CHALLENGES FACING IMPLEMENTATION OF PUBLIC PRIVATE PARTNERSHIP PROJECTS IN NAIROBI CITY COUNTY

Kevin Mulama   & Yusuf Muchelule
PUBLIC PRIVATE PARTNERSHIP PROJECTS IN NAIROBI

ABSTRACT
This study addresses the issues that challenge the implementation of the public private partnership projects in Nairobi City County. Like all projects, implementation stage is always faced with challenges that have to be overcome to realize the desired outcome-in this case Nairobi City County has to be able to face the challenging situations which have to be dealt with in order to realize its development plan. This study has identified those challenges. The general objective was to find out the challenges that face the implementation of Public Private Partnership Projects in Nairobi City County. The specific objectives were: the examination of policy framework; institutional framework; legal framework; project planning; and project cost sharing among partners in a PPP at Nairobi City County. The problem being lack of effective policy, institutional and legal frameworks or poor planning of PPP projects. The Primary data was collected using interview guide and use of questionnaires while secondary data was collected through desk research. Through stratified sampling, Finance and Economic Sector was selected to participate in the study. This is the sector that deals with PPP project implementation. The study used primary data, which was gathered from respondents using a structured questionnaire, which was analyzed using descriptive statistics. Staffs of departments whose functions use the PPP strategy were given questionnaires that they filled and responded accordingly. The study found out that despite PPP Projects being under the Finance and Economic Sector most of the staff were not actively involved in PPP Project selection, the PPP Policy, Institutional and Legal frameworks are not adequate enough to permit effective implementation of PPP Projects. Equally the level of involvement of staff in project planning is also on a very low scale. In terms of Cost sharing respondents felt that it does not play a major role in PPP project implementation. The study also studied the contract agreements, minutes of council and/or county resolutions and quarterly reports to get secondary data. Content analysis was used to analyze the data collected. The study concluded that the main challenges facing the implementation of PPP Projects at Nairobi City County are ineffective policy, institutional and legal framework. The study recommends that staff in the relevant sector dealing with PPP be fully involved in project implementation from the policy formulation stage through planning to project completion stage. The staff also needs to be trained on Project Management.
Key words; Projects, Public private partnerships, cost sharing, legal, institutional and policy frameworks.
INTRODUCTION
In today’s world the drive for social-economic development has gained a wide spread attention over the recent years both in Kenya and the entire world. In order to achieve this form of development there has been establishment of development organizational structures based on partnerships such as public private partnerships (PPP). These forms of structures have come with a number of benefits and challenges, for example, (Gordon Cameron, 2010) in his study assert that in the transport sector Public-Private Partnerships (PPP) is a growing phenomenon throughout the world. And further that the developing world in particular has seen a veritable explosion of such arrangements. There can be, however, a significant difference between developing countries that are 'low-income' versus those that are middle-income. In some ways low-income countries can benefit more from the access to new capital and technical expertise that a PPP can bring and on the other hand there can be significant barriers to implementation of PPP's in low-income nations.
Equally, a paper by Zuzana K., T. (2007) on implementation of public private partnership projects in Czech Republic alludes that “Czech cities and regions are starting to use more and more new managing methods based on partnership with private sector as well as with the Non-governmental organizations and other civic association and that this process is relatively recent and the integration of the public private partnership model to general practices still meets a lot of constraints”.
Along with that a paper by KPMG India (2010) says that the challenges that exist between what’s planned versus what has been able to be delivered results from Various reasons ranging from inadequate preparedness of projects, shortage of equipment to the delay in financial closure.
S.F. Rostiyanti and R,.Z. Tamin (2010) points out that in order to enhance the implementation of public private partnership projects, public bodies need to be clear about the fundamental principles and objectives behind public private partnerships. They further state that there are two key drivers required in the development of a successful public private partnership program, and one of them is political will which is determined through a public private partnership policy framework which comprises a number of interlocking structures including legal and regulatory and institutional aspects.
Also a study in South Africa revealed that there was a general agreement among many interviewees that the market for PPPs, and the legal framework for PPPs, are characterized by a lack of policy direction from the highest levels of government, or at least a lack of clarity in the minds of implementing agencies and the private sector, on why South Africa should do PPPs, what PPPs are, and what is or should be the role of the PPP Unit (Matthew Nell & Associates, 2007).
Another study, pointed out that the main problems of PPP in Bangladesh included the launch of PPP before formulating any strong legal framework, absence of proactive human resource to coop with changes in administration and the fact that PPP initiatives were not well planned and/or organized (kabirsadeeq, 2011).
In Nigeria, concerns on the quality and financing of health-care delivery especially in the public sector had initiated reforms including support for public-private partnerships (PPP) at the Federal Ministry of Health. Likewise, Enugu State had developed a draft policy on PPP since 2005. However, non-validation and non-implementation of this policy might have led to loss of interest in the partnership (Anyaehie U., et al, 2014).
Mwaengo, Linet Mosa (2012) revealed that although the PPP strategy had improved service delivery at the municipal council of Mombasa, the implementation faced many challenges. These are lack of expertise, lack of policy, poorly designed contracts, corruption, and political interference.
Likewise, Marcel et al (2011) argued that public private partnership projects for water and sanitation delivery in local authorities are one of the key drivers of   economic transformation in the bid to the realization of the vision 2030, however the concept of public private partnership for services and facilities is hardly ever on the agenda of local authorities, in Kenya, although it may well be the most promising way for achieving development goals.
As indicated above the idea of partnering between public institutions and the private sector has grown tremendously, however there are a lot of challenges that emerge during the implementation process of the PPP Projects globally, regionally, national, and even locally. This paper will explore those challenges in details specifically for Nairobi City County and give recommendations on the way forward.

