the
Act, and the reasons for use of a procurement method other than open bidding, and any
possible combination and package of task or contract; and
(m). determination and identification of required contract administration resources and
responsibility.
(6) A public body may establish a Committee of Needs in accordance with instructions issued by the
PPO, to plan any individual procurement identified in its annual procurement plan.
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Comment
10. Independent Review Panel (Public
Procurement Act 2006)
 There is a need for certainty for contracting authorities as to the extent to which the Public
Procurement Act and Regulations apply to PPP arrangements and where contradictions or
inconsistencies arise between public procurement and PPP legislation as to what should
prevail.
 Contracting authorities lack experience in conceiving and proposing projects to be evaluated
for procurement by way of PPP. Contracting authorities are experienced in initiating projects
within traditional budget-making and public procurement process. It is only when it is
apparent that resources may not be available for traditional public procurement that PPP is
considered.
Section 44 of the Public Procurement Act 2006 provides that there shall be an Independent Review
Panel which shall consist of a Chairperson and two other persons, having wide experience in legal,
administrative, economic, financial, engineering, scientific or technical matters, who hold office for
three years. During the existence of the first panel one person will be replaced after the first year
and another after the second year, so that over time a regular rotation of persons serving on the
Review Panel will be set up. The Review Panel shall seek to avoid formality in its proceedings and
may conduct them in such manner as it thinks fit.
Section 45 (1) An unsatisfied bidder shall be entitled to ask the Review Panel to review the
procurement proceedings where
(a). the Chief Executive Officer of the public body does not issue a decision within the time specified
(after receiving a challenge to a procurement proceeding);
(b). he is not satisfied with the decision; or
(c). before or after the entry into force of a procurement contract the value of which is above the
prescribed threshold, he is not satisfied with the procurement proceedings on a ground specified
(in the Act)
(2) An application for review under subsection (1) shall
(a). be in writing;
(b). specify the reasons for making the application; and
(c). be made within such time as may be prescribed.
(3) (a)An applicant for a review shall be required to make a deposit as may be prescribed for filing
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the application. (b) Where the Review Panel determines that the application was frivolous, the
deposit made shall be forfeited.
(4) Where an application for review is made in accordance with this section, the procurement
proceedings shall, subject to subsection (5), be suspended until the appeal is heard and determined
by the Review Panel.
(5) The suspension provided by subsection (4) shall not apply where the public body certifies that
urgent public interest considerations require the procurement proceedings to proceed.
(6) A certificate issued by a public body pursuant to subsection (5) shall expressly state the grounds
of the urgent public interest considerations and shall be made a part of the record of the public
procurement proceedings.
(7) A certificate issued by a public body pursuant to subsection (5) shall be binding on the Review
Panel and the procurement proceedings shall proceed unless an application for leave to seek a
judicial review is successful.
(8) The Review Panel shall make a decision under this section within 1 month of the date of
submission of an application for review under subsection (2).
(9) Where the procurement proceedings have not been suspended under subsection (5), and the
application for review of an unsatisfied bidder is determined in his favour, the Review Panel shall
award him compensation limited to the recovery of the costs of bid preparation and participation in
the procurement proceedings.
(10) The Review Panel may dismiss an application for review or may, if it determines that there is
merit in it, order one or more of the following remedies
(a). prohibit the public body from acting or deciding in an unauthorised manner or from following an
incorrect procedure;
(b). recommend the annulment in whole or in part of any unauthorised act or decision of the public
body;
(c). recommend a re-evaluation of the bids or a review of the decision for an award, specifying the
grounds for such recommendation; or
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(d). recommend payment of reasonable costs incurred in participating in the bidding process where a
legally binding contract has been awarded which, in the opinion of the Review Panel, should
have been awarded to the applicant.
Comment
11. Other Legislation Granting Authority
to Enter PPP type arrangements
 As stated above the most appropriate means of achieving the purposes of the public
procurement legislation in PPP procurement should be established with certainty. The choice
is between treating PPP as a special case within PPP legislation or to insert a new part into
the Public Procurement Act on the procurement phase of the PPP project cycle.
The Ports Act 1998 provides at Section 4(1) that it shall be the function and duty of the Mauritius
Port Authority as a landlord port, (d) to enter into concession contracts for the provision of port and
cargo handling services by qualified and licensed operators under such general terms and conditions
as the Authority may determine.
Section 36(1) of the Ports Act provides that the Authority shall, in addition to the powers conferred
and the functions and duties imposed upon it by any enactment exercise regulatory and controlling
functions in respect of the provision of cargo handling services and other related activities in the
ports including loading, unloading, shifting, storage, receipt and delivery, transportation and
distribution. (2) The Authority may enter into concession contracts with qualified and licensed
operators for the provision of port and cargo handling services under such terms and conditions as
the Authority may determine including working hours, the determination of their performance
standards, quality of services provided by them and the enforcement thereof. Section 37(1) The
Authority may at any time suspend or revoke a concession contract or licence upon breach of any
condition of the contract or licence or upon any failure to comply with any provision of this Act or
any regulations made thereunder. (2) Before suspending, revoking or cancelling a licence or a
contract, the Authority shall give written notice of its intention to do so to the licensee or
contractor, stating the reasons for which it proposes to act, and shall give him a reasonable
opportunity of making representations. (3) A licensed operator may appeal to the Minister against
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the suspension or revocation of its licence or contract by the Authority under subsection (1). Section
65(1) The Authority may, with the approval of the Minister, make regulations for the maintenance,
control and management of a port and for the maintenance of good order therein and, generally, for
carrying out the purposes of this Act, and in particular and without prejudice to the generality of the
foregoing power, may make regulations for or in respect of all or any of the following matters.....(g)
concession contracts, licences and leases; and (h) finance, including levying of rates, charges, dues
and fees.
 The term concession contract is not defined in the Ports Act but from the Act can be taken
to mean a form of contractual licence.
 It is desirable that all PPP arrangements being entered into for or on behalf of the
Government be subject to a coherent and consistent legal framework and process.
12. Public Procurement Act and PPP
The Public Procurement Act 2006 long title is “to provide for the basic principles and procedures to
be applied in, and regulate, the public procurement of goods, public works, consultant services, and
other services and for the institutions responsible for those matters”.
Except where otherwise stated the following definitions are in Section 2 of the Public Procurement
Act.
"procurement": the acquisition by a public body by any contractual means of goods, works,
consultant services or other services;
"procurement contract": a contract between a public body and a supplier, contractor or consultant
resulting from procurement proceedings;
"works" means any work associated with the construction, reconstruction, demolition, repair or
renovation of a building, structure or works, such as site preparation, excavation, erection, building,
installation of equipment or materials, decoration and finishing, as well as services incidental to
construction such as drilling, mapping, satellite photography, seismic investigations and similar
services.
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"public body" (a) means any Ministry or other agency of the Government; (b) includes (i) a local
authority; (ii) a parastatal body; and (iii) such other bodies specified in the Schedule; but (c) does
not include an exempt organisation. (See Appendix B)
“parastatal body” is defined in the Public Procurement Regulations 2006 as an organisation
established under an enactment whether body corporate or not and which depends wholly or partly
on government funding.
Comment
 This definition is open to different interpretations. It could be read as confining parastatal
body to an entity founded by its own statute or enactment (a statutory body) or it could be
read as including a company formed under the Companies Act. It is assumed that the former
interpretation is what the Minister had in mind in making the Regulations in which case the
difference between the definition of a contracting authority in the PPP Act and a public body
in the Public Procurement Act is that “contracting authority” (a) does not include a statutory
body that is not a body corporate, (b) there is no provision for including an entity in a
Schedule to the PPP Act, (c) there is no provision for exempting an entity.
"exempt organisation": a body which is, by regulations, excluded from the application of this Act.
The Public Procurement Regulations state that an “exempt organisation” is a public body, as
specified in the First Schedule, which is excluded from the application of the Act.
Comment
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 The Independent Commission Against Corruption is the only body listed in the First Schedule
of the Regulations.
 It appears as though “by regulations” in the definition means regulations made under the
Public Procurement Act and not regulations of the organisation itself.
Comment
 The definitions in the Public Procurement Act result in that Act applying to PPP
arrangements entered into by public bodies. The definition of public bodies differs from that
of contracting authorities in the PPP Act. The term “parastatal body” is not contained in the
PPP Act, is not defined in the Public Procurement Act but is defined in the Public
Procurement Regulations.
(Section 4) provides for the establishment of a Public Procurement Office (PPO) in the Ministry
responsible for finance which has a Director and two other independent persons appointed for a
three year term.
Section 6 sets out the policy-making responsibilities of PPO:
(a). shall serve as an independent procurement policy making and monitoring body;
(b). shall not in any way be operationally involved in conducting procurement proceedings or
resolving procurement disputes; and
(c). may request information from, and consult with, the Board (CPB), the Review Panel, or any
public body in the development of procurement policy for the Government.
(2) In the exercise of its functions the PPO shall act without fear or favour and shall not be subject
to the direction or control of any other person or authority.
The functions of PPO are to:
(a) issue instructions to public bodies concerning the coordination of their actions with the PPO, the
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CPB and the Review Panel;
(b) formulate policies relating to procurement, including directives, procedures, instructions,
technical notes and manuals, for the implementation of this Act;
(c) issue standard forms of contracts, bidding documents, pre-qualification documents, requests for
proposals and other similar documents for mandatory use by every public body implementing
procurement;
(d) collect from the CPB, the Review Panel and public bodies information on procurement activities
and monitor their compliance with this Act;
(da) act as a focal point to guide public bodies with a view to ensuring consistency in the application
of this Act and any regulations made under this Act; ((da) inserted by The Additional Stimulus
Package (Miscellaneous Provisions) Act 2009 – G.N. No. 32 of 2009)
(e) recommend, and facilitate the implementation of, measures to improve the functioning of the
procurement system, including the introduction of information and communications technology and
the dissemination of publications and the setting up of websites dedicated to procurement;
(f) prepare and conduct training programmes for public officials, contractors and suppliers
concerning procurement;
(g) solicit the views of the business community on the effectiveness of the procurement system;
(h) present an annual report to the Minister regarding the overall functioning of the procurement
system;
(i) communicate and cooperate with international institutions and other foreign entities on matters
of procurement;
(j) advise on and monitor foreign technical assistance in the field of procurement;
(k) advise the Financial Secretary regarding delegation of financial authority to public officers
enabling them to approve contract awards and changes to contracts of a financial nature and the
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annual review of such delegations; and
(l) perform such other functions as may be assigned to it by the Financial Secretary.
Section 7A. provides for the powers of the PPO (inserted by The Additional Stimulus Package
(Miscellaneous Provisions) Act 2009 – G.N. No. 32 of 2009)
(1) In the discharge of its functions, the PPO may
(a) request for such information, records and other documents as it may require from any public
body;
(b) examine such records or other documents; and
(c) carry out procurement audit.
(2) Any person to whom a request is made under subsection (1)(a) and who fails to comply with the
request, or wilfully provides false or misleading information, shall commit an offence.
(3) Where, in the discharge of its functions, the PPO finds that there has been a deliberate noncompliance with any provision of this Act or instructions issued, the Director shall refer the matter to
the Head of the Civil Service recommending such action as he may deem appropriate.
(4) The Head of the Civil Service may, where he considers appropriate, refer any matter referred to
him under subsection (3) to the Police for enquiry.
Comment
 The PPP Act provides that the Director of the PPO is a member and Chairman of the PPP
Committee.
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13. PPP Agreement, the PPP Act and
Public Procurement Act
Mauritius Legal Framework
 The PPP Committee is to “deal with all matters relating to a PPP project”.
 The functions of the PPP Committee are to
(a). assess a project and give recommendations to a contracting authority,
(b). develop best practice PPP guidelines,
(c). formulate policy on PPP projects, and
(d). develop PPP awareness.
 The Public Procurement Act provides that where, in the discharge of its functions, the PPO
finds that there has been a deliberate non-compliance with any provision of this Act or
instructions issued, the Director of the PPO shall refer the matter to the Head of the Civil
Service recommending such action as he may deem appropriate.
 Section 12(4) of the Public Procurement Act provides that where it comes to the knowledge
of the CPB that a contract has been awarded or is about to be awarded in breach of this
Part, the CPB shall forthwith report the matter to the Head of the Civil Service, with a copy
to the Director of PPO, recommending such action as it may deem appropriate.
 The duties of the Director of the PPO and the powers and functions of the PPO under the
Public Procurement Act and the functions of the PPP Committee under the PPP Act, place
the Director of the PPO in his role as a member and Chairman of the PPP Committee in a
potentially awkward position.
