Contractual management in PPP projects: Evaluation of legal versus relational contracting for service delivery

The paper explores the extent to which effective relationships and legal factors are used to determine performance outcomes in public-private-partnership (PPP) procurement in the United Kingdom. The purpose is to demonstrate means for service improvement on PPP projects. PPP was formerly the public finance initiative for the construction and operation of complex services and facilities. Design, build, finance, and operate and design, build, and operate type contracts are considered. A legal-relational continuum is developed, relationships being assessed in terms of trust as an indicator of robustness, data being mobilized through action research and quantitative survey methods. It was found that there is variance in the perceived trustworthiness of clients in the context of their understanding and experience of PPP, and variance in support given to staff by their departments in developing relations was found to affect performance. A long-term tendency was identified to relinquish partnership relations in favor of legal and potentially adversarial contracting. Relationship management principles were also found to be lacking in both the public and private sector, relational contracting being predominantly reliant upon the behavior of individuals in their teams.