     Statement of the problem

The JICA study team (2013) report says that there are guidelines relating to private sector participations and license application for companies related to PPP in solid waste management including transportation, incinerator, landfill, recycling, transfer station, etc. at Nairobi City County. However, no technical guidelines exist for solid waste management or facility operation that enhances their implementation. Allison Kasozi and Harro von Blottnitz (2010) also argued that the registration and oversight of PPP in Private Waste Collection Companies in Nairobi by the then City Council of Nairobi (CCN),  needed to recognize, formalize and streamline the operations of  Community Based Organizations (CBO’s) in waste collection so that they have the same legal and operational status as Private Collectors.
Equally, local government financing of essential services is fundamental to the economic development of a country. The financing of these services can be undertaken through local sources of revenue which would in most cases include the government transfers. Other sources would be debt financing through loans or bonds; and/or through public private partnerships (PPPs). The obvious fear is that due to the profit motive of the private sector and lack of a clear policy framework, their participation in providing the public good may not have the impact and effectiveness that would be in tandem with the overall local government objective of service delivery to the wananchi (Nguri 2009).
The above sentiments have also been echoed by (Hadija R. Dhiram Diba, 2012) that Public Private Partnership are complex institutional arrangements involving players from diversified fields and as such implementation will not be easy.
As expressed above there are clear indications that Project implementation through Public Private Partnership is a phenomenon surrounded with implementation difficulties especially in Nairobi City County. The problem is that due to poor planning and organization of PPP Projects, existence of ineffective and/or lack of policy and institutional and legal frameworks lead to challenges during the implementation process and that would not be in tandem with the overall objective of Nairobi City County government to provide the required public good.

     Objectives of the study

The main objective of this study was to find out the challenges that face the implementation of Public Private Partnership Projects in Nairobi City County.

Specific objectives

  1. To examine how the policy framework on PPP, at Nairobi City County influences the implementation of Public Private Partnership Projects.
  2. To examine how the institutional framework on PPP at Nairobi City County influences the implementation of Public Private Partnership Projects
  • To examine how the legal framework on PPP at Nairobi City County influences the implementation of Public Private Partnership Projects.
  1. To examine how the planning of public private partnership projects by Nairobi City County influence the process of project implementation of Public Private Partnership Projects.
  2. To examine how cost sharing between diverse players in a PPP project at Nairobi City County influences the implementation of Public Private Partnership Projects.

Research questions

  1. How does the policy framework on PPP at Nairobi City County influence the implementation of Public Private Partnership Projects?
  2. How does the institutional framework on PPP at Nairobi City County influence the implementation of Public Private Partnership Projects?
  • How does the legal framework on PPP at Nairobi City County influence the implementation of Public Private Partnership Projects?
  1. How does the Project planning of PPP by Nairobi City County influence the process of project implementation of Public Private Partnership Projects?
  2. How does cost sharing in a PPP Project at Nairobi City County influences the implementation of Public Private Partnership Projects?

      Significance of the study

This study is significant and important because it will put into perspective a clear picture of the policy framework in place and the planning, communication and organization process of implementing a project in a public private partnership arrangement with private firms as well as individuals at large. It will further be an eye opener on those issues and/or areas that need to be addressed in order to facilitate a smooth implementation of public private partnership projects in Nairobi City County. The study will also benefit researchers in the field of project management and other scholars intending to do a study in project implementation. By and large, the study will also embellish the existing discourse on efficient implementation of public private partnerships.
LITERATURE REVIEW

     Theoretical review

Below is an extensive discussion of the theories that inform on the subject of Public Private Partnership in project implementation.

