Research On Price Mechanism Of PPP Project

In the year 2014,in order to settle the lack of quantity,serious homogenization and simplification,lack of effective investment,and uneven regional development in public service,Ministry of Finance and the concerning departments,under Decision of the Central Committee of the Communist Party of China on Some Major Issues Concerning Comprehensively Deepening the Reform in the Third Plenary Session of the 18 th Central Committee of the CPC,determine to increase the quantity and quality of public services.Specifically,it is decided to promote PPP,which used to be regarded as a market financing tool,to a comprehensive public service for market and social reform,thus bringing out the best in the society and market.PPP reform is predominantly driven by the structural reform of supple,and supplemented by demand.The hinge of PPP reform is shouldered by the price mechanism.At present,the overall price level of the public service in China is low,resulting in many unreasonable phenomena.Besides,pricing means are not diversified,which cause that the traditional cost-plus model faces some problems based on information asymmetry under PPP model,such as dark box of social capital's cost and lack of incentive compatible mechanism.What's more,there are two extreme cases in the price competition of PPP project.One is the abuse of procurement and the blind expansion of the applicable scope of competitive negotiation and single source procurement,which leads to insufficient competition and high prices.The other is the malicious competition and the succeeding in bidding at low price,which means the price is too low to meet the social capital's demand for gains,resulting in the whole life cycle of service quality decline.The price mechanism enjoys a great significance to bring the lever of price into play,thus the scientific,effective sustainable financial resources,the guidance to the investment of social capital,a stable outcome of social capital,the faster execution of projects,and the protection of public interest.On grasping the new tendency and PPP reform of China,through the study on the traditional price regulation,the PPP pricing experience of some more sophisticated markets,and the typical pricing practice of PPP home and abroad,based upon the investigations and real conditions of China,from the system of price mechanism theory point of view,this essay points out the issues on the design of pre-pricing,such as imperfect legal system,the process of price management,such as a lack of scientific reasonable pricing mechanism,price adjustment and true cost information,the post-assessment of pricing,such as the slack of regulation,and unsound post-assessment of the performance of PPP pricing in China.In this regard,this essay proposes that the design of pre-pricing should mainly consider the price principles,to lay a good foundation,that the process of price management mainly consider the price means,to solve the problem "how",and that the post-assessment of pricing mainly consider the price performance,to solve the problem "effectiveness".Specific suggestions are as follows: improve the PPP project price top design;clear the basic principles of PPP project price mechanism;establish and improve the pricing mechanism of PPP project;speed up the improvement of PPP project price dynamic adjustment mechanism;enhance the pricing regulation on PPP projects;and set up the post-assessment on the pricing of PPP.