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How does PPP work across different housing sectors?

When it comes to enabling more infrastructure projects to be completed – and in a more efficient and value adding way – the Public Private Partnership (PPP) has proven to be a useful solution. PPPs were first developed in the 1990s as a method for overcoming the burden of the risks involved in large, high value projects. They have proven to be a particularly positive development for sectors such as housing and continue to provide opportunities right across the housing industry.

How does PPP work in the housing sector?

The range of different ways in which public authorities and the private sector can come together to create new housing developments with PPP projects is broad. A PPP project tends to be one where there would be significant risk for a private or public entity in taking it on alone but in working together this risk can be mitigated. There is particular benefit for housing projects that are designed to deliver benefits to the public, as the risk inherent in these projects is often predominantly born by the private sector partner and the public sector budget remains protected. So, how are we seeing PPP working across different parts of the housing sector?

Making up a shortfall of government capital

Governments and local authorities rarely have enough in the budget to meet the public need and so it can be a slow process of waiting and debating over funding in order to get housing infrastructure projects under way. The benefit of PPP is that projects can be delivered more quickly so as to meet a more urgent public need.

Creating genuine value for money

In working with PPP, public authorities have access to expertise across a very wide field from a range of partners that may not otherwise be involved. From volume house builders through to housing associations, co-operative housing and community land trusts there are many private sector facilitators available to enable PPP housing infrastructure projects. All of these can bring something new to the table, from expertise and innovation through to the experience to reduce delays and the resources to make private finance available where there are budget gaps.

Broadening out the types of projects available

From buy to rent through to creating genuinely affordable public housing, there are many projects across the housing sector where PPP could potentially be used to make a real difference. In particular, when public authorities work with innovative private businesses, development can take a much more creative and sustainable turn.

Using PPP to solve infrastructure issues

It is widely thought that PPP could provide a solution to the housing shortage in the UK. With the right incentives, PPP projects could be used to deliver everything, from family homes and flats through to retirement communities and supported living. As the pressure on the government grows to increase the supply of available housing in the UK , PPP offers a much wider range of solutions than the public sector with its more limited resources could do alone.

RG Group is focused on all aspects of construction, from luxury projects to affordable housing – contact us to find out more.

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