   Agency theory

This theory stipulates the underlying assumptions about the exercise of property rights and gives guidance in the writing of contracts that define organizations (Nguri, 2009). The theory particularly informs on relationships between the principal and the agent who act on behalf of the organization.
According to this theory the principals must deal with two basic issues in selecting, choosing and controlling their agents: first, they have to select the best agents, whether employees or contractors, and create incentives for them to behave as principals’ desire. Second, they have to check closely through monitoring the behaviour of their agents to make sure that they are working and performing as agreed (Ayee, 2005). Problems such as Information asymmetry spring up when there is a goal conflict between the parties or when the process of verification of what the agent is doing becomes difficult or expensive for the principal.
The principal-agency relationship exists in a PPP Project between the Public as the Principal and the private party being the agent. If the relationship between the two parties is not well articulated, then the problems associated with the agency theory, like the information asymmetry would normally occur (Nguri, 2009). The quality of the participants and the relationships among them and how it is thought out at the beginning determines the success or failure of a PPP Project (Wallin, 1997).
      Implementation theory
Michael, H. and Peter, H. (2006) argue that implementation studies started in the 1970s when Erwin Hargrove (1975) wrote of the ‘missing link’ in the study of policy processes. This was the missing link between policy formation and policy outcomes, as efforts to develop government interventions to address social problems of various kinds were rapidly increasing, and there was awareness that these interventions were often ineffective.
Pressman and Wildarsky (1984) view implementation in terms of a relationship to policy as laid down in official documents. They say, ‘a verb like “implement” must have an object like “policy”’, and that policies normally contain both goals and the means for achieving them. They argue that “if action depends upon a number of links in an implementation chain, then the degree of co-operation between agencies required to make those links has to be very close to a hundred per cent if a situation is not to occur in which a number of small deficits cumulatively create a large shortfall”
The complexity of implementation is found in the top-down/bottom-up debate which was heavily influenced by the question of how to separate implementation from  policy formation, that was only part of a wider problem about how to identify the features of a very complex process, occurring across time and space and involving multiple actors (Hill, M. and Hupe, P., 2006).
Klijn and Koppenjan (2000) are of the idea that policy processes are an interplay between various actors and not centrally governed and this is important in implementation because it creates a network concept in implementation where the success or failure of policy processes are based on the extent of co-operation achieved and that it is pegged on the degree to which actors are aware of their mutual dependencies.
Van Meter and Van Horn`s (1975) developed there theoretical framework on implementation as guided by organization theory, and particularly work on organizational change, studies of the impact of public policy and particularly of the impact of judicial decisions and some studies of inter-governmental relations. They suggest that there is a need to take into account the amount of change required and the level of consensus. Hence they hypothesize that implementation will be most successful where only marginal change is required and goal consensus is high.

      Partnership theory

The term ‘partnership’ first appeared in business law where it refers to a contract for sharing fairly the profit and loss of a joint business. This concept of a partnership as a fair division of profit and loss has been translated into the organizational development and management fields (Linder, Quill, and Aday 2001).
Organizations generally join together in pursuit of self-interest, which may be shared with or differ from other stakeholders. The partnership must, however, develop a shared purpose, with a common understanding of the problem and the role of each organization in addressing the problem (Wood and Gray 1991). Motivations must be explicit for joining a partnership, allowing for discussion of differences and development of ways to accommodate any differences
The concept of partnership in service delivery arose, during the 1980s and 1990s, as a canon of public policy and private enterprise (Knox, 2002).  The OECD (1990: 18) has defined partnerships as: “Systems of formalized co-operation, grounded in legally binding arrangements or informal understandings, co-operative working relationships, and mutually adopted plans among a number of institutions. They involve agreements on policy and programme objectives and the sharing of responsibility, resources, risks and benefits over a specified period of time.”
Organizational motivations provide further explanation for the increasing interest in partnerships. While these motivations are not specific to a particular field, they are relevant to any study of organizations. Where motivations between partners are incompatible, many partnerships fail. Interests in partnership involve mutual benefits that range from additional resources, increased credibility, and better understanding and responsiveness to community needs, among others (Kreuter and Lezin 1998). Resource dependency theory confirms the search for additional resources as a motivation for partnerships, where the decline in federal and state resources, for example, led organizations to look to other organizations (Bardach 1998). Promotion of collaboration by government may stem from a desire for social services providers to do more with less, working within the status quo rather than challenging it (Himmelman 2001). Of note is the possibility that partnerships can be misused by dominant partners to maintain the status quo and simply as a way to garner resources to replace decreasing governmental resources (Rossi Steinberg and Baxter 1998).
Promoting ‘partnership’ and greater inter-agency co-operation between government departments, public agencies, private companies and the third sector has become a staple of strategies to promote social and labour market inclusion at national and supra-national levels, for instance internationally (CEC, 2003, 2001: 6; OECD, 2008) and the United Kingdom (UK) (DWP, 2006).  Area-based strategies to tackle social and labour market exclusion have particularly used of partnership approaches involving different organizations and forms of relationship – for the UK government, ‘renewal relies on local communities’, and non-public bodies have a leading role to play in promoting employability, regeneration  and  inclusion  (SEU,  2001;  McQuaid  and  Lindsay,  2005; McQuaid et al., 2007).
Uhlik (2007) alludes that “Partnership” within the context of a theory     of partnership is a transforming relationship oriented toward the mutual achieving of meaningful goals. This conception captures both the idealism implicit in the term’s common (non-economic) use and the social contract’s “freedoms” suggested by mutuality and transformation. But transformation is predicated     on thoughtful   action,  which  in turn requires meaningful awareness.

