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12 September 2013

New law for Public-Private Partnerships in offing

Current procurement laws are rigid and inflexible, making them untenable for the new dispensation of Public-Private Partnerships. 
Aston Kajara, the State Minister for Finance minister revealed that a new law governing Public Private Partnerships (PPPs) has been considered by Cabinet and is currently being reviewed by the parliamentary committee on finance.
“The procurement law is elaborate and most public servants do not understand it. It dictates that government must advertise every tender while Public Private Partnerships can be exclusive at times,” he said.
Kajara made the comments at the start of a three day training of 30 senior officials of ministries, departments and agencies at the Serena Lake Victoria Hotel.
The Privatization Unit and the International Finance Corporation are readying public servants for the new dispensation with funding from the Public Private Infrastructure Advisory Facility (PPIAF).
The new law will restrict local governments from negotiations with foreign firms, giving exclusive rights to teams from the central government.
Kajara’s comments come in the wake of the hotly contested 600Mw Karuma hydro power station which is under a PPP structure.
“The role of the private sector is particularly important if we have to meet the objectives of both the National Development Plan and the Vision 2040 of promoting economic growth, job creation and improving service delivery,” he said.
The minister noted that senior government employees need to be trained to negotiate contracts with foreign and private companies for the country and all citizens to benefit.
He pointed out that while private companies are motivated by profit maximization, the government is more interested in service delivery. He noted that well trained government negotiators are a necessity.
Turning to the delay in the Karuma dam execution, Kajara noted that more transparency is needed to get the project running. He said that senior public servants must acquire skills in project management, monitoring and evaluation to improve the execution of PPPs.
David Ssebabi, director of privatisation unit, Ministry of Finance noted that training senior public servants will enable PPPs to be run in a more efficient way as the economy transforms from peasantry to prosperity.
Kajara revealed that three firms have been shortlisted to develop the Kilembe mines. Initially, five firms were selected for preliminary assessment.
Two Chinese firms and one Australian firm have been selected for the next phase that includes the submission of bids, technical and financial analysis.