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GLOBAL INFRASTRUCTURE
The Changing Face o Inrastructure:
Public sector perspectives
Global research commissioned by KPMG International
rom the Economist Intelligence Unit
KPMG INTERNATIONAL
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© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
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Contents
About the survey 2
Foreword 3
KPMG’s view 4
The survey report 6
Appendix 13
Due to rounding graph totals may not equal 100 percent.
The World Bank denition o “governmental eectiveness” was provided to respondents during the
survey, and specied as “the quality o public services, the quality o civil service and the degree o its
interdependence rom political pressure, the quality o policy ormulation and implementation, and the
credibili ty o the government’s commitment to such policies.”
© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
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nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
The Changing Face o Inrastructure: Public sector perspectives
In order to understand the challenges that public sector ocials ace in creating and
maintaining inrastructure, the Economist Intelligence Unit (EIU), commissioned by
KPMG International, conducted a survey in November and December 2009 o 392
senior public sector ocials involved in inrastructure policy, procurement or
development. O these, 47% were at the level o senior manager or above. Thirty-
seven percent came rom organizations that operate at the city or local level, 28%
rom those at the state or regional level, and 35% at the national or ederal level. None
were elected ocials. Respondents came rom 50 countries and territories around the
world, including Europe (32%), North America (32%), Asia-Pacic (30%), Latin
America (3%) and the Middle East and Arica (3%).
About the survey
© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
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© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
This is the third inrastructure ocused survey that KPMG International has
commissioned rom the Economist Intelligence Unit (EIU). The rst survey looked
at views on inrastructure amongst business leaders generally. The second
surveyed those companies involved in the delivery o inrastructure. This time EIU
surveyed 392 senior public sector ocials involved in inrastructure policy,
procurement or development across the globe.
The headline result o this survey is that despite the belie that the stimulus monies
mobilized in the past two years will help in meeting medium-term inrastructure
needs, these unds still all well short o being a sustainable solution to the ar
greater long-term challenges o global inrastructure development. It is also clear
that given limited public sector resources, many governments and the private
sector would be well-advised to work better in partnership to deliver inrastructure
more eectively.
A renewed push or deeper collaboration is only one starting point. Many
governments ace dicult decisions as they try to balance budgets whilst
continuing to invest in inrastructure. Prioritization o inrastructure development is
critical to maintain economic growth and address the needs arising rom a growing
global population.
We believe it is important to continue to survey the views o leading individuals
concerned with inrastructure related issues and, in uture, we will be taking acloser look at the issues highlighted by this report. In the meantime, this survey
should oer industry leaders important issues to consider as well as a backdrop
against which to debate those issues.
Nick Chism
Head o Global Inrastructure
Partner, KPMG in the UK
Stephen Beatty
Americas Region Leader or Global Inrastructure
Partner, KPMG in Canada
Julian Vella
ASPAC Region Leader or Global Inrastructure
Partner, KPMG in Australia
Foreword
The Changing Face o Inrastructure: Public sector perspectives
As the global economy recovers rom the economic and nancial turmoil o 2008-2009,
it is crucial to refect upon next steps to support inrastructure development – a key part
o stimulus programs worldwide. Seeking views and opinions rom leading public
sector ocials involved in inrastructure has been a valuable exercise towards this end.
© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
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© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
The Changing Face o Inrastructure: Public sector perspectives
By bringing together the views and
opinions o these three groups, we
can get a better picture o where
the uture or the industry could lie.
Business leaders are saying that the
lack o inrastructure is holding backthe economy. Inrastructure
providers eel that the government
is not responding appropriately,
whilst public sector ocials think
that stimulus packages are an
inadequate solution. Unless a way
orward is ound, inrastructure
development could potentially
hinder economic growth across
the world. We rmly believe that the
solution should involve the public
and private sectors working closer
together in partnership.
Stimulus is only a start
Whilst the global nancial and
economic crisis have prompted
many governments to launch
stimulus packages and direct
unding towards inrastructure, this
initial unding only gets us over thestarting line in the longer term
challenge o meeting global
inrastructure needs. In the public
sector’s view, as refected in the
ndings o this survey, the
inadequacy o stimulus money
beyond addressing some near-term,relatively smaller-scale needs is
unequivocal: the lack o stable,
adequate, long-term nancial
resources is considered by
respondents the greatest
impediment or inrastructure
investment.