   Organization theory

The challenges facing organizations today are quite different from those of the past, and thus the concept of organizations and organization theory is evolving (Daft R., L., 2007). Surveys of top executives indicate that copying with rapid change is the most common problem facing managers and organizations.
Organizational dimensions fall into two types: structural and contextual. Structural dimensions provide labels to describe the internal characteristics of an organization. They create a basis for measuring and comparing organizations. Contextual dimensions characterize the whole organization, including its size, technology, environment, and goals. They describe the organizational setting that influences and shapes the structural dimensions. Contextual dimensions can be confusing because they represent both the organization and the environment. Contextual dimensions can be envisioned as a set of overlapping elements that underlie an organization’s structure and work processes. To understand and evaluate organizations, one must examine both structural and contextual dimensions. These dimensions of organization design interact with one another and can be adjusted to accomplish the purpose of the organization (Hall R., H., 1991)
To a great extent managers and organizations are still imprinted with the hierarchical, bureaucratic approach that arose more than a centuary ago. Yet the challenges, presented by today’s environment-globalization, ethical concerns, rapid advance in technology, the rise of e-business, a shift to knowledge and information as organizations most important form of capital and the growing expectations of workers for meaningful work and opportunities for personal and professional growth-call for dramatically different responses from people and organizations. The perspectives of the past do not provide a road map for steering todays organizations. Managers can design and orchestrate new responses for a dramatically new world. In fact, Organization theory is not a collection of facts; it is a way of thinking about organizations, a way to see and analyze organizations more accurately and deeply than otherwise could and a way to see and think about organizations based on patterns and regularities in organizational design and behavior (Daft R., L., 2007).
Many managers are redesigning their companies towards something called the learning organization. The learning organization promotes communication and collaboration so that everyone is engaged in identifying and solving problems, enabling the organization to continuously experiment, improve and increase its capability. The learning organization is based on equality, open information, little hierarchy, and a culture that encourages adaptability and participation, enabling ideas to bubble up from anywhere that can help the organization seize opportunities and handle crises. In a learning organization the essential value is problem solving, as opposed to the traditional organization designed for efficient performance (Hall R., H., 1991)

     Conceptual framework

The diagram below is a conceptual framework depicting the independent variables and the dependent variable

Figure 1; Conceptual framework

Independent variables                                                     Dependent variable
 
  
 Source: (Researcher, 2015)

     METHODOLOGY

      Research design

The research was carried out through a descriptive research design and data was collected and analyzed in order to describe the implied phenomenon (Reid, 1998) among the administrators of PPP projects in Nairobi City County.  The survey was conducted at Nairobi City County offices and– specifically the departments that have/had projects implemented through a PPP arrangement i.e. the Finance and Economic Planning Sector. The study was conducted within the month of April 2015
Target population
The researcher targeted all the staff in the Finance and Economic Planning sector at Nairobi City County which is responsible for policy formulation and leadership in Public Private Partnership among other responsibilities (Human resource department NCC, 2015). This sector has a total of 917 workers. Of this target population the accessible population was 50% i.e. 456 people due to the constraint of time and resources (Mugenda and Mugenda 2003)

 Table 1; target population

CategoryNumber of people
Chief Officers1
Directors1
Managers7
Supervisors14
Subordinates894
Total917
Source: (Finance and Economic planning sector NCC, 2015)

      Sample design

The research used a random sampling procedure to stratify, cluster and divide the target population into homogeneous segments.

      Sampling Procedures and sample size

Mugenda and Mugenda (2003) say that where time and resources allow, a researcher should take as big a sample as possible. In this instance there was limited time and resources and as such I relied on a small sample size. This sample was determined through first dividing the total population into groups called strata based on NCC departments. The researcher then divide the strata into manageable groups (sections within the departments) known as stratum using job designations and this constituted the sample size using stratified sampling method. The strata are more homogeneous than the total population. This helped the research to get more and precise estimate of the stratum. Finally, since this was a descriptive study, the sample size was 10% of the accessible target population (Mugenda and Mugenda, 2003). Of the 456 10% constituted 45.6 people and since there cannot be a 0.6 person I rounded the figure upwards to 46 persons i.e. 1 chief officer, 1 Director, 1 managers, 2 supervisors and 41 subordinates’ making a total sample size of 46 people selected using simple random sampling technique so as the sample size to be acceptable and feasible in terms of cost, time and resources (Baridalyne Nongkynrih, 2012). In order to ensure a representative sample, simple random sampling was undertaken from each ‘stratum’ i.e. staff in the department based on year of service, responsibilities and the type of duty assigned to the employee.

      Data collection techniques

The researcher used questionnaire for primary data collection. And a literature review was conducted for secondary data collection.

Data collection instruments

The instruments used were first tested by debugging for reliability and validity. The reliability test was conducted using the test-retest technique which involves administering the same instrument twice to the same group of subjects and the validity tests entailed assessing construct validity by measuring the degree to which data obtained from the instrument meaningfully and accurately reflects or represents a theoretical concept (Mugenda and Mugenda 2003). The questionnaire was used for data collection because, it offers considerable advantages in administration, and presents an even stimulus potentially to large numbers of people simultaneously and provides the investigation with an easy accumulation of data (Kiess and Bloomquist, 1985).

Questionnaires

The researcher distributed similar questionnaires to the target sample. The questionnaire had both open ended and closed ended questions.

      Secondary data

This was done by reading what other researchers have done about PPP projects in papers, magazines, journals, books and project implementation reports and minutes from various projects presented to Nairobi City County, Kenya and other parts of the world. The information collected was compiled under Literature review.

      Data Analysis

To permit quantitative analysis, data was converted to numerical codes in terms of variables attributes (Mugenda and Mugenda 2003). The data was then analyzed using the Statistical Package for Social Sciences (SPSS) to come up with tables, charts, and graphs. The tables, charts and graphs were then interpreted accordingly in terms of the evidence that they presented.