Section 6(2) of the PPP Act provides that every agreement shall
identify the responsibilities of the contracting authority and the private party;
specify the relevant financial terms;
ensure the management of performance of the private party;
provide for the return of assets, if any, to the contracting authority, at the termination or expiry
of the agreement, in such manner as may be provided for in the agreement;
(e). provide for the sharing of risks between the contracting authority and the private party;
(f). provide for the payment to the private party by way of compensation from a revenue fund or of
charges or fees collected by the private party from users or customers of a service provided by
it;
(g). provide for its duration; and
(h). contain such other information as maybe prescribed.
(3) Every agreement shall be governed by and construed in accordance with the laws of Mauritius.
(a).
(b).
(c).
(d).
(4) Every agreement shall provide for disputes between the private party and the contracting
authority to be settled by arbitration, according to the rules defined in the agreement.
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Section 2 of the Public Procurement Act defines "procurement contract" as a contract between a
public body and a supplier, contractor or consultant resulting from procurement proceedings.
Comment
 Procurement contract includes a project procured under a PPP arrangement.
Section 45(1) of the Public Procurement Act provides that a procurement contract shall include the
terms and conditions that are set out in the bidding documents or request for proposals as well as
(a). the names, addresses and telephone and fax numbers, of the contact persons of the parties to
the contract;
(b). the scope of the work;
(c). the order of priority of contract documents;
(d). the contract price or its mode of determination;
(e). the conditions of acceptance;
(f). the conditions and mode of payment;
(g). the modalities of 'force majeure';
(h). the price adjustment mechanisms;
(i). the provisions for termination of the contract;
(j). the procedure for dispute resolution; and
(k). the applicable law.
(2) Any amendment to the contract, other than changes which do not alter the basic nature or scope
of the contract, shall be expressly agreed by the parties in writing.
(3) An amendment to the contract that will increase the contract value by more than 25% shall
require fresh procurement proceedings except where the amendment must be effected for a reason
specified in section 25(2) (c) or (d) (which specify circumstances in which direct procurement is
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permissible).
(4) No formal amendment of the contract shall be required where the public body wishes to make a
variation or invokes a contract price adjustment which is expressly authorised in the contract.
Comment
14. Is there prior, precise identification
of public bodies with powers and
authority to enter PPP project
arrangements in the PPP Act?
 There is no provision in the PPP Act or Public Procurement Act for a “direct agreement”
between a contracting party and a person who has arranged or provided funding for the
partner for the carrying out of the public private partnership arrangement.
 There is no provision in the PPP Act permitting a contracting authority to form companies or
special purpose vehicles for PPP arrangements.
 The scope of a PPP arrangement should be broader than the performance of function of a
contracting authority and there should be power given to contracting authority to enter
direct agreements with lenders and to form companies or special purpose vehicles to
facilitate and support PPP arrangements.
 Where provision is made for a company or special purpose vehicle to facilitate PPP, the
legislation usually provides for directions to be given as to the corporate governance,
accounting and reporting requirements.
The PPP Act defines “contracting authority” to mean any Ministry or Government department, local
authority or statutory corporation.
Comment
 It does not include companies owned or controlled by the State / Government, or
contracting authority, or entities such as universities or hospitals.
 It is suggested that a broader range of entities should be capable of being a contracting
authority. Otherwise it is possible to for a Contracting Authority to enter a PPP arrangement
by forming a company, or for Government owned companies to enter PPP arrangements
without being subject to the PPP Act although the PPP arrangement could give rise to
express or implied contingent liabilities for the State.
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15. How do public bodies coordinate
with each other in carrying out
distinct functions?
Mauritius Legal Framework
 The Public Procurement Act uses a different definition when it refers to “public bodies”,
while the Investment Promotion Act uses the term “public agencies” and defines it to be the
same contracting authority in the PPP Act.
 The Public Debt Management Act 2008 contains a detailed set of definitions for Government
and its entities:
“public sector” is the central Government, regional Government, local Government; and all
public enterprises.
“general Government” means the central Government, regional Government and local
Government;
“Government” means all Ministries and Departments of the Government;
“central Government” is (a) means all Ministries and Departments of the Government; and
(b) includes (i) entities operating social security schemes; and (ii) agencies responsible for
the performance of specialised governmental functions and operating under the authority of
the Government and which are funded by transfers from the budget and by raising of funds
independently.
“local Government” means the municipalities, district councils and village councils set up
under the Local Government Act and which exercise an independent competence as
government units;
“regional Government” means the Rodrigues Regional Assembly under the Rodrigues Regional
Assembly Act 2001;
“public enterprise” is any institution providing goods and services to the public which is
either Government-owned or Government-controlled, which may be engaged in either the
financial or non-financial sector and which is either entirely or majority-owned or otherwise
controlled by Government or by any other public institution. “Control”, in relation to
Government-controlled, means having an effective influence in the main aspects of
management. “Own”, in relation to Government-owned, means having all or a majority of
the shares or other forms of capital participation.
The PPP Act provides for functions and tasks to be carried out by the Contracting Authority, PPP
Committee, PPP Unit, CPB and Cabinet in the PPP Project Cycle.
The Public Procurement Act provides that the PPO may issue instructions to public bodies concerning
the coordination of their actions with the PPO, CPB and the Review Panel; formulate policies relating
to procurement, including directives, procedures, instructions, technical notes and manuals, for the
implementation of the Act; issue standard forms of contracts, bidding documents, pre-qualification
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documents, requests for proposals and other similar documents for mandatory use by every public
body implementing procurement;
Comment
16. Regulations and the PPP Act
 There is no overall leader, driver and coordinator of the PPP Project Cycle.
 The tasks allocated to individual entities do not reflect the experience and capabilities of
those entities e.g. the CPB has no prior experience in PPP arrangements and yet is given a
key role in the tender / procurement process.
 Section 11 provides that no contracting authority shall award a project or sign an agreement
unless the agreement relating to the project has been approved by Cabinet. But it is not
clear at what stage in the PPP Project Cycle this approval should be obtained.
 There should be provision for written agreements between contracting authority and PPP
Unit regarding roles and responsibilities in procuring PPP project so that a contracting
authority that lacks capacity in PPP can engage the PPP Unit to act on its behalf.
Section 12 provides that the Minister responsible for finance may make such regulations as he thinks
fit for the purposes of this Act and these regulations may provide for the levying of fees and charges.
Comment
17. Regulations and Public Procurement
Act
 No regulations have been made under the PPP Act.
Section 61 of the Public Procurement Act provides that (1) The Minister may, on the recommendation
of the PPO, make such regulations as it thinks fit for the purpose of this Act.
(2) Regulations made under subsection (1) may provide for
(a) detailed procedures;
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(b) competent authorities;
(c) operational thresholds;
(d) an alternative procurement method where any of the procurement methods referred to in
section 15(1) is not considered appropriate for any specific procurement (inserted by Finance Act
July 2008)
(e) time limits and other deadlines; and
(f) the levying of fees or charges by the PPO, the CPB or the Review Panel; and
(g) the amendment of the Schedule.
(3) Regulations made under subsection (1) may provide that any person who contravenes them shall
commit an offence and shall, on conviction, be liable to a fine not exceeding 10,000 rupees (US$330)
and to imprisonment for a term not exceeding 2 years.
18. Transfer of function from a public
authority to a private partner in a
PPP arrangement and PPP Act
19. Transfer of powers and rights to
private partner and PPP Act
20. PPP and Sale or Lease of State Land
Comment
 Section 6 of the PPP Act provides that a contracting authority may enter into an agreement
with a private party for the performance of one or more of the functions of that contracting
authority but it does relate the transfer of functions to the provision of infrastructure
facilities or services.
Comment
 Issues such as compulsory purchase of land for infrastructure, whether a PPP arrangement is
a public purpose for compulsory purchase of land, the right to enter land or easements over
land and the transfer of these rights to a private partner are not expressly referred to in the
PPP Act. The Land Acquisition Act 1982 provides for compulsory purchase of land with
compensation.
Comment
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How the State Land Act and other land legislation interact with PPP projects needs to be examined
further, e.g. the following provisions of the State Land Act 1982. That Act provides that the Minister
responsible for land use may sell State land other than (a) defence lands; (b) mountain reserves
which belong to the State; (c) ‘pas géométriques’; or (d) river reserves which belong to the State. No
State land shall be granted or leased otherwise than at its full rental value but the Minister may (a)
where a portion of State land is bona fide required for religious, charitable or educational purposes,
or for purposes of public utility, grant such land, or lease it, on payment of such rental and on such
condition as he may approve; (b) where a portion of State land is bona fide required for development
purposes, grant such land, or lease it on payment of such rental and on such condition as he may
approve. All sales of State land shall be by public auction. No State land shall be sold unless it is in
the public interest to do so and in exchange of another portion of land. All leases of State Land shall
be (a) by public auction, notice of which shall be given in the Gazette, and two daily newspapers,
two weeks at least before the day fixed for the auction, or by private contract upon such terms and
conditions, not inconsistent with this Act, as the Minister may approve.
21. Procurement Methods (Public
Procurement Act)
Section 15 of the Public Procurement Act provides that (1) Subject to subsection (2), the choice of
procurement methods available to a public body shall be
(a) for the procurement of goods, other services and works, by
(i) open advertised bidding;
(ii) restricted bidding;
(iii) request for sealed quotations;
(iv) direct procurement;
(v) community or end-user participation; or
(vi) departmental execution; and
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(b) for the procurement of consultancy services, by
(i) request for proposals on the basis of
(A) quality and cost;
(B) quality alone;
(C) quality and fixed budget; or
(D) least cost and acceptable quality; or
(ii) direct procurement.
Section 61 provides that The Minister may, on the recommendation of the PPO, make such
regulations as it thinks fit for the purpose of this Act and regulations made under subsection (1) may
provide for an alternative procurement method where any of the procurement methods referred to
in section 15(1) is not considered appropriate for any specific procurement (inserted by Finance Act
July 2008).
Section 15(2)(a) Except in the cases referred to in paragraph (d), procurement shall, in the case of
goods, other services or works, be made by means of open advertised bidding, to which equal access
shall be provided to all eligible and qualified bidders without discrimination.
(b) Open advertised bidding proceedings may include a prequalification stage, or post qualification
procedures, before selection of the winning bidder.
(c) Open advertised bidding proceedings shall be carried out in a single stage or in two stages in the
cases referred to in section 29.
(d) A method of procurement referred to in subsection (1)(a)(ii) to (vi) may be used only if the public
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body has reason to believe that open advertised bidding
(i) will not be efficient or practical for the procurement in question; or
(ii) will be too costly to apply given the value of the procurement.
(e) Where a public body uses a method of procurement other than open advertised bidding or, in the
case of the procurement of consultancy services, a method other than one specified in subsection
(1)(b)(i), it shall note in the record of the procurement proceedings the ground for the choice of the
procurement method.
22. Unsolicited Proposal and PPP Act
Section 3C of the PPP Act provides that (1) Any person may identify a project to be implemented
under an agreement and submit to the contracting authority (a) a description thereof; and (b) an
estimated costs of the feasibility study of the project. (2) The estimated costs referred to in
subsection (1)(b) shall not exceed 3 per cent of the project value and shall be subject to the
approval of the PPP Committee. (3) On receipt of a project under subsection (1), the contracting
authority shall, within 15 working days, refer the project to the PPP Committee together with its
recommendations. (4) Where, pursuant to section 3B(a), the PPP Committee recommends the
retention of the project, the contracting authority shall, within 5 working days, request the person
to submit a proposal in relation thereof, containing (a) details of his technical, commercial,
managerial and financial capabilities; (b) a feasibility study containing the technical and commercial
details of the project; and (c) the nature of information which is proprietary. (5) On receipt of the
proposal referred to in subsection (3), the contracting authority shall proceed in accordance with
section 4(1)(d). (6) The person making the proposal shall be requested in the request for proposal
under section 4(1)(d) to submit only its financial proposal. (7) The contracting authority sha-ll
specify in the request for proposal referred to in section 4(1)(d) [prepare a request for proposal on
the approval of the feasibility study and, where the terms of the model agreement impact on public
finance, seek the approval of the PPP Committee] that in case the price quoted by the person
making the proposal is within the range of 10% when compared with the price quoted by a preferred
bidder, the person making the proposal shall be the preferred bidder. (8) The contracting authority
shall follow the procedures relating to the invitation for request for proposal in accordance with this
Act. (9) Where the person making the proposal under this section (a) is not the successful bidder, the
contracting authority shall (i) compensate the person for the costs of the feasibility study referred to
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in subsections (1) and (2); and (ii) claim such costs from the successful bidder. (b) is the successful
bidder, the costs of the feasibility study referred to in subsections (1) and (2) shall be borne by the
person.
