Question Tag: Infrastructure Development

Musko Technical University (MTU) is a public University in Ghana. The University has a student population of about Twelve Thousand (12,000). It relies on Government subvention and Internally Generated Fund in running its operations and developing public infrastructure. As a result of the fiscal challenges the Government is experiencing, it has reduced its funding support to the University. This problem together with low Internally Generated Fund has resulted in the University expending greater proportion of its Internally Generated Fund on Goods and Services which reduces spending on infrastructure development. Currently, the University needs a good Library, Lecture Theatre and Hostel facility for the smooth running of its operations. The University is aware of the new Public Funding Initiative called Public Private Partnership (PPP). Fortunately, it has been approached by a South African investor who wishes to enter into a PPP contract with the University to build 8,400-unit capacity hostel facility in the University within two years. This arrangement is expected to reduce students’ internal accommodation deficit from 90% to 20%. Currently, the University’s challenge is how to maintain their control on the Hostel Facility after the construction under PPP.

Required: i) Explain THREE (3) PPP investment models suitable for addressing the needs of MTU. (6 marks)
ii) Discuss FOUR (4) benefits MTU may obtain from such initiatives. (4 marks)