      RESULTS

      Response rate

The respondents participated in the exercise in demographic questions as shown in table 1. The researcher picked a sample of 46 people from the population of 917. Of the 46, 45 of them returned their questionnaire this represented 97.82% which is significant enough to provide a basis for valid and reliable conclusions. The respondents indicated their designation, department/section where they worked, number of years worked in that department/section and level of education.

Table 2:  Response rate on demographic questions

  
 Designation of respondentDepartment/section of respondentNumber of years worked in department/sectionLevel of education 
NValid45454545 
Missing0000 
Mode  6.003.00 
Source: (survey data 2015)
From the table 2 above it is evident that most of the respondents years of working were 6 years and above and their level of education was above college. This is a good representation to rely on their response for purposes of analysis, and significant enough to provide a basis for valid and reliable conclusions and recommendation

Table 3 Designation of respondent

  FrequencyPercentValid PercentCumulative Percent
ValidAccountant22 48.948.9
Inspector1431.131.180.0
Secretary920.020.0100.0
Total45100.0100.0 
Source: (survey data 2015)

Figure 1:  Designation of respondent

Source: (survey data 2015)
From the table 2 and figure 1 above most of the respondents were working as accountants (48.9%), inspectors (31.1%) and secretaries (20%) in the Finance and Economic Planning Sector that is charged with the responsibility of overseeing PPP Projects. This are Knowledgeable people on issues of Policy, Institutional and Legal Framework, leave alone Participate in the planning activities of the Sector.

Table 3; Department/section of respondent

 
  FrequencyPercentValid PercentCumulative Percent
ValidFinance1022.222.222.2
Inspectorate2351.151.173.3
Licensing1226.726.7100.0
Total45100.0100.0 
Source: (survey data 2015)

Figure 2:  Department/section of respondent

Source: (survey data 2015)
From the table 3 and figure 2 above the respondents from various departments were as distributed as follows: Finance (22.2%), inspectorate (51.1%) and Licensing (26.7%). This Sections have a daily direct contact of all the activities going on in the Finance and Economic Sector leave alone the entire NCC activities

Table 4: Level of education

  
  FrequencyPercentValid PercentCumulative Percent 
Validsecondary24.44.44.4 
College2453.353.357.8 
undergraduate1942.242.2100.0 
Total45100.0100.0  
Source: (survey data 2015)
Table 4 above shows that the level of education for most of the respondents were college graduates (53.3%) and undergraduate constituting (42.2%). others were secondary school leavers at (4.4%). The same is represented by figure 4.2.3 below. Once again this is significant enough to rely on their response for purposes of analysis, and significant enough to provide a basis for valid and reliable conclusions and recommendation

Figure 3:  Level of education

 
  
Source: (survey data 2015)

Source: (survey data 2015)

4.3  Personal view on PPP projects at Nairobi City County

Table 5. Involvement in selection of PPP  projects in Nairobi City County

  FrequencyPercentValid PercentCumulative Percent
ValidActively involved817.817.817.8
Not involved at all3782.282.2100.0
Total45100.0100.0 
Source: (survey data 2015)
The table 5 above shows that (82.2 %) of the respondents are not involved in selection of PPP projects in Nairobi City County. Those that are actively involved constitute only (17.8%). This is also supported by figure 4 below. This does raise a lot of eye brows as to how the implementation of PPP projects is undertaken baring in mind the fact that these employees will be involved in licensing, Inspection, and all financial issues relating to the PPP projects.
Figure 4 Involvement in selection of PPP projects in Nairobi City County

Source: (survey data 2015)

 Descriptive Analysis

Policy framework for PPP at NCC and its influence on the implementation of PPP projects
Policy Supports Implementation

Table 6. Policy framework and project implementation at NCC

 
  FrequencyPercentValid PercentCumulative Percent
ValidStrongly disagree36.76.76.7
Disagree1431.131.137.8
Neutral1533.333.371.1
Agree1226.726.797.8
Strongly agree12.22.2100.0
Total45100.0100.0 
Source: (Survey data 2015)
The study from the table 6 above shows that most of the respondents are either neutral (33.3%) or disagree (31.1%) and those that strongly disagreed constituted only (6.7%) on whether the policy supports implementation. while those who strongly agreed constitute only (2.2%) and those that agree are only (26.7%)  of the respondents. This shows that many respondents have very little information on whether the existing policy framework supports implementation.
This is attributed to the fact that majority (82.2%) have not been involved in selection of projects to be implemented through PPP program at Nairobi City County as earlier shown in table 4.3.1.  The respondents also did not know whether the current policy framework creates a conducive environment for all partners to undertake their responsibilities in the project as shown in figure 4.4.1 below: (mean 2.87).

