SOURCE’s Risk Allocation Matrix allows governments to verify the risk allocation of their PPP project draft contracts according to international best practices.
The PPP Risk Allocation Tool in SOURCE, developed in collaboration with the Global Infrastructure Hub (GIH), provides a high-level summary of the key risk allocation of the project, resulting from the project structuring as described in the preparation stages. For each risk and each infrastructure subsector, the standard market practice is embedded into SOURCE, and a flag is raised when the project allocation differs the best practice defined by the World Bank’s Guidance on PPP Contractual Provisions.
When the risk allocation differs from the typical allocation identified as best practice, a red or yellow flag will appear in the module to notify the project coordinator about the potential revision of the risk allocation or justification to be provided by a comment on the project specificity. This functionality will not only support governments in assessing its risk allocation but also at the subnational level, which may lack PPP technical knowledge. SIF is also planning to develop the same functionality for traditional procurement in the coming months.
Figure shows the construction risk allocation allocated as “Shared” on the SOURCE project, and the typical allocation being “Private”