In terms o the stimulus packages,
spending ast and spending well
is a challenge in its own right.Governments around the world
want to spend stimulus money in a
manner that generates the greatest
possible economic impact in the
short term while also raising the
long-run productivity o the local
economy. These two aims are oten
complex to reconcile, especially in
the case o new build projects.
The nancial and economic crises
created this pathway or short term
stimulation. But is there a cost to
longer term inrastructure
investment or will these tangible
short-term benets whet the
appetite or making longer-term
investments a signicant priority?
Private sector involvement
is crucial
The public sector acknowledges
that the private sector should be
part o its solution or delivering
inrastructure more eectively.
The skills, resources and innovation
o the private sector, deployed
worldwide, alongside those o the
public sector, are needed to address
the inrastructure challenge.
However, it is important to
understand that the involvement
o the private sector alone cannot
solve governments’ long-term
inrastructure unding challenges.
Inrastructure must be unded rom
taxes raised, service charges levied
to users or contributions made by
third party beneciaries such asproperty developers.
KPMG’s view
This survey is the third in an ongoing series commissioned by KPMG International
rom the EIU. In prior editions we sought the views o private sector business leaders
across industries and inrastructure providers. In this current survey, we close the loop
with views rom the public sector.
KPMG’s interpretation o the survey results
© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
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nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
The Changing Face o Inrastructure: Public sector perspectives
A key to ensuring successul
cooperation and extracting value
rom limited unds is to nd
mechanisms or harnessing private
sector skills eectively. This survey
highlights some o the culturaldierences between the public and
private sectors as an important
barrier to address in this area.
The inrastructure industry should
consider ways to improve the
relationship between the public
and private sector and ocus on
incentivizing partnership behavior.
Governments can do better
Governmental eectiveness is an
issue – and not only in the eyes o
the private sector. Public sector
ocials surveyed put their hands up
and admitted: “Yes, we can do
better”. The public sector survey
respondents included suggestions
or more ocus on training,
increased transparency and
accountability, as well as taking
short-term political considerations
out o the process o planning how
best to manage long-term
inrastructure needs.
Competing objectives and
misaligned incentives appear to be
a major challenge. They exist, in
particular, in systems that
incentivize short-term thinking,
rather than thinking through the
long-term consequences o
inrastructure development. This
situation is oten made worse by a
lack o good quality inormation and
a lack o specialist skills.
First-class inormation can help
de-politicize inrastructure
Eective consultation o the
appropriate stakeholders is
paramount, whether in the context
o a new construction project or a
disposal o an existing piece o
inrastructure. The more open the
conversations, and the harder and
more robust the evidence base to
support process, the stronger the
consensus on the way orward.
Stakeholder consultation can help
in de-politicizing and increasing
transparency o decision-making on
inrastructure projects, two issues
highlighted in the survey as
important by government ocials.It is easier to agree i the acts are
clear and veriable.
Final thoughts
This survey illustrates that
increasing accountability and
transparency is a way orward,
whether in the context o getting
more out o stimulus money or
locking in long-term outcomes rom
inrastructure. The survey strongly
supports the increased involvement
o the private sector, which is likely
to help in delivering additional
inrastructure more eectively.
Increased private sector
involvement is not a total solution
and the public sector should also
bear responsibility or how it
leverages the private sector to best
add value.
© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
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nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
The Changing Face o Inrastructure: Public sector perspectives
The survey report
Corporate executives and private sector inrastructure providers point to a lack o
eectiveness within the public sector as a major hurdle to a more ecient inrastructure.
A survey o 328 C-level executives and board members conducted by the
Economist Intelligence Unit (EIU), on behal o KPMG International , ound that 68
percent rated government eectiveness as a concern in this regard – making this
their biggest worry, surpassing even economic conditions.1 A subsequent survey o
455 executives rom inrastructure providers ound an almost identical number
(69%) expressing great concern that public sector ineectiveness would inhibit
their industry’s ability to deliver what their countries need.2
In order to nd out i the private sector views are warranted, the EIU on behal o KPMG
International, conducted a survey in November and December 2009 o 392 public
sector ocials involved in inrastructure policy, procurement or development. Eighty-
one percent o these survey takers agree that the concerns are justied. Other key
ndings include:
Stimulus money is not eliminating the pressing need or inrastructure unding.