Comment
 The term “unsolicited proposal” is not defined in the PPP Act.
 The fact that a proposal is unsolicited does not mean it cannot enter the PPP Project Cycle
in the same manner and subject to the same scrutiny and competition as a project that is
proposed by a contracting authority.
 When an unsolicited proposal contains a unique element e.g. intellectual property, or
ownership of land in a particular location, limiting the capacity to have fair and open
competition, is when normal procedures cannot be applied.
 The PPP Act is over prescriptive on how to treat an unsolicited proposal.
 There is a need for a more detailed process for distinguishing an unsolicited proposal with a
unique element from an unsolicited proposal which can be treated as if it is a project being
proposed by a contracting authority.
23. PPP Bidding Process (PPP Act and
Public Procurement Act)
Part V of the Public Procurement Act provides for the bidding process for different procurement
methods set out in Section 15 of the Act. The PPP Act provides for feasibility study, pre-selection,
invitation to tender, request for proposals, agreement and award. The PPP Regulations at Regulation
4 under a heading “Bid Evaluation for Major Contracts” states that (1) (a) For the purposes of
examination and evaluation of bids, the CPB shall constitute a bid evaluation committee within 15
days after the opening of bids. (b) A bid evaluation committee set up under paragraph (a) shall be
composed of at least 3 members who are knowledgeable about the goods or services under
procurement and the public procurement procedures. (2) Subject to paragraph (3), the CPB shall
select from a list of qualified and independent evaluators maintained by it to act as members of the
bid evaluation committee. (3) (a) As far as possible, no public officer working in a public body shall
act as member of the bid evaluation committee where the evaluation relates to a procurement in
respect of that public body. (b) No person shall act as a member of the bid evaluation committee
where his participation would constitute a conflict of interest. (4) Where necessary, the CPB may,
following a request from a bid evaluation committee, appoint an adviser or a technical sub -
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committee to assist it. (5) The functions of the bid evaluation committee shall include the
examination, evaluation and comparison of bids and determination of the lowest evaluated
substantially responsive bid for the award. (6) The Chief Executive Officer of the public body
concerned with the procurement shall designate a member of his staff to act as Secretary of the bid
evaluation committee. (7) The members of a bid evaluation committee may be paid such fees as may
be determined by the CPB. (8) The Secretary of the bid evaluation committee shall take minutes of
meetings of the committee and keep record of all matters considered by the committee. (9) The
minutes and other records of the bid evaluation committee shall be open for inspection by the PPO.
 This form of bid evaluation is designed for traditional public procurement and not PPP
procurement. The term “lowest evaluated substantially responsive bid” indicates that price
is the main criterion. In a PPP arrangement, proposals are likely to be complex and difficult
to compare one against the other and require intimate knowledge of the subject matter,
including the PPP feasibility study and other prior work in the PPP project cycle, to be able
to compare value for money in a PPP procurement and traditional public procurement. The
bid evaluation process set out in the Public Procurement Regulations discourages the
inclusion in the bid evaluation committee of a public officer from a procuring public body.
The Public Procurement Regulations set out detailed provisions relating to the procurement bid
process.
24. Is there a legal obligation to apply
wide publicity for projects and
principles of fair, transparent, nondiscrimination in selection process /
bid procedures and requirements?
25. Are process requirements
proportionate to project size and
importance and are they efficient?
26. Are there limited exceptions
allowing direct negotiations and
competitive rules for unsolicited
PPP proposals with safeguards to
Yes: Public Procurement Act and Regulations
Public Procurement Act and Regulations are moving in this direction for traditional public
procurement but special provisions are needed for PPP arrangements
Yes: PPP Act and Public Procurement Act and Regulations but needs to be strengthened.
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ensure limited use, limited duration
of negotiations and full
transparency?
27. Is there a fair but efficient appeal /
challenge process for illegal awards
or aggrieved participants in tender
process?
28. Is there provision for review / audit
of processes and outcomes?
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Yes: Public Procurement Act and Regulations
PPO has a role in procurement process but role of Auditor General in PPP arrangements not specified
in PPP Act.
29. Is there a statutory limit on the
term / duration of a PPP
arrangement?
30. Financing PPP arrangements and
Accounting by public and private
sector
31. Termination / Suspension / Step in
Rights / Rights of different parties
including lenders
32. Who verifies public sector
comparators and value for money
on behalf of Government?
33. Who verifies affordability on behalf
of Government?
No
34. Is there an aggregate fiscal limit on
PPP financial commitments /
contingent liabilities?
35. Is there a veto power for any part
of Government in respect of
projects found not to give value for
money or not to be affordable?
36. Specify role of Government sponsor
of project / procuring entity / PPP
Unit and other entities at all stages
in PPP process including monitoring
Not stated.
No
Step in rights are not mentioned in the PPP Act. Termination
Not stated. The role of the Ministry of Finance should be expressly recognised in the PPP Project
Cycle.
Not stated. The role of the Ministry of Finance should be expressly recognised in the PPP Project
Cycle.
Not expressly stated. Minister for Finance should have this power.
Needs to be developed taking into consideration the strengths and weaknesses of different entities.
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of project.
37. Who has power to give / make
Policy Directives, Regulations and
Guidelines?
38. Disclosure of Interest and
Confidentiality Requirements
39. Disclosure of PPP Arrangements /
Agreements
40. Is there a need for PPP legislation?
41. Foreign and Domestic Suppliers
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Minister has power to make regulations under the PPP Act but has not exercised this power. Under
the Public Procurement Act, the Minister may, on the recommendation of the Policy Office, make
such regulations as it thinks fit for the purpose of the Act which may provide for detailed
procedures, competent authorities, operational thresholds, an alternative procurement method
where any of the procurement methods referred to in section 15(1) is not considered appropriate for
any specific procurement, time limits and other deadlines, and the levying of fees or charges by the
PPO, the Board or the Review Panel, and the amendment of the Schedule. Regulations may provide
that any person who contravenes them shall commit an offence and shall, on conviction, be liable to
a fine not exceeding 10,000 rupees and to imprisonment for a term not exceeding 2 years.
Yes
Yes
PPP primary (Act) and secondary legislation (regulations) as well as procedures and guidelines
derived from authority given by the legislation can provide
(a). express authority to Ministries and Government entities to enter PPP arrangements,
(b). establish PPP institutions and allocate functions and responsibilities in Government
(c). provide a basis for procedures, guidelines and instructions to be applied during a PPP project
cycle
(d). reduce uncertainty for private sector investors and lenders in structuring, finalisation of
agreements, financial closing and implementation of PPP projects
(e). improve credibility of realising PPP potential by giving legal expression to a clear PPP policy
and commitment of Government
The Public Procurement Act provides at Section 17 that A public body may limit participation in open
advertised bidding proceedings to citizens of Mauritius or entities incorporated in Mauritius only
where such limitation is stated in the invitation to bid or, for prequalification, in the bidding
documents and is otherwise in accordance with such criteria as may be prescribed.
The Public Procurement Regulations state at regulation 12 that (1) subject to section 17 of the Act, a
bidder shall be allowed to participate in procurement proceedings without regard to his nationality.
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(2) A public body may accept the submission by a bidder of equivalent documentation when any
document required by the bidding documents is not available or issued, as may be the case in the
bidder’s country. (3) A public body may accept certification from a bidder attesting compliance with
eligibility requirements.
42. Investment Project Process Manual
(IPPM)
The Finance and Audit (Amendment) Act 2008 inserted Section 22A in Finance and Audit Act
(1) The Minister to whom responsibility for the subject of public infrastructure is assigned shall, after
consultation with the Minister, issue instructions including instructions in the form of Investment
Project Process Manual for better
(a) organising the investment projects process;
(b) developing a single window system for approval of projects;
(c) establishing best practices in budget expenditure in respect of investment projects based on
Programme-Based-Budgeting principles;
(d) developing a well defined long-term pipeline of projects;
(e) ensuring active participation of the implementing Ministry or Department in the process leading
to a timely completion of projects within the approved budget.
(2) Every public officer shall, in the performance of his duties, comply with the instructions referred
to in subsection (1).
This Investment Project Process Manual (IPPM) December 2008 was issued by the Ministry of Public
Infrastructure, Land Transport and Shipping. The Manual states that an investment project involves
the procurement of new infrastructure/facilities, significant long-term renewal, improvements to
existing infrastructure/facilities or a combination of these. Typical investment projects include
construction of new buildings, hospitals, roads, power plants, water reservoirs and other
infrastructure items; replacement of old facilities; renovation of existing facilities; acquisition of
new facilities; or purchase of equipment. Investment projects normally are large, non-recurring
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expenditures which involve multi-year funding, have a useful life greater than five years, are based
on a comprehensive needs assessment, meet an essential public purpose, and require public
accountability for funds. An investment project always has direct implications for future operating
budgets. The recurring costs of investment projects on completion will have to be clearly understood
and estimated by Public Bodies before embarking on the decision to go ahead with the projects.
Investment projects may be funded from Government-owned resources, grants or loans from foreign
institutions and/or by the private sector.
43. Utility Regulation
The Utility Regulatory Authority Act 2004 provides for the establishment and management of a
Utility Regulatory Authority, for the regulation of utility services in the interest of customers and
providers of such services. The Authority shall carry out such regulatory functions as may be assigned
to it under the Act or any Utility legislation. The objects of the Authority are subject to the relevant
Utility legislation to
ensure the sustainability and viability of utility services;
protect the interests of both existing and future customers;
promote efficiency in both operations and capital investments in respect of utility services; and
promote competition to prevent unfair and anti-competitive practices in the utility services
industry.
The functions and powers of the Authority are subject to the relevant Utility legislation
(a).
(b).
(c).
(d).
(a)
implement the policy of Government relating to applicable utility services;
(b)
grant, vary and revoke licences in respect of a utility service;
(c)
enforce the conditions laid down in an undertaking authorisation;
(d)
regulate tariffs and other charges levied by a licensee in accordance with any rules specified
in the relevant Utility legislation;
(e)
mediate or arbitrate disputes between a customer and a licensee, or between 2 or more
licensees;
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(f)
determine whether a licensee has an obligation to extend a utility service to customers or to
an area not adequately supplied with such utility service;
(g)
establish an appropriate procedure for receiving and enquiring into complaints by customers
in relation to any utility services; and
(h)
establish and implement adequate systems for monitoring the compliance by licensees with
standards and applicable regulations, and making such information publicly available.
The Authority may do all such things as appear requisite and advantageous in furtherance of its
objects and shall satisfy itself that licensees are able to operate efficiently and to generate revenues
sufficient to finance the provision of utility services.
A "licensee" is defined in the Act as an undertaking which has been granted an undertaking
authorisation under the relevant utility legislation to provide any utility service.
"undertaking” is an enterprise involved in the provision of a utility service;
"undertaking authorisation" is the document pursuant to which a licensee is authorised to provide a
specified utility service;
"Utility legislation" is any legislation specified in Part A of the First Schedule. The Electricity Act is
the only legislation that is specified.
"utility service" is any service specified in Part B of the First Schedule. Electricity services are the
only services listed.
“Electricity services” is defined in the Act as services in respect of the provision of electricity to
customers and includes the generation, transmission, distribution or supply of electricity in bulk or
otherwise.
44. PPP and Guarantees by Government
Section 8 of the Public Debt Management Act 2008 provides that (1) subject to this section, the
Minister may execute, in the name and on behalf of the Government, any instrument required to be
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executed for the purpose of guaranteeing, wholly or partly, the repayment of any money borrowed
by the regional Government, local Government or any public enterprise for any purpose except
current expenditure. Prior to the execution of any instrument under subsection (1), the Minister shall
(a) take into consideration the public sector debt ceiling referred to in section 7 which, by combining
the general Government debt and the other public sector debt, may effectively limit the amount of
guarantees to be given in a fiscal year; and (b) may require the regional Government, local
Government or public enterprise, as the case may be, to furnish proof of its capacity to repay the
money borrowed. (3) The Minister may (a) as a condition of the guarantee, require a public
enterprise to pay an annual fee not exceeding one per cent of the amount guaranteed; and (b) or the
purposes of guaranteeing any money under this section, impose such other conditions in such manner
and on such terms as he thinks fit. (4) Any money, the repayment of which is guaranteed under any
instrument under subsection (1), shall be a charge on the Consolidated Fund and any liability
incurred under it shall be paid out of the Fund. (5) The Ministry shall maintain the official register of
the stock of Government-guaranteed debt. (6) The Ministry shall, not later than one month after the
end of every quarter, prepare a report on the stock of Government-guaranteed debt and the costs
incurred and the estimated costs to be incurred due to realisation of Government guarantees, and
takes steps to ensure that it is made public.
