Welsh PPP: MIM model moving forward

Mutual Investment Model: remember me?

Back in August 2020, your Decide Hub informed you of a specific type of contractual arrangement that took over the Public-Private Partnerships (PPPs) agenda in Wales, UK. Click here to access our news at the time.

The Mutual Investment Model, which in legal form and substance was akin to the Design Build Finance Own Operate Maintain and Transfer model, was defined by the Welsh Government as follows:

MIM schemes will see private partners build and maintain public assets.

 

In return, the Welsh Government will pay a fee to the private partner, which will cover the cost of construction, maintenance and financing the project. At the end of the contract the asset will be transferred into public ownership.

MIM schemes in the health sector are illustrated by the transformation projects focusing on the Cardiff’s Velindre Cancer centre. Further to the tendering out of this MIM scheme to strengthen and expand the Cancer Centre, Velindre University NHS Trust shortlisted three offers from three different consortia.

Interestingly enough and simultaneously, the Welsh Government is also launching a bid….to attract legal capacities to advise them on MIM schemes!

This is perhaps one of the main -and most controversial- features of complex contracts such as PPPs: at all stages, highly technical expertise is required, which often falls outside of the skill mix available within the project owner’s team.

 

This in turn risks prompting the question: how to ensure ownership and full grasp of the project if so many steps of the project rely that heavily on external capabilities?

At any rate, stay tuned as your Decide Hub will make sure to bring you the latest news on this project!

Click here to access the Velindre Cancer Centre website.