Headlines about the amount o stimulus money going into inrastructure grab
attention. China has set aside up to hal a trillion dollars, the United States some
U.S. $150 billion, Canada U.S. $14 billion, Germany U.S. $18 billion, the World Bank
U.S. $55 billion, – the list goes on.3
Even with this sort o expenditure, however, the survey shows that public sector
inrastructure ocials see a lack o unding as the leading inrastructure problem
worldwide. With regard to their own organizations, respondents say that a lack o
unding is the single largest impediment to eective delivery o inrastructure, cited
by hal o respondents.
Written by the EconomistIntelligence Unit
1 Bridging the Global Inrastructure Gap: Views rom the Executive Suite, January 2009
2 The Changing Face o Inrastructure: Frontline Views rom Private Sector Inrastructure Providers, August 2009
3 The Changing Face o Inrastructure: Frontline Views rom Private Sector Inrastructure Providers, p.7.
4 Bridging the Global Inrastructure Gap, p.16, The Changing Face o Inrastructure, p.10.
Levels of Concern Regarding the Availability of Financing
1–2
1 = very concerned and 5 = not at all concerned
3 4–5 Don’t know
0% 25% 50% 75% 100%
Public Sector
InfrastructureProviders
Senior Executives
1%69% 18% 12%
<1%60% 21% 19%
56% 26% 18%
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
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nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
The Changing Face o Inrastructure: Public sector perspectives
Looking ahead, 69% are concerned that a lack o nancing will inhibit their
organization’s ability to provide the necessary inrastructure to support long-term
economic growth within their jurisdiction. This indicates that the public sector sees
availability o nancing as an even more pressing issue than do senior executives as
a whole (56%) and private sector inrastructure providers in particular (60%).4 Nor do
public sector respondents see help on the horizon: 67% are concerned that the
economic situation will inhibit their ability to deliver the needed inrastructure.
Too little cash is a particular issue at the local level: 66% o respondents working
or cities or local governments, or example, cited a lack o money as a leadingimpediment to deliver inrastructure more eectively, compared to 36% o those
at the national level. Seventy-one percent o those working at the city level also
see insucient unding as the biggest impediment to higher investment in their
jurisdiction, compared to 40% o those at the national level.
In the downturn, national governments have spent more on inrastructure as an
economic policy response. But many cash-strapped lower levels o government
have cut back at the same time. A survey by Globescan or the United States
Conerence o Mayors in April and May 2009, or example, ound that 77% o cities
had lower inrastructure budgets in 2009, including more than one in ve who
expect the drop to exceed 15%.5 Available stimulus unds have not been lling the
gap quickly enough. In act, respondents cite a slow approval process (50%) as thegreatest impediment to spending such money eectively.
The situation in the United States illustrates how these actors are working
together. American respondents show a higher than average concern about
unding: 66%, or example, see inadequate unding as interering with their own
organization’s ability to deliver inrastructure more eectively; 69% see a lack o
unding as the greatest impediment to more public sector investment in the area;
and 78% are very concerned that the availability o nancing will impede their ability
to provide the inrastructure the country needs or long-term growth.
The politicization o inrastructure delivery and inconsistent political will are
creating investment uncertainties and hampering eective policy-making
and outcomes.
Among survey respondents, 58% are concerned that the political environment in
their jurisdiction will impede them rom delivering the inrastructure needed or the
long term.
Several actors play a large role in dening this environment. The rst is a lack o
consistent ocus by governments on inrastructure. Ater unding, respondents cite a
lack o political will as the second leading barrier to more eective provision by their
organizations (38%). In third, they put lack o a sense o urgency (27%). The last
5 The United States Conerence o Mayors, Metropolitan Inrastructure Sustainability Study: A research project prepared
by GlobeScan and sponsored by Siemens, 2009.
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The Changing Face o Inrastructure: Public sector perspectives
© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
problem is particularly pronounced at the national level, where the impact o poor
inrastructure may be less immediately apparent. For respondents rom that level ogovernment a lack o political will is the greatest hurdle to better delivery by
respondents’ organizations (40%).
