Service Provision Projects (PPS) as an Alternative to Direct Public Debt – Tech Viral Tips

Service provision projects are long-term contracts made between a public entity and the private sector, through which private investors, with their own resources, agree to develop certain infrastructure work or provide services, and as such Its infrastructure needs have grown to meet government capacity, and it has an obligation to provide public services to the population.

PPS is, in fact, a form of public-private partnership (PPP), as a subset of this broader universe of collaborative schemes, which can include concessions, leases and financed projects, intended to take advantage of synergies and This is to ensure that investments are paid for primarily by the private sector, given the scarce resources available to various levels of government and their government entities.

When these PPS contracts are used as a vehicle for securing physical infrastructure at the end of a commitment to the government, such as financial lease contracts, the Financial Discipline Law of federal entities and municipalities, “obligation” Considers a registry. Where these payment commitments should be included, and the “amortization” or capital payment component included in the periodic payments made to the PPS, should be recorded.

In this way, government entities are not required to make direct loan contracts for the total amount to be invested, and this obviously generates a range of financial benefits, which is why they use physical investments not just in infrastructure. Represent an exceptional vehicle for making payments, but also authentic projects for the provision of public services.

However, in NL, the use of these financial vehicles of APP in general and PPS in particular has been given very little, as only 2 projects have been financed under these schemes, one being the Administrative Tower, and the other, the State. The creation of the investigative agency, both in charge of the state government, projects with an original value of less than $1,500 million pesos.

Other states, such as BC and the state of Mexico, for example, highlight these financial plans for a variety of financing projects, ranging from more than $20 billion in pesos, to hospitals, (construction and equipment) to highways. Photovoltaic power plant with an investment of $10,848 million pesos, and a seawater desalination plant with an investment of $9,073 million pesos.

If we look at the indebtedness registered by NL organizations and companies, we find that none of them have made use of these financing mechanisms, and have opted for a contract of direct loans, and the $29 billion pesos that they provide for direct loans. Nationally, they represent 75% of all debt to state agencies and companies.

In other words, in n, l, both the state government as well as its agencies and companies have chosen to resort to direct indebtedness to finance their works such as metro, hospitals, road and hydraulic infrastructure, which remain directly in the balance sheet. affects the amount. Public debt, which is the second largest in the country, while other states have resorted to PPP schemes to avoid these impacts at the level of net direct debt.

So, the suggestion is to make the most of these partnership schemes with individuals, and take advantage of partial and deferred registration subject to financial obligations.