Edward Farquharson on the importance of contract management in PPPs

The importance of contract management in Public-Private Partnerships (PPPs) was highlighted by Edward Farquharson, Senior Adviser of the European Investment Bank (EIB), emphasising that the success of such collaborations depends largely on the quality of the contract and its proper implementation.

Farquharson, speaking on the second day the international summit 'Unlocking Investment Through PPP ', stressed that contract management is an active business activity for the contracting authority, which bears the ultimate responsibility for ensuring the provision of quality infrastructure and services to the public. Change, he explained, is inevitable in such partnerships, and “the ability to distinguish between everyday issues and more significant, unexpected events is vital”. In critical situations, the contracting authority must know when to seek the assistance of specialized experts, he emphasized, addressing the business community and public bodies.

A key element of successful project management, he said, is moving from an input-focused approach to an output-oriented model. Farquharson also stressed the need for partnership stability and problem-solving to improve performance. Prevention is always better than cure, and regular and documented meetings play a crucial role in avoiding problems and maintaining transparency between the parties involved, he added.

Proper contract management requires a wide range of tools, from management manuals to clearly defined decision-making structures and performance monitoring mechanisms. The frequency and purpose of meetings between the contracting authority and the project company should be prescribed, ensuring that communication is continuous and effective, was another valuable piece of advice.

The data collected and the reports generated enable informed decisions to be made and potential disputes to be effectively managed, he explained. Furthermore, he argued that the handover process after the contract expires should start five to seven years earlier to ensure that the infrastructure and services are maintained in excellent condition and the transition is smooth.

Successful contract management requires strategic preparation and long-term planning. Farquharson highlighted the importance of building a strong team before the project is financially complete, as well as securing the necessary resources for the duration of the contract.

A proactive approach and maintaining a consistent contract management process are crucial to the success of the project. According to him, consistency in the application of contract terms, formality and documentation of all actions are key factors that contribute to the provision of high quality services in the long term.

In closing, Farquharson stressed that contract management in PPPs is not only about complying with initial requirements, but also about continuously improving the quality of services provided. The ultimate goal should be to maintain a high level of service and ensure that investments bring lasting benefits to society.

The expert was speaking at a High Level Practical Workshop making up the second day of the 'Unlocking investment through Public-Private Partnerships (PPP)' International Summit in Nicosia.

The High Level Practical Workshop was designed to equip participants with the essential skills and strategies to develop compelling, investment-ready projects and effectively promote them to the right foreign direct investment (FDI) investors. Through expert insights, real-world case studies, and interactive sessions, attendees will learn how to structure projects to meet investor expectations, craft persuasive investment narratives, and utilise targeted promotion techniques to attract and engage the most suitable investors.

Speakers:

• Nayef S. Alhaddad, Manager of Research and Strategic Planning, Kuwait Authority for Partnership Projects (KAPP), Chairman, Middle East and North Africa Chapter, World Association of PPP Units and Professionals (WAPPP)
• Jean-Christophe Barth-Coullaré, International Mediator, Executive Director, World Association of PPP Units & Professionals (WAPPP)
• Edward Farquharson, Senior Adviser, European Investment Bank (EIB)
• Ziad-Alexandre Hayek, President, World Association of PPP Units & Professionals (WAPPP)
• Michael McVeigh, Director, Government and Infrastructure, EY
• Thibaut Mourgues, Managing Partner, Camden Advisory, Co-Founder, Head of Editorial Board, Head of AI & Technology chapter, World Association of PPP Units & Professionals (WAPPP)
• Ziad-Alexandre Hayek, President, World Association of PPP Units & Professionals (WAPPP)
• Lucia Fuselli, Chair of the Energy Chapter, Co-Chair of the Sustainability and Resilience Chapter, World Association of PPP Units & Professionals (WAPPP)

The Summit has been organised by Invest Cyprus, the World Association of Investment Promotion Agencies (WAIPA) and World Association of PPP Units & PPP Professionals (WAPPP).

EY Cyprus is Gold Sponsor, Hermes Airports is Silver Sponsor, and the European Investment Bank is the Knowledge Sponsor.