Flexibility in PPP contracts – Dealing with potential change in the pre-contract phase of a construction project
Hatice Çiğdem Demirel,
Wim Leendertse,
Leentje Volker and
Marcel Hertogh
Construction Management and Economics, 2017, vol. 35, issue 4, 196-206
Abstract:
Public Private Partnerships (PPPs) cover a range of possible relationships between public and private parties. PPP contracts are typically used in contexts of great uncertainty, such as large construction and infrastructure projects that are realized over a longer period of time. Hence, a major challenge in PPPs is to keep construction progress cost-efficient and on schedule, under continuously changing circumstances. One way to achieve this is through clever contracting, by proactively anticipating potential change in the planning phase and providing flexible contract mechanisms that enable an effective response. The purpose of this article is to discuss potential changes and the subsequent requirement of flexibility in PPP contracts. By flexibility, we mean the ability of the contract to deal with changing circumstances. We set out to do so by studying the available literature on the subject and by analysing the case study of the Blankenburgverbinding in the Netherlands, a Design, Build, Finance and Maintain (DBFM) project that is currently in its planning phase based on 32 interviews. Our main findings are that the timely and accurate recognition of potential changes, combined with the availability of flexible coping mechanisms, provide the stakeholders with a better understanding of the challenges they face in realizing their aims in the pre-contract phase of projects. This understanding helps to better prepare a PPP contract for potential changes.
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)
Downloads: (external link)
http://hdl.handle.net/10.1080/01446193.2016.1241414 (text/html)
Access to full text is restricted to subscribers.
Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:taf:conmgt:v:35:y:2017:i:4:p:196-206
Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RCME20
DOI: 10.1080/01446193.2016.1241414
Access Statistics for this article
Construction Management and Economics is currently edited by Will Hughes
More articles in Construction Management and Economics from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().