The procurement of
infrastructure projects via public-private partnerships (PPPs) is rising
globally. PPPs are, however, often characterised by lengthy tendering periods,
defined as the difference between contract notice and financial close.
Tendering periods are important because they account for a significant
proportion of overall project delivery time. Slow tendering deters bidders and
thus reduces competition for contracts. We source data on 670 PPP projects in
the UK and use a duration analysis model to empirically examine factors that
impact tendering period duration. Our results reveal significant sectoral
variation with projects in the health and housing sectors taking significantly
longer to reach financial close. We
also show that, after controlling for other factors, projects with higher
capital values and projects that overlap with
the timing of general elections are
associated with significantly longer tendering periods.
We further examine the impact of the competitive dialogue procurement method
and find evidence that
tendering periods have increased since 2006; the year competitive dialogue was
introduced. We do, however, observe a significant
reduction in the time between appointment of preferred bidder and financial
close post-2006. This suggests that competitive dialogue is effective in
reducing the scope for negotiations by preferred bidders holding quasi-monopoly
advantages.