The Department of Defense has taken advantage of public-private partnerships (P3s) to upgrade its infrastructure for family housing and utilities, and to develop new on-base sources of renewable energy, but there are a host of other areas for the department to leverage private sector investment, according to a recent commentary in Government Executive.
Nick Greenwood, managing director of the infrastructure advisory group for KPMG LLP, points to the United Kingdom, where its Ministry of Defence has relied on P3s for a variety of infrastructure needs along with an array of military and support services. P3s have been used to refurbish the ministry’s main building in Whitehall, consolidate its real estate in London and rebuild the government’s communications headquarters.
Project Allenby/Connaught — a partnership between the ministry and a joint venture involving Carillion and KBR — has resulted in a $2.2 billion, eight-year construction program focused on housing for single soldiers but also covering offices, stores, and training, dining and recreational facilities. In addition, the $12 billion, 35-year project encompasses an array of support services including catering, cleaning, transport, property management, document production and waste disposal.
“P3s have also been used to provide family housing, simulator-based training, search and rescue services, fixed telecommunications, roll-on and roll-off ferries, air-to-air refueling, air transport services and much more,” Greenwood states.
As DOD faces ever-tightening budgets for installations services and further cuts in end strength, P3s would help the government avoid the need to provide upfront funding as well as take advantage of private sector innovation.
Partnerships also can shorten construction timelines and transfer risk to the private sector, he said. “The UK National Audit Office found that 70 percent of traditional design, bid, and build construction contracts were delivered late and 73 percent were over budget, which fell to 24 percent and 22 percent for P3s respectively,” Greenwood states.
He acknowledges, however, that DOD may need new legislative authorities to expand its use of P3s.
“Given the extent of DOD’s challenging long-term budget realities, now could be the time to closely examine whether additional P3s can reduce infrastructure investments and operating costs,” he concludes.