Development of a National Infrastructure Plan

A national infrastructure investment strategy defines a nation’s investment priorities for its infrastructure over an extended period of time. The aim of such a strategy is to deliver economic, social and environmental benefits to a nation through the production of a defined and costed National Infrastructure Plan (NIP). This programme has been designed to enable delegates to understand how the development and delivery of a national infrastructure investment strategy, aligned to a country’s (or region’s) economic, social and environmental policies, can meet its needs and help to drive economic growth. The production of a NIP is a complex and intensive process requiring the input of a wide range of governmental and non-governmental expertise. Governments need to understand the process and be prepared to devote all the necessary resources to its development prior to commencing the infrastructure planning. The current lack of investment in infrastructure, due to public capital constraints, is having a negative impact on growth in many countries. In an ideal situation a nation would be able to fund all infrastructure development from public capital, but as seen globally, this is becoming increasingly difficult to achieve and there is an increasing need to develop alternative funding sources through private capital solutions. Many countries are turning to Public Private Partnerships. Pivotal to the successful development of infrastructure, is the matching of risk to bankability; where this is not achieved, the required private capital will not be forthcoming. This programme shows how the development of a correctly devised infrastructure strategy and its associated NIP can help to attract the necessary private capital for investment in national and regional infrastructure and also demonstrates the key role of Public Private Partnerships in supporting the efficient and timely delivery of major infrastructure projects, delivering long term value for money and quality public services. In this programme the delegates will gain knowledge and business acumen in the following key areas: The fundamental principles of developing a national/regional infrastructure investment strategy and production of a national/regional infrastructure plan Capacity building and training Development of a national/regional PPP Unit Improving the legal/regulatory context for infrastructure investment Promoting PPP opportunities amongst potential investors and financial markets Infrastructure needs analysis Skills in the development of sector-specific Strategic Service Models Investment prioritisation and the use of Multi Criterion Analysis in formulating long term vision and medium term goals Project funding versus project financing – matching needs to affordability Investment decision making - best practice business case approval methodology Programme and project appraisal Designing a pipeline of bankable infrastructure projects (allocation of risk) Governance Sustainability Who should attend? Government ministers Public sector senior officials and investment decision makers Public sector planners Policy development directors Government and public service oafficers Municipal officers Project Financiers/Investors Contractors Service providers Facilities Management companies Utilities Commercial banks Project law firms Financial Advisors Environmental consultants Development agencies Programme objectives By the end of programme delegates will be able to understand: Principles of developing a national infrastructure investment strategy Production of a national/regional infrastructure plan Infrastructure needs analysis Strategic service modelling Programme and project appraisal Project prioritisation and investment decision making Project finance Project preparation and value for money Successful procurement and delivery, including the use of PPP Project risk allocation and payment mechanism Post contract/operational aspects of infrastructure projects Training methodology This programme is designed to encourage delegate participation through a combination of group discussion, video, site visits, practical exercises and case studies.
Day 1 Overview: National infrastructure planning Introduction Political expectations, government support, undertakings, and programme structure Economic, social and environmental needs aligned to policies/development goals Legal/regulatory context for infrastructure investment (drafting new PPP laws or amending existing laws and regulations to cope with a PPP agenda) Establishment of an infrastructure unit to lead the development and implementation of the NIP Infrastructure sectors - national perspective Transportation Power Health Education Housing Case study: Examples of international best practice national and regional infrastructure plans The national infrastructure plans, and their development and implementation, from Australia and the United Kingdom will be used as examples of international best practice. Strategic service modelling (infrastructure sectors) Sector requirement/goals/priorities/policy Defining what services will be required – service models Infrastructure audit Infrastructure mapping Vision for each infrastructure sector Total system design Good governance Enabling institutions, procedures and processes Competitively selecting the strategic private sector partner Disclosing relevant information to the public Stakeholder engagement Regulatory entity to appropriately oversee the contractual arrangements Protecting the public interest Sustainability Sustainable development Sustainability criteria and enhanced success of PPPs Sustainability and award criteria How sustainability goals can be translated into measurable specifications in the PPP contract Monitoring and evaluation Sustainable development projects delivered through PPPs Prioritisation against outcome-based goals: Judging which infrastructure deficiencies