Comment
45. PPP, Debt Management and Fiscal
Risk Assessment
 The term “Ministry” is not defined. “Minister” is defined as the Minister to whom
responsibility for the subject of finance is assigned so it is assumed Ministry is the Ministry
responsible for finance;
 “guaranteeing, wholly or partly, the repayment of any money borrowed by the regional
Government, local Government or any public enterprise for any purpose except current
expenditure” means this provision does not permit a guarantee for payments to a private
partner for the provision of infrastructure facility or service as it applies only to borrowings
by or on behalf of Government, and not to future payments to be made by a Government
entity to a private partner and is not permitted for current expenditure.
Section 10 of the Public Debt Management Act provides that (1) The Ministry shall be responsible for
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the policy framework and strategy governing the management of public sector debt and for ensuring
that the public sector debt is properly managed in accordance with that policy, and in particular,
the Ministry shall (a) be guided by the need to (i) finance the debt at the least possible cost,
consistent with prudent level of risk and the Ministry’s fiscal policy objectives; and (ii) to develop, to
the extent that market conditions, prudence and policy goals permit, a viable interest rate curve for
Government borrowing, using, as appropriate, benchmark issues to help track the prevailing costs of
short, medium and long term financing;
(b) maintain the official register of the stock of public sector debt; (c) study and analyse public
sector debt structure, debt repayment and debt restructuring and any other matter relating to
public sector debt; and (d) monitor public sector debt ceiling referred to in section 7 and guarantees
by Government under section 8. (2) The Ministry shall, for the purposes of this section, set up and
maintain an electronic monitoring system to receive electronic information relating to public sector
debt, from the general Government and public enterprises. (3) The electronic information referred
to in subsection (2) shall include a 3-fiscal year financing plans and debt implications, updated
annually or as required and a quarterly report of actual debt stock shall be made public.
Comment
46. Project Plan Committee (PPC)
 The PPP Act does not expressly provide for the making of an assessment of fiscal risk.
 MOFEE should carry out fiscal risk assessment on individual PPP projects and the PPP
programme. The assessment should be carried out by the debt management unit or some
other part of MOFEE but should not be left solely to the PPP unit.
The PPC is set up in the Ministry of Public Infrastructure, Land Transport and Shipping (MPILTS). The
Permanent Secretary of the Ministry (Public Infrastructure Division) or his representative shall be the
Chairperson. Other members are representative(s) of Ministry of MPILTS, MOFEE, Ministry of
Renewable Energy & Public Utilities – MREPU, Ministry of Housing and Lands – MOHL, Ministry of Local
Government –MLG. The PPC may co-opt representatives from other Public Bodies to assist the
Committee in discharging its functions. The functions of the PPC are:
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assess whether project proposals meet the infrastructure needs of the country,
examine feasibility and cost benefits of infrastructure project proposals,
make recommendations on investment projects for inclusion in the project pipeline,
examine and review specifications,
advise Public Bodies on the appointment of Project Managers,
give clearances on projects whose pre-tender cost estimates exceed the approved cost
estimates,
(g). review the progress of investment projects above Rs100M (US$3.3m) or any priority project
as instructed.
The PPC may also defer a request for future consideration or deny a request and propose possible
alternative, if any.
(a).
(b).
(c).
(d).
(e).
(f).
Each Public Body develops an investment plan comprising a list of projects that would support the
delivery of the output necessary to achieve the goals and objectives in the strategic plan. This list of
projects is an outcome of policies, programme and sectoral needs of the Government. All investment
infrastructure project proposals above Rs25M (US$830k) are reviewed by the PPC, in consultation
with implementing agencies and other concerned Public Bodies prior to the development of a
pipeline of projects. An Investment Project Proposal estimated at below Rs25M does not require the
approval of the PPC but shall be submitted to the MOFEE for approval. If during the pre-bid phase,
the project estimate increases beyond Rs25M, the project shall be considered in the next investment
budgeting cycle, or if there is urgency, it shall require the concurrence of the PPC and the Public
Sector Investment Programme Unit for consideration as an amendment to the investment budget.
47. Public Sector Investment
Programme (PSIP)
 The roles and interaction between different entities involved in PPP and the PSIP process
needs to be streamlined but strengthened.
 The membership of entities that are to act as checks and balances should not unduly overlap
so as to have people involved in committees approving decisions or actions taken by entities
in which the same people participated.
The PPC submits the approved pipeline of projects to the PSIP Unit in MOFEE which prepares the
PSIP. The PSIP covers the investment program of the General Government sector, the Statutory
Bodies, State Owned Companies, the Local Authorities including the Rodrigues Regional Assembly. It
is a rolling investment plan that is reviewed on a quarterly basis against the strategic objectives of
government taking into account, inter-alia, resource availability, state of preparedness of
investment projects and implementation capacity. The PSIP consists of all priority projects to be
implemented in the next 10 years. It is prepared in accordance with national sector strategies,
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programmes and macroeconomic framework. It is a guide to policymakers, development partners,
line ministries/public enterprises and the private partners for informed decisions on those
investment projects that can be funded partly or wholly through public funds, foreign loans/grants
and private capital. Priority is based on preparedness, affordability, and financing secured in the
form of foreign loan, grant facility, etc. Public Bodies prepare a brief for each investment project
setting out:
(a).
(b).
(c).
(d).
(e).
(f).
(g).
48. Project Cycle
Project Title
Project Rationale
Project Description & Objectives
Estimated Cost by component
Project Status
Financing Options
Proposed Disbursement Schedule over the Medium Term
 More emphasis needs to be placed on PPP assessments to identify possible candidates for PPP
arrangements earlier in the project planning process.
(a). A preliminary study is required for all projects above Rs25M (US$830k). For projects above
Rs100M (US$3.3m) or projects high on priority (particularly time sensitive, high risk, or that
incorporating state-of-the-art technology), Public Bodies are required to conduct a
feasibility study. Appropriation is to be obtained through the budget process prior to
proceeding with a feasibility or pre-feasibility study.
(b). Once the project need is established, the funding options for the investment shall be
considered in the following sequence: (1) Private Sector Provision: Public Bodies must first
determine whether this need can be fully met by the market and private operators. (2) PPP:
Public Bodies must fully explore the possibilities of executing projects or delivering public
services through one or more of the financing modes provided for under the PPP legislation,
including the PPP Guidance Manual. The PPP Unit will provide guidance to Implementing
Agencies. (3) Grant: Possibilities for project grant from external development partners may
be explored by the Public Bodies with the assistance of MOFEE. (4) Loans: MOFEE will assist
in exploring possibilities for concessionary loan financing from foreign funding agencies
combined with Technical Assistance. (5) Domestic Loan: Parastatal Bodies and Local
Authorities shall explore possibilities for raising project financing from the market on a nonrecourse basis prior to seeking Government support for funds / guarantees. (6) Government
Own Resources: Funding from Government-owned resources through the Budget shall be
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resorted to only when all other options have been explored and exhausted.
Comment
 In practice it appears that the search for resources takes a different path of identifying if
there are donors grants or loans available and if not to seek Government funding. If no funds
can be found from these sources to consider PPP procurement for the residual projects which
are likely to be among the least attractive projects. The impression is PPP is viewed as a
form of financing projects that cannot get funding from donors / multilateral lenders or
through Government budget, rather than as an alternative to traditional procurement which
would provide better value for money and be affordable to Government.
(c). After the preliminary or feasibility study has been finalised and approved by the Public Body
and funding options explored, the project is submitted with a completed Project Request
Form (see the Investment Project Process Manual) to the PPC requesting inclusion in the
project pipeline.
(d). The PPC rates the projects and establish those that qualify for inclusion in the project
pipeline and for budget support. Once a project passes the evaluation test, budget support
will be extended provided funds are available within the allocated Medium Term Budget
ceiling of the Public Body.
(e). After a project is qualified for inclusion in the project pipeline, the PPC will send its
recommendation to the Minister to whom responsibility for public infrastructure is assigned
to seek approval of Cabinet.
(f). Upon receipt of Cabinet’s approval, the Supervising Officer of the Ministry responsible for
public infrastructure forwards the approval to the PSIP Unit for sequencing / prioritisation of
project pipeline over the medium term to the long term.
(g). Projects already qualified for budget support and required to be included in the coming
budget are reviewed by the Public Body and the MOFEE.
(h). The Public Body sets up a project management team in-house or with professionals engaged
on contract. The Public Body designates an officer with relevant technical competency as
the Project Manager in charge. A resident Project Manager may be appointed on contract
basis with signing authority for the project and responsibility for the management of all the
processes from inception to completion, under terms of reference provided by the PPC. The
Project Manager should be appointed prior to the appointment of the other Consultants. The
Project Manager should produce a detailed project programme to be used as a guide during
the pre-bid and post contract stages. The information contained in the project programme
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will be used by the designers to produce outline proposals. Where applicable the accepted
design will be forwarded to relevant authorities for clearances prior to seeking the approval
of the Building Plans Committee. Once approved, the design will be developed by the design
team. Plans, detailed specification, model or prototype, etc, will be produced and cost
planning and cost control techniques will be applied to ensure that the budget is not
exceeded. A project in which the pre-tender cost-estimate exceeds the approved cost
estimate by 15% shall be referred to the PPC for clearance. Pre-tender cost estimates
exceeding the approved cost estimates by less than 15% shall obtain the clearance of MOFEE.
(i). Bidding documents are prepared in accordance with standard bidding documents issued by
the PPO and submitted to the CPB for vetting, approval and launching of the bid process.
Upon the recommendation of the CPB and in accordance with the provisions of the Public
Procurement Act 2006, the Public Body will award the contract.
(j). The Project Manager and his team monitor and supervise the construction to ensure that the
works are carried out in compliance with the contract documents. Contract procedures must
be followed and any problem dealt with promptly.
(k). A project steering committee should be set up chaired by a supervising officer to follow up
the timely completion of projects.
(l). A quarterly report on the project status and all investment expenditure is to be submitted to
the MOFEE by Public Bodies as part of budget monitoring. Variation in the project cost above
that prescribed in the contract documents requires MOFEE clearance.
Comment
 The PPP Project Cycle and the Project Selection Process through PSIP need to be
coordinated.
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APPENDIX F: Recommended
Approach to Drafting PPP Law
The process of drafting legislation is critical to the effectiveness of the legislation and
to promoting acceptance and understanding of the law among those to whom the
law applies. The process of developing a PPP law should desirably move through a
number of stages that are critical to arriving at an effective law. A successful process
will distinguish the outcome from mere copying of laws from other jurisdictions.
The law must be grafted on to an existing legal framework and institutional system
and must be seen as practicable by those affected by the law and with responsibility
for implementing it.
Understanding: Purposes for which the Law is Required and Context
This is the stage through which we are now moving. The first task in preparing a
law is to properly understand the purposes for which the law is required and the
context in which the law will exist. It is not enough to know that a law is desired. An
understanding of the spirit and intent of the proposals underlying the required law
has to be gained if not already evident. The principal objects of the law must be
clearly understood by legislators and policy makers and fully stated in the draft law.
Unless that understanding of the purpose of the law is accurate and complete the
draft law will lack balance and emphasis and will fail to meet the objectives and
requirements of the Government. Drafting a law with the purpose of circumventing
poor political decision-making or public administration decision-making processes
or seeking to change behaviour is unlikely to succeed unless there is a will within
the political and public administration systems to accept that changes in behaviour
are necessary. Otherwise the political and public administration participants will
ignore the law.
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Implementing Machinery
Precision is needed in providing for the implementing machinery for a law. In
addition to understanding the objects of the law there must be an understanding of
how the law will work in practice. There is a need to move beyond a general desire
to have PPP arrangements towards a deep and comprehensive understanding of the
details and issues that will derive from the draft law. This requires more than stating
the duties, powers and functions of agencies required for the law to work. The draft
law must reflect the administrative machinery that will drive the law. It is important
that this aspect be specified in detail to identify areas of possible conflict between
different parts of Government. Without resolving potential disputes during the
drafting process there will be debilitating battles between different branches of the
Government and wasteful duplication of effort or failure to act. There will also be
confusion and uncertainty for those whom the law is intended to benefit. Avoiding
clarification will result in a negative impact for the achievement of the objects of the
law. Forming committees to camouflage a failure to clearly specify roles and
responsibilities is not a sustainable or efficient approach to public administration.
