Abstract This paper aims to study the contracts of the Portuguese Public-Private Partnerships (PPP) of the motorway sector which represent an important part of the Annual Portuguese State Budget, as well as a crucial contribution to the Portuguese Public Debt. Once the formulae determining annual rents due to the private partners depend on stochastic variables, their simulation is binding. Otherwise, the Public Finances can suffer large losses. Our study is essential aiming to defend the Public interest and the political transparency as well as to present tools to prevent future excessive costs. In order to perform a simulation of the PP rents we started by describing the related contracts and analysing the mathematical formulae therein, following an insightful look and a descriptive analysis the historical data. Finally, a stochastic simulation study of the injury accident rates allowed us to calculate their rates as well as their renting implications. The simulated values are in accordance with our previous analysis, showing the existence of negative values for bonuses and penalties in the contracts. We discover the existence of an important trend: the bonuses increase and the penalties decrease when regarding symmetric variations in the fatal accident rates. This results in a strong and negative impact in the Portuguese Public Treasure. For the first time numerical flaws present in PPP contracts were systematically analysed by using a new statistical tool. This approach fills a gap when we are dealing with these issues allowing the partners to decide in a well informed manner.
Stochastic simulated rents in Portuguese public-private partnerships
Transportation Research Part A: Policy and Practice ; 130 ; 107-117
2019-09-09
11 pages
Article (Journal)
Electronic Resource
English
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