About Municipal Finance and Public-Private Partnership
For the first time in history, more than half the world’s population lives in cities, with 90 percent of urban growth taking place in the developing world. Rapid urbanization is swelling municipal populations globally, putting pressure on an often old and insufficient infrastructure. Municipal budgets cannot keep pace with investment needs. As devolution strategies evolve, municipalities are increasingly responsible for the funding and provision of public services but often in constrained and uncertain budget environments.
A growing number of local governments are turning to Public-Private Partnerships (PPPs) to deliver municipal services, solid waste management, recycling, water and sanitation, energy-efficient street lighting, primary health care, local transport terminals, public markets, parking facilities, parks, affordable housing, municipal facilities and ‘Smart City’ applications. However, the experience of PPPs at local levels and with smaller municipal projects has received less attention than larger, national PPPs.
The Municipal PPP Framework provides municipalities with a rigorous procedural framework and a set of practical tools to enable them to identify promising projects, where PPPs can deliver benefits, to prepare and implement those projects well, all on a programmatic basis to reduce costs and improve efficiency. To increase accessibility, the Framework uses a modular approach. The Guidance Note provides a simple summary of the issues, covering the essential aspects of municipal PPP for practitioners. A detailed discussion of key issues is provided in 20 modules to allow the reader to access more information on specific topics as and when needed. The Executive Summary provides a summary of the Guidance Note. Finally, project summaries (maximum of two pages each) describe municipal PPP projects with innovative solutions for some of the key challenges facing municipalities. Throughout the Framework, users will find references to additional resources that can help them pursue their own PPP projects and programs.
This Framework is designed to support municipal governments and staff; it is written with their perspective in mind. Though it is written from a government perspective, it is also useful for decision makers and practitioners across a range of municipal infrastructure sectors and services.
Sponsors and Influences
Development of the Municipal PPP Framework was funded by the Global Platform for Sustainable Cities and led by a team of experts from the World Bank Group. Early materials were developed by Rebel Consulting.
The Framework is influenced heavily by the lessons learned from the Tanzania Sub-sovereign PPP Project funded by the U.K. Department for International Development. A pilot of the Framework in Indonesia is funded by Canada’s Department of Foreign Affairs, Trade and Development.