Definition
A public-private partnership is a binding legal agreement between public and private sector entities where the government will pay a private sector entity to perform a service.
Essential Characteristics
A public-private partnership will significantly vary depending on the type of service being sought by a public entity. Nonetheless, public-private partnerships have the following principal features:
- The provision of serving-enabling infrastructure from the public entity to the private entity
- Risk-sharing between public and private sectors
- Contributions to be made by the government such as land, capital works, risk-sharing and other support mechanisms
- How payments will be made.