Private players hesitant on public projects after new RTI ruling

Times of India: Chennai: Monday, April 22, 2013.

The Centre's recent decision to disclose information related to public-private partnerships (PPP) to RTI applicants may throw a spanner in the works of several infrastructure projects. While RTI activists have hailed the move saying it would usher in greater accountability, private players are cold to the idea as they apprehend the use of RTI to create opposition to projects.

Industrial sources said most private firms are not ready to come under the RTI Act as they fear it may result in greater interference or more delays due to RTI-related controversies. However, the central chief information commissioner said it would usher in more transparency in projects.

Arvind Mahajan, partner, advisory services of KPMG, said: "If it ensures transparency then it is great but if it becomes a mechanism to delay projects or ask for competitive information then it might hinder participation and become a headache, more so for unlisted companies."

He said that if companies "see a lot of red tape" and delays arising due to it, they might be hesitant. "They will start weighing the risks against the size of the project. If the project size is small but has contentious issues around it, it might become hard for government to find partners," said Mahajan.

Chief Information Commissioner (CIC) Satyananda Mishra said the government's decision to disclose information related to PPP projects will bring transparency. "Bringing private firms under the ambit of the RTI Act is a step on the right direction," he said. Mishra had earlier written to the Planning Commission to make it mandatory for private firms involved in PPPs to reveal information under the RTI Act.

Many infrastructure projects such as flyovers, public transport, highways, ports, water distribution networks or health are increasingly built under the PPP model. But recent controversies over cost inflation or undervaluation of public assets have cast a shadow on the use of PPPs.

"PPPs are often allotted to those close to system. Project costs are inflated, which in turn, result in high toll collection from public. Whether there are adequate services after PPP gets operational needs to be vouched in public interest," said RTI activist M Thuyamurthy.

"Most new infrastructure projects are in the PPP domain," said Mahajan. He said in the twelfth five year plan, $1 trillion has been earmarked for infrastructure projects out of which $500 million will come to the private sector. "A majority of this $500 million is going to be executed in the PPP mode," he added.

For government to come up with huge infrastructure projects without technical or financial assistance of private firms is difficult. PPP projects are seen as vital to bridge financial deficits. "But many private firms do not want to come under the RTI Act, as government departments themselves are now struggling to reply to hundreds of queries on various projects," said a senior government official.