Surveyed public sector ocials – none o whom are elected – also expressed
concern about the politicization o the whole eld o inrastructure. Here they are
not alone. Private sector inrastructure providers considered politicization the
greatest impediment to inrastructure investment (42%), and conversely that
de-politicizing the relevant policy processes was the most requently cited method
or improving government eectiveness in this area (45%).6
Respondents in the current survey generally agree. Only 3% believe that
inrastructure delivery prioritization does not need to be de-politicized. Instead, a
third say that politicization o such priorities is a leading impediment to greater
investment in inrastructure – the second most common answer – and 35% believe
that de-politicizing it is an important way to improve inrastructure development
where they work – again the second most requent reply.
Among survey respondents, the most common suggestion or how to de-politicize
inrastructure priorities is greater transparency (cited by 41%). Other leading solutions
involve nding ways better to insulate long term commitments rom short term
political cycles, including a greater use o public-private partnerships (37%);
establishing cost-benet methodologies or inrastructure projects (36%) and setting
and enorcing ormal guidelines or the creation o inrastructure priorities (34%).
6 The Changing Face o Inrastructure
Public Sector Suggestions for the Most Effective Ways
to De-politicize Project Prioritization
Increase transparency in infrastructureproject selection
Improve the public private partnershipprocurement process
Develop and adopt better cost-benefitmethodologies to quantify project outcomes
Establish and enforce guidelines forsetting infrastructure priorities
Increase stakeholder involvement
Improve identification of financial/social costs and benefits
Improve allocation of financial/social costs and benefits
Other
I disagree — the process doesnot need to be de-politicized
Don’t know
0% 20% 40% 60% 80% 100%
41%
37%
36%
34%
33%
32%
24%
3%
3%
3%
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
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The Changing Face o Inrastructure: Public sector perspectives
© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
Public sector ofcials acknowledge that government eectiveness is a serious issue.
Twenty-three percent o respondents agree that the concerns about government
eectiveness voiced by private sector inrastructure providers – that it is the most
widespread obstacle with respect to inrastructure delivery – are “very justied.”
A urther 58% call them “somewhat justied” and only 12% say that there is no
justication or them. Even more telling, 59% o public sector ocials have a high
level o concern over a lack o governmental eectiveness impeding their ability toprovide inrastructure – the most widespread worry ater unding and the economic
environment, and not all that ar rom the 69% in the earlier survey.
A major reason is money: 35% point to the size o budgets or projects as a leading
obstacle to the eectiveness o public sector’s management o inrastructure.
Equally important, however, is the lack o direction provided by decision takers:
35% blame a lack o consensus among policy makers and stakeholders over
priorities or the problem. Survey takers also indicate that poor management
practices have a marked impact on eectiveness. Thirty-one percent see a lack o
accountability as a leading obstacle, the same proportion that say there is too little
perormance management, and 28% cite insucient perormance-based pay.
Ineective control, accountability, and transparency measures are hurting
the ability o governments to deliver inrastructure.
However uncomortable a topic, public sector ocials also recognize that the
misuse o unds is a serious inrastructure issue. It is the area where they are least
likely to rank themselves as eective (only 39% do so). In act, 55% describe
themselves as at best mediocre, including almost one in eight admit to being not at
all eective here.
1–2
1 = very concerned and 5 = not at all concerned
3 4–5 Don’t know
0% 25% 50% 75% 100%
Public Sector
InfrastructureProviders
Senior Executives
1%59% 27% 13%
1%69% 18% 13%
68% 17% 15%
Levels of Concern Regarding Governmental Effectiveness
Inhibiting Infrastructure Development
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
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nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
The Changing Face o Inrastructure: Public sector perspectives 11
But cultural dierences stand in the way. Respondents say that the biggest
impediment (45%) the public sector to work eectively with the private sector in all
areas o inrastructure is the range o cultural dierences between the two.
These cultural issues lead to a lack o trust between the public and private sectors
– mentioned by 27% and the third most requently cited impediment – and
sometimes even conrontational relationships, cited by one in seven. When asked
specically about their own organizations, 27% say that their internal attitudes
would need to change in order to work more closely with the private sector
– the second most common issue ater shortage o cash.
This problem is again even more pronounced in developing countries, where 41% say
that a lack o trust is a leading barrier to greater cooperation with the private sector
where they operate, the most common answer. Also, 30% cite internal attitudes
at their own organizations, tied or rst with use o perormance-based measures.