Figure 5; Policy framework and project implementation at NCC

          Source: (Survey data 2015)

 Policy provides a Conducive environment

Table 7; Conducive environment

  FrequencyPercentValid PercentCumulative Percent
ValidStrongly disagrees12.22.22.2
Disagree1942.242.244.4
Neutral1022.222.266.7
Agrees1431.131.197.8
Strongly agrees12.22.2100.0
Total45100.0100.0 
Source: (survey data 2015)
The table 7 above shows that the policy framework at NCC does not provide a conducive environment to aid implementation of PPP Projects as (2.2%) strongly disagrees, (42.2%) disagree, and (22.2%) are neutral. However (31.1%) agree to a conducive environment while only (2.2%) strongly agree. Once again staffs are not involved in policy formulation and may not be aware how the existing policy framework for PPP works.
Policy framework supports project objectives

Table 8; Policy framework supports project objectives

  FrequencyPercentValid PercentCumulative Percent
ValidDisagree2044.444.444.4
Neutral1226.726.771.1
Agree1328.928.9100.0
Total45100.0100.0 
Source: (Survey data 2015)
Majority of the respondents i.e. (44.4%) attest to the fact that the current policy framework does not support PPP Project objectives. This is further confirmed by (26.7%) who express a neutral stand. This makes those people who either disagreed or are neutral total to (71.1%). On the other hand only 28.9%) agreed that the current policy framework support PPP Project Objectives. This shows that only a small number of the department staff may have been actively involved in the PPP project implementation.
Policy framework is updated to current PPP issues

Table 8; Policy framework is updated to current PPP issues

  FrequencyPercentValid PercentCumulative Percent
ValidStrongly disagree12.22.22.2
Disagree1942.242.244.4
Neutral1022.222.266.7
Agree1431.131.197.8
Strongly agree12.22.2100.0
Total45100.0100.0 
Source: (Survey data 2015)
Equally, majority of the respondents i.e. (42.2%) attest to the fact that the current policy framework is not updated to current PPP issues. This is further confirmed by (22.2%) who express a neutral stand thus a total of (66.7%). On the other hand only (31.1%) and (2.2%) agreed that the current policy framework is updated to current PPP issues. This can be attributed to the fact that the policy framework for PPP Projects has not been reviewed recently and aligned to current PPP Project issues.
4.4.1.4 Policy and project budgets
The table 9 below shows that a total of (46.7%) respondents either strongly disagreed or disagree as to whether the current PPP Project budgets, allocation and expenditures do adhere to Project policy framework for PPP at Nairobi City County. While (24.4%) were neutral and (26.7%) agreed with a 2.2% strongly agreeing that budgets, allocations and expenditures adhere. This is consistent in all respondents’ issues on matters of PPP policy at Nairobi City County.

Table 9; Policy and project budgets

  FrequencyPercentValid PercentCumulative Percent
ValidStrongly disagree36.76.76.7
Disagree1840.040.046.7
Neutral1124.424.471.1
Agree1226.726.797.8
Strongly agree12.22.2100.0
Total45100.0100.0 
Source: (Survey data 2015)
Institutional framework for PPP at NCC and its influence in implementation of public partnership projects
This objective was to examine the extent to which the Institutional framework at NCC supports the implementation of PPP projects at NCC. The findings are summarized and described in the tables below:

Table 10; Institutional framework at NCC and support for PPP implementation

 
  FrequencyPercentValid PercentCumulative Percent
Validdisagree1840.040.040.0
neutral1022.222.262.2
agree1737.837.8100.0
Total45100.0100.0 
Source: (Survey data 2015)
From the table 10 above a total of (62.2%), with (22.2%) neutral and (40%) disagree that the Institutional framework at NCC supports PPP Project Implementation. On the other hand (37.8%) agreed that the Institutional framework at NCC supports PPP Project Implementation. This is attributed to the fact that most of them were not involved in project selection and implementation in the first place.

Table 11; Institutional framework at NCC and regulations guiding implementation of PPP at NCC

 
  FrequencyPercentValid PercentCumulative Percent
ValidStrongly disagree12.22.22.2
Disagree2044.444.446.7
Neutral1124.424.471.1
Agree1226.726.797.8
Strongly agree12.22.2100.0
Total45100.0100.0 
Source: (Survey data 2015)
Likewise the table 11 above show a total of (71.1%), with (24.4%) neutral and (44.4%) disagreed that there are regulations at NCC guiding PPP Project Implementation. On the other hand (26.7%) agreed that the Institutional framework at NCC has regulations guiding PPP Project Implementation. This is attributed to the fact that majority of the respondents indicated that they were not involved in project selection thus do not know the existing regulations for PPP implementation.

Table 12 institutional framework does not contravene partner’s interests in PPP

 
  FrequencyPercentValid PercentCumulative Percent
Validdisagree1840.040.040.0
neutral1226.726.766.7
agree1533.333.3100.0
Total45100.0100.0 
Source: (Survey data 2015)
In terms of contravening partners interests the respondents from table 12 above it show that (40%) disagreed and (26.7%) were neutral as to whether the Institutional framework contravenes partner’s interests in PPP Projects at NCC. On the other hand (33.3%) did agree that the framework was not contravening partner’s interests in PPP Projects.

Table 13; Institutional framework regulations allow the monitoring and evaluation of project implementation

 
  FrequencyPercentValid PercentCumulative Percent
ValidDisagree1635.635.635.6
Neutral1226.726.762.2
Agree1737.837.8100.0
Total45100.0100.0 
Source: (Survey data 2015)
The table 13 above diverts from the normal response by showing a higher number of respondents i.e. (37.8%) agree that regulations allow the monitoring and evaluation (M&E) of PPP Project Implementation at NCC. This is partly due to the fact that most respondents work in the finance, and Inspectorate department of NCC that deal with M&E. However (35.6%) disagreed and (26.7%) were neutral a total of (62.2%) being consistent with the data collected in all categories.
Respondent opinion on project manager’s adherence on set out regulation

Table 14: How often are NCC projects policies followed by project managers?