Analysis
Here the existing law and the implications of the proposals are examined with a
view to identifying problems and issues to be resolved and to ensuring the aims of
the law are achieved.
Existing Law
The PPP law when enacted will be construed alongside other laws of Mauritius, the
common law, case law and Code Civil Mauricien. These implications have to be
identified and addressed to ensure consistency, to ensure that unintended
consequences are avoided and that intended consequences flow. Care must be taken
to respect the Constitution, personal rights and property rights. The legal
competence to carry out what is desired in the PPP law should be established to
avoid state authorities acting ultra vires.
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Minimal Bureaucracy
Avoiding unnecessarily bureaucratic proposals in how the PPP law will operate
should be borne in mind. If not, instead of promoting PPP investment the law will
be an added burden.
Avoid Legal Optimism
The practical aspects of the proposed PPP law must be at the forefront of thought.
Questions to be asked throughout the drafting and consultation are:
Will the approach work?
Is the machinery for implementation adequate?
Will the law win respect?
Is the law capable of being implemented and enforced?
To legislate for a problem does not of itself solve the problem. The law is a
framework for action. It is the practicability and robust nature of the framework and
the competence and efficiency of those given powers, duties and functions under the
law that will determine results. Otherwise the law ends up being mere words on
paper.
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APPENDIX G: Recommended
Contents of The New Draft PPP
Act
The purpose of this Act is to provide for the procurement and delivery of
infrastructure facilities and services through public private partnership
arrangements.
Public private partnerships are arrangements between the public sector and the
private sector for the delivery by the private sector of infrastructure or services,
which traditionally would have been provided by the public sector. Public private
partnerships covered under the Act include arrangements with the private sector
partner in relation to either the design and construction of an asset where operation
is linked to the design and construction element (which may include the provision
of finance), or arrangements to provide services relating to an asset for a period of
not less than 5 years.
The purpose of the Act is to verify that State authorities have the statutory powers to
enter into new procurement arrangements. These powers supplement the existing
powers of State authorities under relevant existing legislation. Traditional public
procurement or out-sourcing under contracting out arrangements for periods of less
than five years are not covered in the Act.
The Act also empowers State authorities to form companies and to enter into joint
ventures for the purpose of a public private partnership and gives State authorities
the legal capacity necessary to contract direct agreements with the private financiers
of public private partnerships.
The Act further provides that the functions of a State Authority may be conferred
under the public private partnership arrangement to the private sector, subject to the
general control of the State Authority. The State authorities and the types of
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infrastructure facilities and services covered by the Act are named in Schedules 1
and 2 respectively.
The Act gives power to a wide range of Government (at national and local level) and
public bodies to enter a public private partnership arrangement with a private sector
partner. The Act provides for the establishment of the Public Private Partnership
Unit of Mauritius (PPP Unit), the Public Private Partnership Committee (PPP
Committee) and the Public Private Partnership Forum (PPP Forum) and their
powers and functions.
The purpose of the PPP Unit is to manage and coordinate the implementation of
PPP policy, programme and projects. The PPP Unit advises and assists State
Authorities in analysing and assessing infrastructure projects with a view to
identifying projects that are to be procured by way of a public private partnership
arrangement rather than by traditional means of public procurement. The PPP
Committee is a four person committee that has a greater range of functions than the
existing PPP Committee and its main role is to oversee the implementation of public
private partnership policy. The PPP Forum provides an opportunity for
stakeholders from outside the public sector to respond and provide
recommendations on PPP matters.
The Act provides for reporting, accountability and transparency in implementing
the PPP programme and procuring PPP projects and includes other provisions to
achieve the purpose of the Act by enabling PPP arrangements to be implemented
efficiently and effectively.
Part I Preliminary
This Part contains a standard interpretation section, defining terms used in the Act.
Part II Public Private Partnership Arrangements
This Part refers to Schedule 1 which specifies an entity or class of entity that is a
State Authority and provides that the Minister responsible for finance (the
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“Minister”) may amend the Schedule to add an entity or class of entity that is
specified as a State Authority.
The Part also provides what is meant by the term public private partnership
arrangement. It provides that subject to approvals and safeguards set out in the Act,
a State Authority may arrange or provide for payments to a private sector partner
and that the State Authority has the power to contract with a person who has
provided (or arranged the provision of) funding for the public private partnership
arrangement. This relates to direct (or ‘‘step-in’’) agreements. An agreement for a
public private partnership arrangement can include provision for the charging of a
user fee, payment by a State Authority or a combination of user fee and payment by
a State Authority. A licence, concession or lease may be granted for the purpose of a
public private partnership but the Act does not apply to the grant of a licence, lease
or rights in respect of matters that are subject to regulation or licensing under
existing legislation.
A State Authority may form a company, or become a shareholder in a company for
the purpose of a public private arrangement and may transfer an asset of the State
Authority to the partner. (This would in effect amend the recent amendment made
to the Statutory Bodies (Accounts and Audit) Act by Additional Stimulus Package
(Miscellaneous Provisions) Act 2009 Act No. 1 of 2009 Government Gazette of
Mauritius No. 32 of 16 April 2009 which provided that 3A. (1) Except where
otherwise expressly provided in the enactment establishing or setting up a statutory
body, the statutory body shall not (a) establish or create any agency or body of
persons, whether corporate or unincorporate; (b) acquire or hold any interest in any
other agency or body of persons, whether corporate or unincorporate.) Under a PPP
arrangement such a transfer would generally be for a defined period only. An asset
could include a series of different assets.
This Part would also provide for the conditions under which a State Authority may
transfer an interest in property to a public private partnership arrangement for the
purpose of enabling the financing of the arrangement.
The functions specified in the public private partnership arrangement may be
conferred upon the partner and may be performed by the partner in its own name
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subject to the control of the State Authority. Notwithstanding this, the functions
shall continue to be vested in the State Authority and the relevant Minister’s
responsibility for the performance of that function is not affected.
An agreement or arrangement entered into prior to the date of commencement of
the Act which would be a public private partnership arrangement or direct
agreement if the Act had been in operation, the agreement or arrangement would
continue to have effect, and if there is an inconsistency between the Act and the
agreement or arrangement, the terms of the agreement or arrangement are to
prevail.
The Act authorises the Minister to give written instructions to a State Authority
which has become a shareholder in a company or formed a company for the
purposes of entering into a public-private partnership
The Act specifies that a project must be analysed, evaluated, approved for
procurement and procured by way of a public private partnership in compliance
with the manner prescribed by subordinate legislative enactment made under the
Act. Procurement of a public private partnership arrangement is distinct from
traditional public procurement and is subject to specialised procurement
requirements that are different from those applied in traditional public
procurement.
The Act imposes an obligation on a State Authority to register a project being
considered for procurement by way of a public private partnership arrangement
with the PPP Unit and to comply with the Act. There should be a central registry of
all PPP projects in order to be able to compile and disclose all liabilities (including
contingent liabilities) and to be able to assess aggregated risks associated with PPP
arrangements.
The Minister would be obliged to publish a statement of payments and receipts,
including contingent payments and receipts, financing support, guarantees and
other support provided by or on behalf of the State in connection with public private
partnership arrangements.
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Part III The Public Private Partnership Unit Of
Mauritius
This Part establishes the PPP Unit and sets out the functions and powers of the PPP
Unit. The PPP Unit is to advise and assist State Authorities on all aspects of public
private partnership arrangements, to act as secretariat to the PPP Committee and the
PPP Forum, to review and evaluate proposals for public private partnership
arrangements, coordinate the implementation of public private partnership policy,
programme and projects by National, Provincial and Local Level Government and
State Authorities. The PPP Unit is given powers to carry out its functions including
power to issue procedures, guidelines and instructions.
The PPP Unit is to obliged by the Act to prepare a Code of Practice relating to the
conduct of its management, staff and advisers and others involved with public
private partnership arrangements.
The Act provides for the appointment, powers and responsibilities of a Chief
Executive Officer of the PPP Unit. The Chief Executive Officer will manage and
control generally the administration and business of the PPP Unit and the staff of the
PPP Unit. This section also provides for the delegation of the Chief Executive
Officer’s functions. It provides for the appointment of an Acting Chief Executive
Officer in certain circumstances. The Chief Executive Officer holds office on terms
and conditions as may be determined by the Minister subject to any other
requirements relating to pay and conditions. The Chief Executive Officer is directly
responsible to the Minister for the performance of the functions of the PPP Unit.
The Act should provide for PPP Unit employment. The Chief Executive is to
determine the number of employees and terms and conditions of employment with
the approval of the Minister.
The PPP Unit should be permitted to enter into administrative arrangements with
State Authorities or with regulatory or other public bodies to enable the PPP Unit
carry out its functions.
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The PPP Unit should have authority to issue procedures, guidelines or instructions
with the approval of the Minister and the PPP Committee.
The Act should provide for the procurement of goods and services by the PPP Unit
including procurement of consultancy services by establishing a panel if this is not
permitted under the Public Procurement Act 2006.
Detailed requirements for the reporting and corporate planning of the PPP Unit
should be contained in the Act.
The Act should state the broad governance arrangements of the PPP Unit, with the
management and administration of the PPP Unit subject to the control and general
superintendence of the Minister, whilst the PPP Unit reports to the PPP Committee
on PPP policy, programme and projects. The Minister may give general directions to
the PPP Unit on matters of policy but not in relation to particular projects or
partners. All directions from the Minister must be published and the PPP Unit is to
state what action it takes in response to directions.
Part IV Financial Reporting Accounting and
Auditing
The Act should set out the requirements of the PPP Unit in terms of the preparation
of accounts, and specify that the PPP Unit funds may consist of appropriations by
Parliament, grants and subscriptions, receivables for goods and services, fees or
levies. Expenditure is restricted to the payment of staff and other expenses of the
PPP Unit and purposes consistent with the functions of the PPP Unit. The PPP Unit
has power to open, manage and operate a bank account. Monies payable to the PPP
Unit are in the nature of a conditional grant and if not expended may be required to
be returned to Consolidated Revenue.
The Act should give power to the Auditor General to audit and report on a public
private partnership arrangement and the process by which an arrangement has been
procured as well as assessing whether the arrangement is realising the objectives
that led to the procurement decision.
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Part V Public Private Partnership Committee
The Act would establish the PPP Committee as a supervisory committee for public
private partnership. The PPP Committee is comprised of the members such as
Financial Secretary, State Law Office, Secretary Infrastructure etc. The Chief
Executive Officer of the PPP Unit can attend all meetings as an adviser and observer
but not as a member. The PPP Committee may co-opt a Secretary of a Ministry to be
a member of the PPP Steering for a specified period and may invite persons to
attend meetings. The PPP Unit is secretariat for the PPP Committee.
The Act provides for meetings of the PPP Committee including quorum and a
requirement to keep minutes and for decisions of the PPP Committee to be taken
without meeting and for a separate record of these types of decisions to be kept by
the Chief Executive Officer.
The Act sets out the functions of the PPP Committee. These include coordinating
and monitoring the PPP policy and programme and reporting to and advising the
Cabinet. The PPP Committee make appointments to PPP project teams and proposal
evaluation teams and makes recommendations to the Cabinet on procurement of a
project by public private partnership arrangement.
The PPP Committee has the power to do all things necessary in connection with its
functions.
The PPP Committee may establish committees, appoint members and specify
functions and procedures for the purpose of advising on the performance of its
functions.
The PPP Committee may delegate functions or powers to the Chief Executive Officer
or other person.
Part VI PPP Forum
The Chief Executive Officer would be obliged by the Act to convene a PPP Forum
for discussion and exchange of views among persons in society, business and
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government involved with PPP policy and projects. The Chairman of the PPP Forum
is to be from the private sector. The PPP Forum will meet as often as needs be and
will make proposals and suggestions for improving PPP as well as giving the PPP
Unit the opportunity to inform the PPP Forum of activities and developments. The
PPP Unit will act as secretariat to the PPP Forum. The purpose of the PPP Forum is
to provide an opportunity for all persons in society, business and government that
are involved with, may be affected by or have an interest in the procurement or
development of infrastructure by way of public private partnership arrangements
and the implementation of PPP projects (in this Section called “stakeholders”) can
meet to discuss and exchange views on relevant issues.
Part VII Miscellaneous
The Act provides for disclosure of interests by those involved in advising or making
decisions on public private partnership arrangements.
It also provides for the confidentiality of information obtained in confidence when
performing functions under the Act.
The Act provides for an offence of lobbying in connection with decisions on matters
connected with public private partnership arrangements.
