Home ›› 08 May 2023 ›› News
The government is looking to revoke the independence of the Public-Private Partnership (PPP) Authority in exercising of financial and administrative powers and performance of functions by amending the PPP Act, 2015.
A bill, titled “Public-Private Partnership (Amendment) Act, 2023” to amend the PPP Act has recently been placed in parliament and has later been sent to a committee for further scrutiny within 30 days.
The government enacted the PPP Act, 2015 with the aim of creating a partnership with the private sector by attracting domestic and foreign investment to build infrastructure to improve living standards and accelerate socio-economic progress.
However, now the government is planning to amend the bill as it contains certain clauses that are inconsistent with the law regarding other similar autonomous agencies of the government.
According to the proposed bill, several sections of the law are being revised and amended in line with the laws of other departments and organisations under the purview of the Prime Minister’s office.
According to the existing law, the PPP Authority shall be impartial and independent in the exercise of financial and administrative powers and performance of functions.
In the amended bill, the word ‘independent’ has been omitted. In addition, the number of meetings of the Board of Governors of the PPP Authority has been rescheduled to two per year from six.
Guidelines on PPPs as well as approval of procedures and publication of official gazettes have also been included in the amended bill.
Meanwhile, the issue of government’s financial participation in PPP projects has been retained, but incentives have been removed.
Besides, the bill states that the chairman of the PPP Authority will be directly responsible to the Board of Governors for all activities. The appointment and terms of service of the chief executive officer of the authority will be decided by the government instead of the Board of Governors. In addition, the power to approve the organisational structure has been entrusted to the government instead of the board.
As per the existing law, the PPP Board of Governors have the power to approve the appointment of a necessary number of officers and employees as per the organisational structure for the proper performance of the functions of the authority. The board also has the capacity to prescribe the terms and conditions of service.
The amended bill states the power of approval in these regards will be handed over to the government instead of the board.
According to the amendment bill, after signing the contract for a project, the relevant government organisation will provide necessary support to the company for the implementation of the project.
Moreover, the new bill will revoke the Board of Governor of PPP Authority’s power to interpret the PPP Act and entrust it to the government.
According to the PPP Authority, governments require long-term funding plans, increased tax revenues, and a focus on socially and environmentally sustainable infrastructure if they are to close their national infrastructure investment gaps.
The government’s 8th Five Year Plan prioritises developing projects in power and energy, transports, roads and bridges, tourism, ICT, housing, urban health, education, agriculture and food security through PPP modality.
It also sees PPP as a mechanism to increase FDI to Bangladesh. The Perspective Plan of Bangladesh 2021-2041 clearly mentions that a PPP will be in place to succeed this plan.
It envisages that 36.36% of GDP will have to come through PPP & private investment specially in transport, water & ICT focused sectors. The country’s SDG financing strategy also identifies PPP as the 5.5% contributor of the total financing need.