need to be addressed and in which order. Assessing and allocating risk Development risk Completion risk Cost increase risk Performance risk Operation risk Market risk Political risk Environment risk Social risk Credit risk Workshop: Creating a risk register All infrastructure projects are subject to risk: at the planning and consultation stage, the implementation stage and even during the contract management phase. In the PPP planning process, one of the first tasks is to identify all the risks at the different stages of the project. A key aspect of the PPP structure is its ability to help facilitate the transferring of risk to the party that is best suited to manage or minimise it. Participants will create a risk register based around a case study of a DBFO (Design, Build, Finance and Operate) project. Day 2 Recap day one: Establishment of a framework for the development of the National Investment Strategy Infrastructure Unit Policy framework Infrastructure sectors Strategic service modelling Project prioritisation Video - Public Private Partnerships: The video provides a quick introduction to the concepts of Public Private Partnerships. Project funding versus project finance Funding profile When to use PPP/conventional procurement Use of multi-criterion analysis to determine priorities across the sectors Establish the decision context Identify the options to be appraised Identify objectives and criteria ‘Scoring’: Assess the value associated with the consequences of each option for each criterion ‘Weighting’: Assign weights for each of the criterion to reflect their relative importance to the decision Combine the weights and scores for each option to derive an overall value Examine the results Sensitivity analysis Use of cost benefit analysis to determine priorities within each sector (benefits appraisal) Strategic context Need Objectives and constraints Monetary costs and benefits Risk Non-monetary costs and benefits Net present value Affordability Preferred option Project viability assessment: Matching needs to affordability (bankability) Project viability Economic/political viability Funding viability – public capital versus private capital Legal viability (including PPP law) Technical viability Regulatory environment Source country issues Political stability Transparency/anti-corruption Credit worthiness Remittances Project structure issues Shareholders Funding/financing structure Third party risk allocation Contractual agreements Project agreement Construction agreement Operations and maintenance agreement Off take purchase agreement Case study: Payment mechanism Participants will be issued with a bespoke payment mechanism and engage in discussion on the components of the mechanism for the DBFM project. Identify gaps in funding and potential solutions Time value of money Equivalence relationships Capital deficit Financing mechanisms Day 3 Site visits Two site visits are arranged for day three of the programme: Visit 1: University College Hospital London (Morning) University College London Hospitals NHS Foundation Trust (UCLH) is one of the most complex NHS trusts in the UK, serving a large and diverse population. The Trust has a turnover of £882 million and contracts with over 70 primary care trust commissioning bodies to provide services. The hospitals see over 950,000 outpatients and admit over 156,000 patients each year. The Trust is a Public Private Partnership. Format for the visit Presentation on the development of the hospital PPP with a focus on the contract award process, design, construction, contract award and contract management Guided tour of the key areas within the facility; particular emphasis will be placed during the walking tour on facilities management The visit will conclude with a question and answer session. Participants will have the opportunity to ask questions relating to any aspect of the presentation or tour Visit 2: Treasury Building (Afternoon) In 1999 Exchequer Partnership Plc (EP), a consortium of architects, developers and service providers was granted the lease of the building and a contract to provide high standard serviced office accommodation for 35 years through a Private Finance Initiative agreement. The complete refurbishment of 1 Horse Guards Road, formerly known as Government Office Great George Street (GOGGS), has allowed all Treasury staff to be housed in one building for the first time in 50 years. Format for the visit Presentation on the development of the facility with a focus on the contract award process, design, refurbishment, contract award and contract management Management of the redesign of an old building to modern standards Guided tour of the key areas within the facility; particular emphasis will be placed during the walking tour on facilities management The visit will conclude with a question and answer session. Participants will have the opportunity to ask questions relating to any aspect of the presentation or tour Day 4 Key emphasis will be on relating the learning on days one and two with the site visits on day three. The final morning will bring together this learning with the key elements in the production of the NIP. National infrastructure development as a public policy issue Why do we need modern infrastructure Infrastructure context Issues with infrastructure delivery Long term infrastructure investment strategy How to address the national infrastructure deficit Steps to produce a national infrastructure plan Procurement route – PPP or traditional? Public sector requirements for successful delivery Realising value Case study: Developing a major PPP Hospital The case study will focus on the stages in the development of the largest PPP hospital in Ireland. National infrastructure plan Structure Strategic implementation plan Costed infrastructure plans Co-investment – linking strategic service models Strategic investment plan Economic impacts Social impacts Environmental impacts Course summary and close