These attitudes will inevitably slow progress in improving inrastructure and take
time to overcome. The Indian government’s attempt to upgrade its Industrial
Training Institutes through public-private partnerships, or example, has spent only
a th o its allocated budget, largely because o the cultural mismatch between the
two sectors is creating extensive delays. “You can’t expect a cultural transormation
over night,” explains S J Amalan, a regional director with the Directorate General o
Employment and Training.10
10 Shreya Biswas, “Work culture dierences take toll on PPPs in ITIs,” 11 August 2009, The Economic Times, http://
economictimes.indiatimes.com/News/News-By-Industry/Jobs/Work-culture-dierences-take-toll-on-PPPs-in-ITIs/
articleshow/4880017.cms
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nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
1 The Changing Face o Inrastructure: Public sector perspectives
Conclusion
Public sector ocials and private sector executives in the eld o inrastructure do
not see the world very dierently rom each other. They may dier slightly about the
relative approach towards creating the improved inrastructure environment which
countries around the world urgently need. But both groups recognize the mostserious impediments or doing so: insucient unding, a lack o engagement by
policy makers, excessive politicization, and shortcomings in government
eectiveness.
What this, and the earlier surveys, also make clear is that there is no quick x. A
food o stimulus money will not alleviate the problem. Increased transparency,
better trained inrastructure agencies, and greater public-private cooperation all hold
out the possibility o improved results, although it will be dicult to overcome long-
entrenched cultural dierences rapidly. Indeed, one o the most positive results o
this and earlier surveys has been a genuine appreciation o the benets o the two
sectors working together to create eective inrastructure delivery. Ultimately, it
will take the lasting, consistent commitment o resources rom the public andprivate sectors and improved ways o using those resources to provide the
inrastructure that will enable societies to develop to their ull potential.
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nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
The Changing Face o Inrastructure: Public sector perspectives 1
Appendix
Lack of funds
Politicization of infrastructure project priorities
Lack of sense of urgency
Corruption or misuse of funds earmarked for infrastructure
Lack of public policy stability
Lack of skills/knowledge/training of officials in this area
Lack of appropriate policies
Inadequate understanding of the severity of the issue
Lack of an effective procurement process
Lack of an appropriate legal/regulatory framework
Lack of legal/regulatory framework stability
Poor creditworthiness of public authorities
Other
Don’t know
None of the above — there are no impediments
0% 20% 40% 60% 80% 100%
56%
33%
21%
18%
18%
18%
18%
18%
17%
11%
9%
8%
3%
<1%
3%
Q1 Which o the ollowing are the greatest public sector impediments to more inrastructure investment in the
country where you are based? (Select up to three)
Q Thinking specifcally about the country within which you are located, what are the greatest barriers to working
eectively with the private sector in inrastructure (e.g., designing, building, fnancing and operating)? (Select up to three)
45%
31%
27%
25%
23%
20%
18%
14%
14%
7%
2%
5%
Differences in culture between publicand private sectors
Public sector obligation to be transparent
Lack of trust
Lack of a sufficiently deep, skilled,competitive private sector market
Inability to sustain commitments made(development stage or contract stage)
Inability to meet contractual commitments
(implementation stage)Unequal balance of power
Confrontational relationships
Absence of an equitable mechanismfor dispute resolution
Other
Don’t know
None of the above — there are no barriers
0% 20% 40% 60% 80% 100%
Due to rounding graph totals may not equal 100 percent
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
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© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
1 The Changing Face o Inrastructure: Public sector perspectives
Q In a previous survey, percent o private sector inrastructure providers cited governmental eectiveness as their
biggest concern to the eective delivery o required inrastructure. Thinking specifcally about the country within
which you are located, do you think that these concerns over governmental eectiveness are justifed?
