Original Study by Jianfeng Zhao, Carter B. Casady, David Greenwood, Niraj Thurairajah, Barry Gledson, Rui Cunha Marques
This policy essay examines the termination of PPP arrangements and subsequent re-nationalisation of the rail sector in the UK. It develops a framework to examine these events and to draw lessons for better governance of PPPs throughout the life-cycle.
In 2018, the UK government abandoned the PPP approach (labelled the private finance initiative) which dated back to the early 1990s. Separately, it reversed the privatisation of the rail industry which involved a system of franchising rail services in different regions of the UK. A new state-owned entity branded as Great British Railways (GBR) was established to assume control of the rail system by 2023.
This essay does not examine the planned operations of GBR. Instead, it argues that the evidence demonstrates the limited effectiveness of nationalisation policies. This prompts the main question addressed in the paper: How should PPP-type projects be more effectively managed when public ownership alone does not guarantee improved performance?
To answer this question the paper proposes a four-quadrant model based on two dimensions: (1) contractual formality and (2) relational engagement with the private sector. This model is applied to two high-profile and previously privately-operated transport projects to depict scenarios where Britain can realise ‘national renewal’ in transport PPPs (and variants thereof).
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