 FrequencyPercentValid PercentCumulative Percent
Validalways24.44.44.4
sometimes1942.242.246.7
never1431.131.177.8
Don’t know1022.222.2100.0
Total45100.0100.0 
Source: (Survey data 2015)
Most of the respondent who were asked of their personal opinion on whether project managers adhere to set out regulations responded with a (4.4%) agreeing that Project Managers always adhered to set out regulations, (42.2%) indicated that sometimes Project managers did adhere to the set out rules and regulations, (31.1%) indicated that Project Managers never adhered and (22.2%) did not know whether project managers did adhere to the set out rules and regulation.
Legal framework for PPP at Nairobi City County and influence in implementation of PPP projects
All the respondents (100%) indicated that there is a legal framework for PPP implementation at Nairobi City County and does influence implementation of PPP projects as shown in table 4.4.4.1 below:

Table 15; Legal framework for PPP at NCC that guide implementation of PPP projects?

  FrequencyPercentValid PercentCumulative Percent
ValidYes45100.0100.0100.0
Source: (Survey data 2015)

Table 15; if yes is the existing legal framework legal framework for PPP sufficient for PPP?

  FrequencyPercentValid PercentCumulative Percent
Validstrongly disagree1533.333.333.3
disagree3066.766.7100.0
Total45100.0100.0 
Source: (Survey data 2015)
On the same breath the table 15 above shows (66.7%) disagree that the existing legal framework for PPP is sufficient for PPP projects implementation, and (33.3%) strongly disagreed of the same. This may be due to inexistence of a laid down legal framework or PPP or lack of respondent participation in formulation of the legal framework.

Table 16; legal issues between partners in PPP projects met optimally by current legal framework

  FrequencyPercentValid PercentCumulative Percent
Validdisagree1840.040.040.0
neutral1328.928.968.9
agree1328.928.997.8
strongly agree12.22.2100.0
Total45100.0100.0 
Source: (Survey data 2015)
Equally, (40%) disagreed that legal issues between partners in PPP projects relating to project implementation are met optimally by the current legal framework and (28%) of the respondents did remain neutral, while (28.9%) agreed and a (2.2%) having a strong conviction that Legal issues between Partners are met optimally-table 16 above.

Table 17 the legal system at NCC for PPP allows resolving implementations disputes quickly to allow project completion within project time objectives

  FrequencyPercentValid PercentCumulative Percent
Validstrongly disagree12.22.22.2
disagree1942.242.244.4
neutral1328.928.973.3
agree1226.726.7100.0
Total45100.0100.0 
Source: (Survey data 2015)
Table 17 shows that (42.2%) disagreed, (2.2%) Strongly disagreed that the legal system at NCC for PPP does allows resolving implementations disputes quickly. In fact, (28.9%) were neutral and (26.7%) agreed that the legal system allows resolving of implementation disputes in time to meet project time objective. This could be attributed to non conversant to project implementation legal issues.
Planning of PPP projects by NCC
This objective aimed at examining how the planning of PPP Projects by NCC influences the process of project implementation. The respondents did respond to a number of statements as summarized by the table and figures below:

Table 18; Planning and SMART objectives

  FrequencyPercentValid PercentCumulative Percent
ValidDisagree1737.837.837.8
Neutral1328.928.966.7
Agree1328.928.995.6
strongly agree24.44.4100.0
Total45100.0100.0 
Source: (Survey data 2015)
The respondents indicated that; on whether projects have SMART objectives (37.8%) disagreed while (28.9%) were neutral, and another (28.9%) did agree and a (4.4%) strongly agreed as shown in table 18 above.
Actually a majority of respondents don’t know whether activities and tasks are documented and well laid down as shown in figure 5 below (mean 2.87). The same applies as to whether partners participate during the planning process as shown with the following (mean 2.78) in figure 6 below. Majority of respondents also showed that they did not know whether projects are executed as per laid down plan (mean 2.98) in figure 7 below. As to whether resources are utilized as per laid down plan respondents indicate of the same view (mean 2.91) figure 4.4.5.4. As to project schedule being adhered to as shown in figure 8 with (mean 2.91) the same view is still held by the respondents. Finally, on whether the projects are completed as per planned schedule a (mean 2.98) is shown in figure 9 indicating respondents are neutral. This shows that the respondent’s level of involvement in PPP project planning is very minimal.

