Business Case
Figure 4.26: Sample Outputs of Modelling of Fiscal Liabilities73
73
249
The above figures show the direct fiscal impact of a hypothetical PPP project. Direct fiscal impacts mainly derive from projects in which the concessionaire is paid by the contracting authority (via availability fees, services fees, etc.). In revenue-generating PPP projects, where the private party is paid directly by users of the asset, the direct fiscal impact is small or non-existent.
The Fiscal Liability Assessment should also examine the contingent liabilities that would be triggered by the occurrence of a specified risk or a compensation event. For example, a compensation for losses and damages if the right-of-way is delivered too late, losses and damages caused by a Force Majeure event such as an earthquake or a flood, or a payment due on an early termination of the PPP contract. Contingent liabilities affect both revenue-generating projects and projects paid by the government, through availability payments.
Source: IMF, PPP Fiscal Risk Assessment Model (PFRAM). Accessed June 2016
| Caribbean PPP Toolkit