The Act provides for legal proceedings involving the PPP Unit with an immunity
provision that states that a person acting for the State, State Authorities, the PPP
Unit, the PPP Committee or the Minister is not personally liable for matters done or
omitted in good faith in the exercise of powers or functions under the Act. The
validity of any act or decision taken prior to the coming into operation of the Act is
not affected by the Act.
The Act would provide for the Minister responsible for finance to have power to
make regulations for the purposes of the Act.
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APPENDIX H: TERMS OF
REFERENCE FOR RESIDENT
PPP ADVISER
Terms of Reference for a Resident Public-Private Partnership (PPP) Adviser
Summary & Background Information
The Government of Mauritius seeks to hire a Resident Public-Private Partnership
(PPP) Adviser to serve for a minimum period of 2-years in its PPP Unit within the
Ministry of Finance and Economic Empowerment (MOFEE). The PPP Unit is
focusing on expanding investments in the country’s infrastructure sectors through
PPP arrangement. A pipeline of pilot PPP projects have already been identified in
sector including energy, transportation, water, wastewater, public facilities, waste
management, fisheries, and other sectors.
The MOFEE is also strengthening the legal and institutional framework for PPPs in
Mauritius, to be support the preparation and completion of these transactions.
Candidates interested in learning more about the existing framework for PPPs as
well as the key initiatives to strengthen and expand it are encouraged to visit the
PPP Unit’s website at: http://www.gov.mu/portal/sites/ncb/ppp/about.htm
Responsibilities of the Resident PPP Adviser:
The primary goal of the Resident PPP Adviser will be to oversee the preparation and
completion of a growing portfolio of PPP transactions in Mauritius. The Adviser
will be overseeing and managing teams of PPP project consulting and transaction
advisory firms and individuals who will be carrying-out specific PPP feasibility
studies, and preparing and implementing PPP tenders. A key purpose of this
position will be to transfer important PPP transaction oversight and management
skills, models, and procedures to other members of the PPP Unit Team. When
available, the Resident PPP Adviser will be expected to advise on the PPP Unit’s
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other activities, such as strengthening the PPP legal and institutional framework,
and conducting PPP capacity-building events.
Primary Responsibilities:
o Identifying new PPP projects in Mauritius
o Screening identified projects for the suitability to be analyzed as PPP
candidates;
o Preparing terms of reference of PPP consultants and transaction
advisers to conduct PPP project screening analyses, feasibility studies,
tenderings, and other specific tasks;
o Reviewing PPP consultant and transaction advisor qualifications and
proposals and selecting preferred bidders
o Supervising and reviewing PPP feasibility analyses, including Public
Sector Comparison (PSC) and Value for Money (VfM) analyses, and
PPP project risk-allocation structures;
o Supervising and reviewing PPP transactions through tendering and
financial closure;
o Evaluating PPP proposals from private developers
o Communicating with private lenders and investors on PPP investment
requirements, financing strategies, and opportunities
o Designing, drafting and establishing key models, documents, and
standardized procedures for the PPP Unit to screen, analyze, structure,
tender, complete, and monitor PPP transactions.
Secondary Responsibilities:
o When available, the Resident PPP Adviser will be expected to provide
advice on specific issues regarding the on-going development and
strengthening of Mauritius’ legal, institutional, and procedural
framework for PPPs
o When available, help with important PPP communications, including
presenting at PPP training, and capacity-building events
o Communicating with commercial banks investors, especially local
banks and investors, to enable appropriate financing instruments for
long-term PPP investments in Mauritius
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This Resident PPP Adviser position is for a minimum term of 2-years.
Selection Criteria:
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Minimum of 10 years experience with analyzing, structuring, and financing
public-private partnership (PPP) infrastructure investments, including:
o Experience with preparing, structuring, and negotiating limitedrecourse project financing transactions
o Experience with preparing or bidding on international competitive
procurements for large capital investment projects
o Experience in appraising investment projects, such as conducting
due diligence reviews for investors and lenders
o Strong quantitative experience with designing and reviewing
financial feasibility studies and tariff-setting analyses for long-term
infrastructure investments.
Experience with conducting and reviewing Public Sector Comparison (PSC)
and Value for Money (VfM) analyses for large investment projects
Advanced degree or Charter in finance, investments, or economics preferable
Experience with advising on PPP policies, institutional development, legal &
regulatory frameworks, and training is helpful
Demonstrated ability to work with Ministry of Finance decision-makers and
donor organizations alike
Ability to conduct on-the-job training and to transfer key PPP project and
transaction management skills to other members of the PPP Unit Team.
A strong team player with excellent interpersonal skills and the ability to
work in a high profile environment;
Strong oral and written communication skills with a capacity to communicate
effectively to a wide variety of audiences, including conducting periodic
presentations;
Fluency in English is required; Proficiency in French is highly useful
Instructions:
Interested candidates for this position should submit:
1. A detailed curriculum vitae showing the dates and organizational titles for all
relevant employment and assignments
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2. A statement of interest showing how that candidate’s experience meets the
selection criteria and describing what their candidacy can offer the PPP Unit for
this important position
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APPENDIX I: TERMS OF
REFERENCE FOR A PPP
FRAMEWORK DEVELOPMENT
& CAPACITY-BUILDING
MANAGER
Terms of Reference for PPP Unit Staff:
PPP Framework Development & Capacity-Building Manager
Summary & Background Information
The Government of Mauritius seeks to hire a PPP Framework and CapacityBuilding Manager in its Public-Private Partnership (PPP) Unit within the Ministry of
Finance and Economic Empowerment (MOFEE). The MOFEE is currently
strengthening the legal and institutional framework for PPPs in Mauritius, to better
support the preparation and completion of PPP transactions to expand economic
infrastructure. A pipeline of pilot PPP projects has already been identified in sector
including energy, transportation, water, wastewater, public facilities, waste
management, fisheries, and other sectors.
The development of the PPP framework includes a program to develop the
knowledge, skills, and capacity of key public sector bodies to identify and
implement PPP projects. Candidates interested in learning more about the existing
framework for PPPs as well as the key initiatives to strengthen and expand it are
encouraged to visit the PPP Unit’s website at:
http://www.gov.mu/portal/sites/ncb/ppp/about.htm
Responsibilities of the Resident PPP Adviser:
The primary goal of the PPP Framework Development & Capacity-Building
Manager will be to oversee a program of activities covering two related areas:
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1. Activities to strengthen Mauritius PPP policies, laws, regulations, and
institutional arrangements
2. Activities to train and build the capacity of Mauritius’ public sector bodies
and staff to initiate and implement PPP projects
For many of these activities the Manager will be overseeing PPP legal, institutional,
and training specialists.
PPP Legal & Institutional Framework Responsibilities:
o Managing the PPP Unit’s work plan of activities in strengthening the
legal & institutional framework
o Coordinating the development, drafting, communication, and
adoption of a strengthened PPP policy statement
o Coordinating the development, drafting, communication, and
adoption of a strengthened PPP Act and associated implementing rules
and regulations
o Coordinating the development of the PPP Unit’s organizational
procedures, including the development an updated Manual of PPP
Guidelines
o Coordinating the establishment of a PPP Forum of key public and
private sector leaders to ensure better communication and cooperation
on PPPs in Mauritius
o Preparing terms of reference for and overseeing the activities of PPP
legal and institutional specialists engaged to assist the PPP Unit’s
framework development activities
o Overseeing the operation of the new Panel of PPP Experts
o Communicating with public and private sector leaders and the press
on Mauritius’ PPP framework.
PPP Training & Capacity-Building Responsibilities:
o Managing the PPP Unit’s work plan of activities in building the
knowledge and capacity of public sector institutions to implement PPP
projects
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o Assessing the PPP training needs of individual ministries, contracting
authorities, and public corporations as related to specific, proposed
PPP projects
o Coordinating the planning and implementation of PPP training
projects sponsored by the PPP Unit, including general workshops,
study tours, international development, online courses, and other
training events
o Working with other training organizations in Mauritius as well as
internationally to assess their abilities to provide the kind of PPP
training and capacity-building sought by the PPP Unit
Selection Criteria:
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Minimum of 8 years of international experience advising on the development
of PPP policies, laws, regulations, and institutional frameworks
Experience with organizational development management
Minimum of 5 years of experience in the management of professional training
Experience with conducting training needs assessments
Experience with design and teaching in professional training workshops
Experience overseeing and managing specialized consultants working on
policy, legal, and organizational development projects
Ability to conduct on-the-job training and to transfer key PPP framework
development and training management skills to other members of the PPP
Unit Team.
Experience working with governments, multilateral development banks,
private sector, and other stakeholders on policy, legal, institutional
framework and capacity-building projects
Advanced degrees such as Masters of Public Administration (MPA), Law
(JD), or economics is desirable
A strong team player with excellent interpersonal skills and the ability to
work in a high profile environment;
Demonstrated ability to manage stakeholder consultation initiatives,
including build and maintain effective relationships with colleagues and a
wide range of external parties;
Fluency in English is required; Proficiency in French is highly useful
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Instructions:
Interested candidates for this position should submit:
1. A detailed curriculum vitae showing the dates and organizational titles for all
relevant employment and assignments
2. A statement of interest showing how that candidate’s experience meets the
selection criteria and describing what their candidacy can offer the PPP Unit for
this important position
251
APPENDIX J: Terms of Reference
for Short-Term Consultant to
Support Launching of Panel of
PPP Experts
Terms of Reference for Short-Term Consultant:
Procurement & Public-Private Partnership (PPP) Specialist for Launching the
Panel of PPP Experts
Summary & Background Information
The Government of Mauritius seeks to hire a short-term Consultant to support its
Public-Private Partnership (PPP) Unit of the Ministry of Finance and Economic
Empowerment (MOFEE) to launch its Panel of PPP Experts. The MOFEE is
currently strengthening the legal and institutional framework for PPPs in Mauritius,
to better support the preparation and completion of PPP transactions to expand
economic infrastructure. A key priority is the establishment of a “Panel” of prequalified PPP experts to carry-out a range of PPP-related tasks including serving as
PPP transaction advisors, conducting PPP project feasibility studies, conducting PPP
training, etc. Having this Panel of PPP Experts available, whose qualifications have
already been accepted, will enable PPP projects to be prepared and completed more
efficiently.
Candidates interested in learning more about the existing framework for PPPs as
well as the key initiatives to strengthen and expand it are encouraged to visit the
PPP Unit’s website at: http://www.gov.mu/portal/sites/ncb/ppp/about.htm
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Responsibilities of the Short-Term Consultant:
The PPP Unit and the PPP Committee which oversees it have adopted the principles
for establishing a Panel of PPP Experts. This includes the outlines for the contents of
a Request for Qualifications (RfQ) document for the Panel, as well as an Operational
Guide for the Panel. The Consultant will support the Head of PPP Unit in the
completion of the following specific tasks:
1. Complete the drafting of the Request for Qualifications (RfQ) document
for the Panel. This will include both the specific skills and qualifications
being sought, the criteria for their evaluation, and instructions to firms for
submission. The Consultant will be following an outline for the RfQ that the
PPP Unit has already developed.
2. Complete the drafting of the Operational Guide for the Panel. This
document describes both firms interested in being on the Panel, as well as for
Government stakeholders how the Panel will function and what its rules of
operation are. The Consultant will be following an outline for the RfQ that
the PPP Unit has already developed
3. Draft the Marketing Plan for launching the Panel. The marketing plan
should identify how the RfQ will marketed and advertised to firms both in
Mauritius as well as internationally. It will specify the media & venues to be
used (webpage, newspapers, email campaign, Pre-Bid Conference, etc.) to be
used and the deadlines for their completion
4. Implementing the Marketing Plan: This will include publication of
Announcement for the Panel, distribution of the Announcement through the
identified media and mechanisms, responding to questions and inquiries
from interested firms, managing a Pre-Qualification Conference for interested
firms
5. Receiving and Evaluating Submitted Qualifications: It is expected that
several dozens of consortia of firms may submit technical qualifications and
proposed rates to be on the Panel. The PPP Unit will need to quickly evaluate
and score these qualifications and announce the final list of Panelists. The
Consultant will play an important role in the evaluation process within the
PPP Unit.
Selection Criteria:
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Minimum of 5 years of experience in the management of technical
assistance and consulting projects for Governments, international
donors and/or corporate clients.
Experience in the tendering and procurement for consulting and
advisory services, including procedures, regulations, documentation,
and requirements.
Knowledge of Public-Private Partnerships (PPPs), including the steps
required in preparing and implementing PPP projects.
Strong writing abilities to draft key documents, such as a Request for
Qualifications (RfQ) document and an Operational Guide.
Experience with marketing initiatives, including using webpage
announcements, email campaigns, newspapers & industry
publications, bidders’ conferences and other media to promote
business opportunities.
