Contract of the future:
Public Private Partnership stimulates innovation and efficiency
On 22 July 2005, Rijkswaterstaat announced the tender procedure for the DBFM project Capacity Extension Coentunnel Section. The tender procedure for this extensive project, which runs into millions, was subject to the latest European guidelines. This meant, among others, that a qualification round took place, followed by a negotiation phase with the selected parties. Of the five participating construction consortia, Coentunnel Company finished first.
The project is carried out as a Public Private Partnership (PPP), a form of contract whereby the government leaves its construction tasks to the private sector as much as possible - a form of cooperation that can offer the best results for each party. However, this requires parties to conclude watertight agreements relating to the responsibilities of each party.
Design, Build, Finance, Maintain
Coentunnel Company is responsible for the design, the construction, financing and maintenance of the project. In a DBFM project, Rijkswaterstaat lets go of its detailed specifications and strong control of details. Instead, Rijkswaterstaat supplies the contractor with a framework of basic requirements relating to costs, deadlines, environmental policies etc. This ensures that the client and the contractor have a shared objective: delivering a high-quality end product at minimal costs and within the deadlines. The benefit is that both parties can work more efficiently, more result-driven and therefore cheaper. This working method also encourages innovative solutions.
Technical and financial specialisations
Coentunnel Company, referred to by insiders as a ‘special purpose company’, is perfectly equipped to fulfil the wishes and requirements of Rijkswaterstaat in this project. All required specialisations are represented in the consortium, in technical and particularly also in financial areas, as Coentunnel Company is responsible for financing the project. Rijkswaterstaat will not pay the company in full until after the tunnel becomes available. In order to obtain the most favourable financing terms from the banks, reliability and financial solvency of the consortium are crucial factors. Coentunnel Company has a good score on both qualities and is setting an example of Public Private Partnerships as the way of the future.