Figure 5 Activities and tasks documentation

Source: (Survey data 2015)

Figure 6 Partners Participation in Project Planning

Source: (Survey data 2015)
Figure 7 Planning and Project execution as per laid down Plan
 
Source: (Survey data 2015)

Figure 8 Resource Utilization as per laid down plan

 
Source: (Survey data 2015)

Figure 9 Project Schedule adhered to

Source: (Survey data 2015)

Figure 10 Projects Completed as per planned schedule

Source: (Survey data 2015)

Cost sharing between diverse players in PPP project at NCC influences the implementation of PPP project
The aim of this objective is to examine how cost sharing between diverse players in PPP Projects at NCC influences the implementation of PPP Projects. The respondents did respond to a number of statements as summarized by the table and figures below:

Table 19 PPP enables availability of funds for project implementation

  FrequencyPercentValid PercentCumulative Percent
Validdisagree1635.635.635.6
neutral1328.928.964.4
agree1533.333.397.8
strongly agree12.22.2100.0
Total45100.0100.0 
Source: (Survey data 2015)
The respondents in table 19 above did not know whether cost sharing between players in PPP projects at NCC enables availability of funds for project implementation as indicated by (35.6%) disagreeing, (28.9%) remaining neutral. However, (2.2%) strongly agreed and (33.3%) did agree that cost sharing enables availability of funds. This is due to the fact that some project cost is so high that an individual institution may not meet it alone

Table 20; Project financing as a preferred form of financing for PPP Projects

  FrequencyPercentValid PercentCumulative Percent
ValidDisagree1635.635.635.6
Neutral1226.726.762.2
Agree1533.333.395.6
strongly agree24.44.4100.0
Total45100.0100.0 
Source: (Survey data 2015)
As shown above in table 20 majority of the respondents i.e. (35.6%) disagreed, with (26.7%) being neutral in terms of project financing as a preferred form of PPP financing. On the other hand (13.3%) agreed, while (4.4%) strongly agreed that it is the preferred form of PPP Project financing

Table 21; Cost sharing

  FrequencyPercentValid PercentCumulative Percent
ValidDisagree1840.040.040.0
Neutral1328.928.968.9
Agree1328.928.997.8
strongly agree12.22.2100.0
Total45100.0100.0 
Source: (Survey data 2015)
Cost sharing as a rationale for preparing financial plans and budget, asses risk, design finance mix and raise funds  for project financing (40%) disagreed and (28.9%) were neutral and at the same time (28.9%) agreed as to it. Only a minority of (2.2%) strongly agreed to it. This is due to the lack of involvement in PPP Projects.

Table 22; Knowledge base for project design, contractual arrangement  and financing

 FrequencyPercentValid PercentCumulative Percent
ValidDisagree1635.635.635.6
Neutral1328.928.964.4
Agree1533.333.397.8
strongly agree12.22.2100.0
Total45100.0100.0 
Source: (Survey data 2015)
Most of the respondents (35.6%) disagreed that a Knowledge base is required regarding project design, contractual arrangement for project financing to be possible, (28.9%) were neutral on the issue while (33.3%) agreed. However (2.2%) of the respondents strongly agreed that a Knowledge base for project design, contractual arrangement for the project financing is required.. This is due to fact that most of the respondent work in department that deals with NCC finance and implementation.

Table 22; Project financing challenges

 
  FrequencyPercentValid PercentCumulative Percent
ValidDisagree1635.635.635.6
Neutral1328.928.964.4
Agree1328.928.993.3
strongly agree36.76.7100.0
Total45100.0100.0 
Source: (Survey data 2015)
As shown above in table 22 majority of the respondents i.e. (35.6%) disagreed, with (28.9%) being neutral as to whether project financing encounters’ challenges (social/environmental) which are complex with respect to NCC Projects. However (28.9%) agree while only (6.7%) strongly agree. This may be attributed to the fact that majority of the respondents are in the finance and Inspectorate department.

Table 23; Do projects finish in specified time?

FrequencyPercentValid PercentCumulative Percent
45100.0100.0100.0
Source: (Survey data 2015)
All the respondents (100%) agreed that it is difficult to complete projects within the specified project time objectives. This is largely attributed to ineffective policy, institutional and legal frameworks and misappropriation of project funds by project implementers.

Table 24: Recommendation for effective PPP implementation

 
 FrequencyPercentValid PercentCumulative Percent
Validenough finance48.98.98.9
involvement of employees1328.928.937.8
good PPP policies2044.444.482.2
frameworks structures817.817.8100.0
Total45100.0100.0 
Source: (Survey data 2015)
The respondents own recommendations for effective implementation of PPP Projects at NCC good PPP Project policies (44.4%), followed by involvement of employees (28.9%) in Project Planning and implementation are required. This is then followed by existence of good structures (17.8%). Amazingly enough finance (8.9) does not matter a lot for effective PPP Implementation

CONCLUSIONS

The study concludes that policy, institutional, and legal frameworks plus project planning and Cost sharing are the greatest challenges to the implementation of PPP Projects at NCC. Policy framework will influence the planning, cost sharing and implementation of PPP. This will be supported by a clear Institutional framework that will provide rules and regulations that will guide project implementation. Equally a functional legal framework that is intended to facilitate a good working environment or solving disputes will enhance project completion within project time objectives.

RECOMMENDATIONS

The study recommends the following measures:
The findings indicate that there is no staff involvement in the selection of PPP Projects for implementation. As such the study recommends that staff at NCC Finance, Inspectorate and Licensing departments be involved in PPP project selection.
Equally a revision of the current Policy, Institutional and Legal framework needs to be done to be in line with the current requirements of implementing PPP projects. During this review staff from the relevant departments/sections to be fully involved
Finally the study recommends staff training on project Planning and Implementation to all an inclusive participation and understanding of the project life cycle and project objectives.

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