Experience with evaluating professional qualifications and cost
proposals and consulting rates for providing advisory services
Ability to develop practical solutions to important institutional and
procedural challenges
Fluency in English is required; Proficiency in French is highly useful
Instructions:
Interested candidates for this position should submit:
1. A detailed curriculum vitae showing the dates and organizational titles for all
relevant employment and assignments, and brief descriptions of responsibilities
and roles.
2. A statement of interest showing how that candidate’s experience meets the
selection criteria and describing what their candidacy can offer the PPP Unit for
this specific assignment.
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APPENDIX K: TERMS OF
REFERENCE FOR PPP UNIT
CHIEF EXECUTIVE
Terms of Reference for PPP Unit Staff:
PPP Unit Chief Executive
Summary & Background Information
The Government of Mauritius seeks to hire a Chief Executive for its Public-Private
Partnership (PPP) Unit within the Ministry of Finance and Economic Empowerment
(MOFEE). The MOFEE is currently strengthening the legal and institutional
framework for PPPs in Mauritius, to better support the preparation and completion
of PPP transactions to expand economic infrastructure. A pipeline of pilot PPP
projects has already been identified in sector including energy, transportation,
water, wastewater, public facilities, waste management, fisheries, and other sectors.
Candidates interested in learning more about the existing framework for PPPs as
well as the key initiatives to strengthen and expand it are encouraged to visit the
PPP Unit’s website at: http://www.gov.mu/portal/sites/ncb/ppp/about.htm
Responsibilities of the Chief Executive:
The Chief Executive will oversee all activities and all staff of the PPP Unit. For most
of these activities the Chief Executive will be overseeing the PPP Unit staff and
specialists, including a Resident PPP Adviser as well as a PPP Framework
Development and Capacity-Building Manager. Responsibilities of the Chief
Executive will include:
Responsibilities:
o Overseeing the execution of the PPP Unit’s entire work plan of
activities, including the preparation and completion of PPP
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o
o
o
o
o
o
o
o
transactions, the strengthening the legal & institutional framework,
PPP capacity-building, and other special PPP initiatives.
Ensuring that the Government’s overall process of preparing,
structuring, approving, tendering, awarding, and signing PPP
contracts is effective and efficient.
Supervising the Resident PPP Adviser’s coordination of the PPP Unit’s
project identifications, screening, feasibility analysis, tendering, and
completion of PPP projects and transactions
Supervising the PPP Framework Development & Capacity-Building
Manager’s coordination of the PPP Unit’s policy, legal, institutional,
and capacity-building initiatives.
Executing the management of the PPP Unit’s budget and reporting
functions
Officially representing the PPP Unit on its Governmental Committees,
including specific PPP project committees, the PPP Forum, special
training & capacity-building events sponsored by the PPP Unit, etc.
Ensuring the effective knowledge-transfer and on-the-job-training
occurs from the Resident PPP Advisor and any other PPP specialists to
the staff of the PPP Unit, to ensure the long-term capacity of the PPP
Unit as an institution.
Effectively representing the PPP Unit to private infrastructure sector
investors and lenders interested in bidding on PPP opportunities.
Communicating with public and private sector leaders and the press
on Mauritius’ PPP framework and PPP projects.
Selection Criteria:



Minimum of 10 years of experience working with Government decisionmakers on investment projects, including the analysis, review, approval, and
tendering, of large capital projects
Minimum of 5 years of experience in managing and directing organizations,
including overseeing specialized staff, managing budgets, managing
corporate work plans, and reporting to oversight bodies.
Experience working on the development of PPP policies, laws, regulations,
and institutional frameworks
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






Experience working with private investors and lenders on investment
projects and the ability to understand and address private investor concerns
and requirements for long-term investments is highly desirable
Broad ability to review and seek resolutions to broad range of PPP-related
issues and disciplines, including: public policy, institutional decision-making,
procurement, law, finance & investments, and technical issues in
infrastructure sectors.
Ability to oversee on-the-job training and to knowledge-transfer activities to
ensure that key PPP management skills are developed both within the PPP
Unit and elsewhere in the public sector.
Advanced degrees such as an Masters of Public Administration (MPA), Law,
or economics is desirable
A strong leader and manager with excellent interpersonal skills and the
ability to work in a high profile environment;
Demonstrated ability to build and maintain effective relationships with
colleagues and a wide range of external parties;
Fluency in English is required; Proficiency in French is highly useful
Instructions:
Interested candidates for this position should submit:
1. A detailed curriculum vitae showing the dates and organizational titles for all
relevant employment and assignments
2. A statement of interest showing how that candidate’s experience meets the
selection criteria and describing what their candidacy can offer the PPP Unit for
this important position
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APPENDIX L: Recommended
PPP Project Identification
Selection Tool for the PPP Unit The PPP Project Matrix
This PPP project identification and selection matrix, provided as part of this Final
Report, should be considered a dynamic tool to be used in identifying, selecting and
managing projects and should, therefore, be updated throughout the process. The
project related criteria used in this matrix is based on international “good practices”
and lessons learned in the selection, analysis and preparation of PPP projects.
The matrix can consists of a list of sector and project specific criteria that is divided
into three categories. The first category indicates the level of commitment to the
project on the part of the host Government institution(s), such as the line ministry.
Based on our experience, it should be said that a high level of commitment is critical,
especially in the larger, more complicated PPP project. The second category sets
forth the legal and institutional (LI) environment and capacity of the host
institution(s) in procuring implementing and managing a given PPP project.
Although the LI environment is cross sector, it also may be sector specific (e.g.,
private ownership of ocean front property). The third category is project specific
and considers everything from project risk, duplicability, affordability and private
sector capacity and appetite to construct, operate and/or finance the PPP project.
Although the ratings can be based on three possible results (good, neutral or bad),
the attached model assumes five potential rankings per criteria, with the rating of
“5” being the most favorable and “0” being the least favorable towards entering into
a successful PPP. The criteria are then weighted based on their overall importance.
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It should be noted that the score for each project on the long-list is a “snapshot”and
should be updated on an ongoing basis.
In the illustrative example, certain criteria (e.g., strong project support within the
government and an acceptable legal and institutional environment must be met
prior to even considering the merits of the project itself.
Each of the following three sub-sections presents one category. Each category
provides a list and description of the criteria within the given category and an
illustrative weighting of the individual criterion. The weighting should be based on
the overall objectives of the GoM and should be equal to 100% for each category.
Level of Project Commitment
This category must be met before the line ministries and/or PPP Unit devote any
significant resources to the project. It is believed by many that this is the single most
important criterion to achieving a successful project from inception to operation.
Is there a clear "Champion" committed
Is There Clear Commitment for the
to making the tough decisions required
Project from the Line Ministry? (Must be
to see the project through to
>=4)
completion?
Result (Must be "Yes" to proceed)
100.0%
Yes/No
Legal and Institutional (LI) Framework
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The criteria in this category are critical in defining the extent to which an enabling
environment exists.
Govt./Ministry Policy Support for PPPs
Is the project or sector explicitly
included in Govt's Sector Policies?
30.0%
Is Legal & Regulatory Environment
Supportive?
Are there any explicit legal barriers or
obstacles to PPPs in this sector?
40.0%
Does the Govt. have the Institutional
Capacity Required for a PPP?
Capacity to prepare, analyze &
implement a transaction as well as to
monitor & manage the PPP's
performance
30.0%
Weighted Average (Must be >= 70%
or 3.50 to proceed)
100.0%
Result (Must be "Yes" to proceed)
Yes/No
Project specific
The project specific category is subdivided into three subcategories (government priority,
private sector interest, and risk).
Government priority
This subcategory of criteria, which makes up the bulk of the criteria within the
project specific category, also accounts for the heaviest overall weighting of 55% in
the illustrative weighting. As can be seen below, affordability is the most significant
criterion within the category. Affordability refers to both the availability of
government budget in the case where the PPP project is not fully sustainable and
therefore requires some level of Government subsidization, and the ability of the
end users to pay a fee required for the service in order for the project to be
sustainable. It should be noted that with respect to fish landing sites (FLS) projects,
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they would require a combination of both government resources, primarily in
construction, and end user fees to cover operations.
Is there: Labour opposition, social
pressures, technological complexity,
large size, no similar precedents and
other implementation constraints?
10.0%
Replicability
Can this PPP be copied and applied
numerous times elsewhere in Mauritius?
7.5%
Affordability
Are their indications it is Affordable to
the client govt. agency budget and to
any end-users?
12.5%
Is there access to data such as existing
public sector costs, existing sector plans
Access to Required Data & Information
or feasibility estimates? Existing sector,
for the Project
project, technical, environmental
studies?
10.0%
Degree of Difficulty / Complexity of
Completing the PPP Transaction
Will existing jobs be affected? Will it
likely raise costs on end-users? Will it
likely cause significant social and
environmental Impacts?
10.0%
Will the PPP introduce new services
Is it a New Service? Quality/ Reliability
that are currently unavailable in
of Existing Service (is it poor or need
Mauritius? Or will it offer
improving?)
improved/more efficiency to services
already available?
5.0%
Level of significant social,
environmental & labour impacts?
Private Sector Interest
For illustrative purposes, this section accounts for 25% of the total project weighting
and may be a decider in cases where projects are close.
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Has there been an unsolicited proposal
Are there Private Sector Providers for
from the private sector? Are there
this Service (Local or Int'l)?
local firms that already provide this
service?
10.0%
Is There Private Sector Investment
Appetite (Equity)?
In the current financial climate, are
their likely investors who are willing
and able to provide the required equity
investments?
7.5%
Is There Private Sector Investment
Appetite (Debt)?
In the current financial climate, are
their likely lenders who are willing and
able to provide the required loans for
the investment?
7.5%
Risk
This category looks at the likelihood that the Government will be able to transfer
risk to the private sector. As a group the weighting counts for 20% of the total
project related weighting.
Technology / Design / Construction
Are the risks of technology/design and
construction estimated to be high or
low?
7.5%
Demand / Volume / Traffic
Are the risks to the level/volume of
demand for the project generally
considered to be high or low?
7.5%
Input Supply Risks
Are there key risks in providing the
inputs (land, fuel, other inputs) that
the project requires?
2.5%
Other Risks
What are the other most important
risks that this PPP would face?
2.5%
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APPENDIX M: LIST OF
ORGANISATIONS SUBJECT TO
THE PUBLIC PROCUREMENT
ACT
A.
B.
C.
D.
E.
Government Ministries and Departments
Municipal Councils
District Councils
Rodrigues Regional Assembly
Parastatal Bodies
(1). Agricultural Marketing Board
(2). Beach Authority
(3). Central Electricity Board
(4). Central Water Authority
(5). Farmer's Service Corporation
(6). Financial Services Commission
(7). Industrial & Vocational Training Board
(8). Information and Communication Technologies Authority
(9). Irrigation Authority
(10).
Mahatma Gandhi Institute
(11).
Mauritius Broadcasting Corporation
(12).
Mauritius College of the Air
(13).
Mauritius Educational Development Company Ltd
(14).
Mauritius Examinations Syndicate
(15).
Mauritius Film Development Corporation
(16).
Mauritius Institute of Health
(17).
Mauritius Meat Authority
(18).
Mauritius Oceanography Institute
(19).
Mauritius Ports Authority
(20).
Mauritius Qualifications Authority
(21).
Mauritius Revenue Authority
(22).
Mauritius Standards Bureau
(23).
Mauritius Sugar Authority
(24).
Mauritius Tourism Promotion Authority
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(25).
Mauritius Wastewater Management Authority
(26).
National Computer Board
(27).
National Transport Corporation
(28).
Outer Islands Development Corporation
(29).
Private Secondary Schools Authority
(30).
Public Officers Welfare Council
(31).
Road Development Authority
(32).
Rodrigues Educational Development Company Ltd
(33).
Sir Seewoosagur Ramgoolam Botanic Garden Trust
(34).
Small Enterprises and Handicraft Development Authority
(35).
State Trading Corporation
(36).
Sugar Industry Labour Welfare Fund
(37).
Sugar Planter's Mechanical Pool Corporation
(38).
Tea Board Tertiary Education Commission
(39).
Tourism Authority University of Mauritius
(40).
University of Technology
F. Any other body set up by an enactment whether body corporate or not and which
depends wholly or partly on government funding.
(1). Airports of Mauritius Ltd
(2). Cargo Handling Corporation Ltd
(3). Development Bank of Mauritius Ltd
(4). Enterprise Mauritius
(5). Mauritius Housing Company Ltd
(6). Mauritius Shipping Corporation Ltd
(7). National Housing Development Company Ltd
(8). State Informatics Ltd
(9). State Investment Corporation Limited
(10).