23%
58%
12%
6%
0%
20%
40%
60%
80%
100%
Very justified Somewhat justified Not at all justified Don’t know
Q Thinking specifcally about the country within which you are located, what do you see as the greatest challenge
in spending the available stimulus money eectively? (Select up to three)
50%
32%
31%
31%
28%
23%
22%
13%
5%
1%
3%
1%
Slow approval processes
Excessive regulatory restrictions
Appropriate controls and monitoring
Accountability for expenditure
Transparency on expenditure
Need to allocate funds to‘shovel ready’ projects
Earmarking of funds forspecific projects
Readiness for influx of funds
Other
Don’t know
Not applicable — no stimulus money
Not applicable — no challenges
0% 20% 40% 60% 80% 100%
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
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© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
The Changing Face o Inrastructure: Public sector perspectives 1
Q Which o the ollowing actors would likely produce the greatest improvement in inrastructure development in the
jurisdiction or which you work? (Select up to three)
37%
35%
34%
28%
21%
21%
18%
17%
15%
15%
1%
1%
2%
4%
Better training of public sector officials
De-politicize the infrastructure public policy process
Greater use of public-private partnerships
More transparency in project selection
Establishing centres of excellence
More transparency in spending
Greater centralization ofinfrastructure procurement
Better compensation
Secondments between the public and private sectors
Increased ownership of infrastructureby infrastructure funds
Other
Don’t know
Not applicable — no need for improvement
Not applicable — jurisdiction toosmall for these solutions
0% 20% 40% 60% 80% 100%
Q Thinking specifcally about the jurisdiction or which you work, how concerned are you that the ollowing actors will
inhibit your organization’s ability to provide the relevant inrastructure that would support the long-term growth o
the economy in that jurisdiction? (1 = very concerned and = not at all concerned)
1%
1%
1%
1%
1%
1%
1%
1–2
Availability of financing
Economic conditions
Governmental
effectiveness
Political environment
Availability of relevant
skills/ people
Sustainability
considerations
Availability of resources/
raw materials
0% 20% 40% 60% 80% 100%
69% 18% 12%
67% 20% 12%
59% 27% 13%
58% 26% 15%
56% 24% 19%
44% 34% 21%
36% 26% 38%
3 4–5 Don’t know
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
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© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
The Changing Face o Inrastructure: Public sector perspectives 1
Q In your view, how eective are the ollowing processes in your organization regarding inrastructure?
(1 = very eective and = not at all eective)
1–2
Project definition
Assessment of needs
Funding approval
Contract managementduring implementation
Contract managementduring operations
Procurement
Project budgeting
Asset management duringoperations
Infrastructure policy definition
Sustaining and demonstratingcommitment
to project implementation
Misuse of funds
0% 20% 40% 60% 80% 100%
53% 29% 15% 3%
3%
2%
4%
4%
4%
6%
2%
2%
2%
2%
50% 30% 17%
50% 29%
49% 31%
48% 32%
47% 33%
47%
45%
45%
43%
39%
32%
37%
35%
36%
20%
16%
16%
18%
19%
15%
17%
18%
25% 31%
3 4–5 Don’t know
Q10 Thinking specifcally about your organization, do you think the private sector can help it to deliver inrastructure
more eectively?
65%
26%
9%
Don’t knowNoYes
0%
20%
40%
60%
80%
100%
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
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© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
1 The Changing Face o Inrastructure: Public sector perspectives
Q11 Thinking specifcally about your organization, what is preventing it rom delivering inrastructure more eectively?
Lack o: (Select up to three)
50%
38%
27%
27%
23%
22%
19%
18%
11%
5%
3%
Funds
Political will
Sense of urgency
Co-operation with the private sector
Clarity in internal processes
Authority
Experience and expertizeof my staff
Public support
Labour management issues
Other
Nothing is preventing thedelivery of infrastructure
0% 20% 40% 60% 80% 100%
Q1 Thinking specifcally about your organization, what would need to change in order or it to work more closely with
the private sector? (Select up to three)
Availability of funding
Internal attitudes
Increased use of performance-based measures
Procurement processes
Private sector attitudes
Public sector skills
Public opinion
New or revised laws
Private sector risk appetite
Market conditions
More resources tofacilitate transparency
Other
Not interested in workingwith the private sector
Don’t know
0% 20% 40% 60% 80% 100%
33%
27%
25%
24%
24%
24%
22%
19%
18%
16%
16%
3%
1%
1%
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
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© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
The Changing Face o Inrastructure: Public sector perspectives 1
Q In Which Region Are You Personally Based?
Demographics
32%
30%
30%
3%
3%
2%
North America
Western Europe
Asia-Pacific
Middle East and Africa
Latin America
Eastern Europe
0% 20% 40% 60% 80% 100%
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
Q In which country are you personally located?
