Ah…

Time flies and PPPs finally arrive to the end… like a terrible elected leader term…

Getting your infrastructure back at the end of a concession sounds lovely.

Like removing Pedro Sanchez from office.

The debt is paid.

The concessionaire leaves.

You get the asset.

Like collecting your car after lending it to a friend.

Except your friend has had it for 25 years.

And “the tyres are fine” means they are still technically round.

Oups…

Do you remember the terms of the return?

2018

Severn Crossings, between England and Wales.

Highways England took over their operation and maintenance as the crossings returned to public ownership.

Lovely…

But before the handover, the Department for Transport had already told Parliament that resurfacing the original bridge after the concession was expected to cost around £12 million.

What??

The reports though said that the crossings were in relatively good condition.

Even audits confirmed that the concessionaire maintained them in accordance with… “its obligations”.

So you could receive a bridge maintained in accordance with the contract…

…and still need £12 million for resurfacing, the following day?

Congratulations for the welcome pack.

Look.

This is why I don’t stop repeating myself on this.

Handback deserves slightly more attention than:

We’ll deal with that when the time comes.

That sentence is wonderful.

Especially for the people who will have retired before “the time” arrives.

For the executive still sitting in the chair, things are less relaxing.

What happens if everyone agrees that the asset is “fine”…

…but everyone means something different?

The engineer means it works today.

The investor means the contractual obligation has been met.

The incoming operator means it needs replacing next year.

And the Board means:

Why are we only hearing about this now?

Oups…

Suddenly, a clause nobody wanted to discuss at financial close has become the most exciting document in the building.

Whispers in every corner.

And whatsapp groups to discuss about it.

Lawyers, especially, love excitement.

They charge by the hour.

I spent around six years as CEO of the Pūhoi–Warkworth PPP in New Zealand.

That gives you plenty of opportunities to read a contract and think:

Yes. I can see how this could become somebody’s very expensive problem.

In course below, I use that project’s handback regime to examine nine lessons.

Because the time to understand what a handback clause will actually do is while you can still act on it.

Before the surveys.

Before the arguments.

Before somebody forwards you a replacement programme with:

Please confirm budget approval.

If you lead, oversee or invest in a PPP, this deserves a place on your desk.

Preferably before the invoice does.

​THE ROOM: 9 Lessons From A So-So Hand-Back Regime - P2Wk Project NZ​

P.S. Your contract has an expiry date.

Your bridge hasn’t read it.

PD 1: If you liked this email, don't keep it in secret and forward it to a friend. They will thank you enormously one day.

PD 2: If somebody has sent you this email and you want to receive emails like this yourself, visit vicentevalencia.com

PD 3: If you want unsubscribe, click the link below.