State Property Development Company Ltd
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APPENDIX N: Relevant Extracts
from Public Procurement Act
2006 for PPP Panel of Experts
"consultant" means a person under contract to provide consultancy services to a
public body in relation to a procurement contract;
"consultancy services" means services of an intellectual and advisory nature, not
incidental to the supply of goods or to the execution of works, such as design,
supervision, training, analysis, auditing, software development, and similar services;
"contractor" means a person who has entered into a procurement contract
"exempt organisation" means a body which is, by regulations, excluded from the
application of this Act;
“exempt organisation” means a public body, as specified in the First Schedule,
which is excluded from the application of the Act [PPP Regulations];
“parastatal body” means an organisation established under an enactment whether
body corporate or not and which depends wholly or partly on government funding
[defined in Public Procurement Regulations 2008];
"procurement" means the acquisition by a public body by any "contractual means of
goods, works, consultant services or other services;
"procurement contract" means a contract between a public body and a supplier,
contractor or consultant resulting from procurement proceedings;
"public body" -
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(a) means any Ministry or other agency of the Government;
(b) includes (i) a local authority;
(ii) a parastatal body; and
(iii) such other bodies specified in the Schedule; but
(c) does not include an exempt organisation.
15.
Choice of procurement method
(1)
Subject to subsection (2), the choice of procurement methods available to a
public body shall be (a)
for the procurement of goods, other services and works, by (i) open advertised bidding;
(ii) restricted bidding;
(iii) request for sealed quotations;
(iv) direct procurement;
(v) community or end-user participation; or
(vi) departmental execution; and
(b)
for the procurement of consultancy services, by (i)
request for proposals on the basis of –
(A) quality and cost;
(B) quality alone;
(C) quality and fixed budget;
(D) least cost and acceptable quality; or
(ii)
direct procurement.
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(2) (a) Except in the cases referred to in paragraph (d), procurement shall, in the
case of goods, other services or works, be made by means of open advertised
bidding, to which equal access shall be provided to all eligible and qualified bidders
without discrimination.
(b)
Open advertised bidding proceedings may include a prequalification stage,
or post qualification procedures, before selection of the winning bidder.
(c)
Open advertised bidding proceedings shall be carried out in a single stage or
in two stages in the cases referred to in section 29.
(d)
A method of procurement referred to in subsection (1) (a) (ii) to (vi) may be
used only if the public body has reason to believe that open advertised bidding (i) will not be efficient or practical for the procurement in question; or
(ii) will be too costly to apply given the value of the procurement.
(e)
Where a public body uses a method of procurement other than open
advertised bidding or, in the case of the procurement of consultancy services, a
method other than one specified in subsection (1)(b)(i), it shall note in the record of
the procurement proceedings the ground for the choice of the procurement method.
24.
Request for proposals
(1)
Where, in respect of consultancy services, the request for proposals method is
used, the public body shall draw up a shortlist of consultants, to ensure effective
competition, from among those who have the capacity to perform the required
services.
(2)
(a)
Where the estimated value of the procurement exceeds the prescribed
threshold, the public body shall, in order to draw up the shortlist, seek expressions
of interest by publishing a notice in a national newspaper of wide circulation and
include in the list those who have expressed interest in the procurement.
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(b)
Where the estimated value of the contract does not exceed the prescribed
threshold, the shortlist may be drawn up on the basis of the public body's own
knowledge and information.
(3)
The public body shall issue a request to the short-listed consultants, asking
them to confirm their interest by submitting a proposal, which shall include such
information as may be prescribed that enables them to participate in the
procurement proceedings and to submit proposals that are responsive to the needs
of the public body.
(4)
The selection of the successful proposal shall be based on -
(a)
the technical quality of the proposal, the consultant's relevant experience, the
expertise of his key staff, the proposed work methodology, as well as the price of the
proposal;
(b)
the quality of the technical proposal submitted within a predetermined fixed
budget;
(c)
the best financial proposal submitted by the candidates having obtained an
acceptable technical score pre-disclosed in the request for proposals; or
(d)
where the services are of an exceptionally complex nature or likely to have
considerable impact on future projects or national economy or may lead to the
submission of proposals with prices which are not comparable, exclusively on the
technical quality of the proposal.
(5)
The public body shall evaluate each technical proposal on the basis of criteria
which shall include (a)
the consultant's relevant experience for the assignment;
(b)
the quality of the methodology proposed;
(c)
the qualifications of the key staff proposed;
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(d)
transfer of knowledge, if required in the request for proposals; and
(e)
in the case of international competition, the extent of participation by
nationals among key staff in the performance of the assignment.
(6)
The financial proposals of bidders who have secured the minimum pass mark
in the technical evaluation shall then be considered and evaluated by the public
body after a public announcement of the results of the technical evaluation.
(7)
Where the choice of consultancy services is made in accordance with section
15(1)(b)(i)(A), (C) or (D), the financial proposals of all consultants whose technical
proposals attained the required minimum pass mark shall be read out to the bidders
who wish to attend, in accordance with the prescribed procedure.
(8)
Where the choice of consultancy services is made in accordance with section
15(1)(b)(i)(B) only the financial proposal of the consultant whose technical proposal
achieved the highest ranking shall be evaluated.
(9)
(a)
The contract may be negotiated with the winning consultant with
regard to the terms of the request for proposals, the scope of the proposed services,
deliverables, progress reports, facilities to be provided by Government and, subject
to paragraph (b), the financial proposal.
(b)
Where price has been a factor the fee for services shall not be subject to
negotiation and only the cost of reimbursable items may be negotiated in such
manner as may be prescribed.
(c)
Where the negotiations fail to result in an acceptable contract, the public
body shall notify the consultant accordingly and proceed to the next ranked bidder,
and so on.
(10) The consultant whose bid attains the highest score, in accordance with the
criteria and selection method set forth in the request for proposals, or the one with
the least cost in the case of the least cost method of selection, shall be selected for
award, subject to satisfactory conclusion of negotiations.
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(11) The public body shall notify the successful consultant of its selection for
award and shall simultaneously notify all other short-listed consultants of the
decision.
(12) In the absence of a challenge by any other consultant within 15 days of a
notice under subsection (11), the contract shall be awarded to the successful
consultant indicated.
25.
Direct procurement
(1)
The direct procurement method allows a public body to purchase goods,
other services or works from a single source without competition.
(2)
Direct procurement is permitted -
(a)
where the value of the procurement does not exceed the prescribed
threshold;
(b)
where only one supplier has the exclusive right to manufacture the goods,
carry out the works, or perform the services to be procured, and no suitable
alternative is available;
(c)
within the prescribed limits, for additional deliveries of goods by the original
supplier which are intended either as partial replacement or extension for existing
goods, services, or installations and where a change of supplier would compel the
public body to procure equipment or services not meeting requirements of
interchangeability with already existing equipment or service;
(d)
within the prescribed limits, where additional works, which were not
included in the initial contract have, through unforeseeable circumstances, become
necessary and the separation of the additional works from the initial contract would
be difficult for technical or economic reasons;
(e)
where the nature of the consultancy services requires that a particular
consultant be selected due to unique qualifications; or
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(f)
where continuity of consultancy services is essential to meet the objectives of
the consultancy assignment.
19.
Restricted bidding
(1)
Restricted bidding may be used -
(a)
where a public body has reason to believe that the goods, other services or
works are only available from a limited number of bidders;
(b)
where the time and cost of considering a large number of bids is
disproportionate to the value of the procurement, having regard to such thresholds
as may be prescribed; or
(c)
by limiting the participation in a particular procurement to those suppliers
included on pre- approved supplier eligibility lists drawn up and maintained by the
public body, in such manner as may be prescribed, so as to ensure that suppliers of
specialised goods and services have and maintain the necessary technical and
financial capability to provide them.
(2)
(a)
Where restricted bidding is used on the ground referred to in
subsection (1)(a), all known suppliers capable of supplying the goods, other services
or works shall be directly solicited.
(b)
Where restricted bidding is used on the ground referred to in subsection
(1)(b), the public body shall, as far as reasonably possible, directly solicit bids from a
minimum of 5 bidders.
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APPENDIX O: Relevant Extracts
from Public Procurement
Regulations for Panel of PPP
Experts
41. Restricted bidding
For the purpose of section 19(1) (b) of the Act, the threshold amount shall be 5
million rupees for the procurement of goods, works and other services.
42. Standing lists (Approved list of suppliers/contractors)
(1) The following shall apply for the maintenance and use of registration and
classification systems in restricted bidding procedures, and to any databases and
lists of interested or approved parties –
(a) the database or list shall only be maintained for the information of various public
bodies and any non-inclusion in the database or list shall not preclude consideration
of a firm if it meets the eligibility and qualifications specified in the invitation
documents;
(b) requests to be classified, or to be entered in the database or list, shall be
receivable at any time from any interested party and shall be acted upon within a
reasonably short period of time;
(c) the existence of the classification system, database or list, the conditions to be
satisfied by parties to be entered in the classification system, database or list, the
methods according to which satisfaction of each of those conditions is to be verified,
the period of validity of an entry in the classification system, database or list and the
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procedures for entry and for renewal of the entry shall be generally and regularly
publicised in such manner so as to bring them to the attention of interested parties;
and
(d) listed parties shall be given prompt notice of their inclusion or removal from the
classification system, database or list.
(2) Any classification system, or other database or list shall be designed to be easily
retrievable, including, where feasible, in electronic form, by the widest possible
audience, and shall be regularly reviewed and updated.
44. Direct Procurement (as amended per G.N. No.71 of 2008)
(1) For the purpose of section 25(2)(a) of the Act, a public body may resort to direct
procurement(a) in the case of procurement of goods, where the value does not exceed 500,000
rupees provided that the total cost per single item does not exceed 100,000 rupees;
(b) in the case of procurement of works, consultancy services or other services, the
value does not exceed 500,000 rupees.
(2) A public body shall maintain records showing details of oral or informal
quotations sought from suppliers prior to the award of the contract.
(3) For the purposes of section 25(2) (c) and 25(2) (d) of the Act the limit shall be fifty
percent and thirty percent respectively of the initial contract value.
47. Invitation for expression of interest and preparation of shortlist (as amended
per G.N. No.71 of 2008)
(1) For the purposes of section 24(2)(a) and (b) of the Act, the threshold shall be 10
million rupees.
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(2) For the purposes of section 24(3), the public body shall include in the request to
the short-listed consultant such information to enable the public body to make a
judgment on the firm’s suitability and shall not be so complex so as to discourage a
consultant from expressing his interest.
(3) A notice seeking an expression of interest shall include –
(a) the identification of and contact information for the public body;
(b) an identification and general description of the assignment or project in question,
including the working location, and any project identification code;
(c) the date of issue of the notice, and the closing date and instructions for
submission of the expression of interest;
(d) any source of funding;
(e) the projected time period for implementation and completion of the assignment;
(f) the qualification criteria to be met to be short-listed.
(4) In order to determine the capability and experience of consulting firms seeking to
be short-listed, the information requested shall include –
(a) a profile of the company, its organisation and staffing;
(b) in the case of associations between two or more firms, the name, address and
profile of the participating firm, and nature of the association such as joint venture,
subcontract;
(c) identification of any lead firm;
(d) details of experience or similar assignments undertaken in the previous 5 years,
including their locations ;
(e) the focus on the firms’ role in similar assignments in the region or elsewhere;
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(f) the curriculum vitae of staff who could be available to work on the assignment;
(g) in the case of individual consultant, the curriculum vitae of the consultant;
(h) a statement that short-listed consultants will be invited to submit proposals;
(i) the number of copies of the requested information to be submitted, and the
address to which submission is to be made, and from which additional information
may be obtained.
(5) A minimum of 15 days from the date of publication of the notice shall be
provided for submission of expressions of interest.
(6) A consultant who has expressed interest shall be informed of the final short list of
firms.
(7) (a) A short list of at least 3 firms shall be prepared pursuant to the assessment of
the information furnished.
(b) In preparing the shortlist the public body shall endeavour to include different
nationalities and backgrounds and where possible at least one local firm so as to
provide a wide variety of approaches for the public body to make a choice.
(8) Where there is not adequate number of responses to result in the minimum
number of 3 qualified firms, the advertisement shall be repeated.
(9) The final shortlist may include well-qualified consultants that did not respond to
the solicitation of expression of interest where there is a need to make up a
minimum number.
(10) Where the value of the procurement does not exceed the amount referred to in
paragraph (1), the shortlist may be drawn up on the basis of the public body’s own
knowledge and information.
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