Country Percentage Country Percentage Country Percentage
United States of America 30% South Africa 1% Finland <1%
United Kingdom 17% Hong Kong 1% Guatemala <1%
India 12% Ireland 1% Italy <1%
Austrailia 6% Isle of Man 1% Mexico <1%
Philippines 6% Kenya 1% Moldova <1%
Turkey 4% Netherlands 1% Mongolia <1%
France 3% Nigeria 1% Norway <1%
Canada 3% Switzerland 1% Paraguay <1%
Malaysia 3% Albania <1% Serbia <1%
Pakistan 2% Bahrain <1% Slovakia <1%
Spain 2% Barbados <1% Sweden <1%
Brazil 1% Belgium <1% Tunisia <1%
China 1% Cape Verde <1% Uganda <1%
Germany 1% Czech Republic <1% Ukraine <1%
Japan 1% Denmark <1% United Arab Emirates <1%
Portugal 1% Dominican Republic <1% Zambia <1%
Singapore 1% Falkland Islands <1%
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
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0 The Changing Face o Inrastructure: Public sector perspectives
© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
Q What is your organization’s average annual operating budget in U.S. dollars?
0%
20%
40%
60%
80%
100%
47%
$500 million or less
26%
$500 million to $1 billion
10%
$1 billion to $2 billion
17%
$2 billion or more
Q What is your organization’s average annual inrastructure budget in U.S. dollars?
0%
20%
40%
60%
80%
100%
55%
17%15%
5%9%
$250 million or less $250 million to
$500 million
$500 million to
$1 billion
$1 billion to
$2 billion
$2 billion or more
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
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The Changing Face o Inrastructure: Public sector perspectives 1
© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
Q At which level o government does your organization operate?
0%
20%
40%
60%
80%
100%
37%
28%
35%
City/local State/regional Federal/national
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
Q Which o the ollowing best describes your title?
0%
20%
40%
60%
80%
100%
26%23%
17%15%
5% 4%
11%
Manager or
equivalent
Senior manager
or equivalent
Project officer
equivalent
Director or equivalent Finance director
or equivalent
Head of agency/
ministry or equivalent
Other
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
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The Changing Face o Inrastructure: Public sector perspectives
© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
Q What is your main unctional role?
7%
1%
1%
2%
2%
3%
5%
5%
9%
9%
11%
15%
16%
16%Finance
General management
Operations/administration
Procurement
Strategy and planning
IT
Research and Development
Public affairs
Information and research
Legal
Human resources
Constituent service
Risk
Other
0% 20% 40% 60% 80% 100%
Yes
47%
53%
No
0%
20%
40%
60%
80%
100%
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
Q Are you or have you been directly involved in approving, applying or or using inrastructure stimulus unds?
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The Changing Face o Inrastructure: Public sector perspectives
© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
Q Which o the ollowing best describes your organization?
88%
6%
6%
0%
0%
0%
0%
Public sector
Multiregional and/or multilateral agency
Quango (quasi-autonomous non-governmentalorganization) or NDPB (non-departmental public body)
NGO (non-governmental organization)
Private sector
Other
Don’t know
0% 20% 40% 60% 80% 100%
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
Q Are you an elected ofcial?
Yes
0%
100%
No
0%
20%
40%
60%
80%
100%
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
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© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
The Changing Face o Inrastructure: Public sector perspectives
Q Are you involved in inrastructure policy, procurement or development?
Yes
0%
100%
No
0%
20%
40%
60%
80%
100%
Source: The Changing Face of Infrastructure: Public sector perspectives, KPMG International, 2010
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© 2010 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member rms o the KPMG network o independent rms are aliated with KPMG International.KPMG International provides no client services. No member rm has any authority to obligate or bind KPMG International or any other member rm vis-à-vis third parties,
nor does KPMG International have any such authority to obligate or bind any member rm. All rights reserved
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KPMG and the KPMG logo are registered trademarkso KPMG International, a Swiss cooperative.
Designed and produced by KPMG LLP (UK)’sDesign Services
The inormation contained herein is o a general nature and is not intended to address the circumstances o anyparticular individual or entity. Although we endeavor to provide accurate and timely inormation, there can be noguarantee that such inormation is accurate as o the date it is received or that it will continue to be accurate in theuture. No one should act on such inormation without appropriate proessional advice ater a thorough examinationo the particular situation. The views and opinions expressed herein are those o the individuals surveyed and donot necessarily represent the views and opinions o the Economist Intelligence Unit, KPMG International or KPMGmember rms. The inormation contained is o a general nature and is not intended to address the circumstances oany particular entity.
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