Public infrastructure maintenance: risks and the downside of performance based contracting

C. Gelderman, J. Semeijn, Sjerp de Vries

Research output: Contribution to conferencePaperAcademic

Abstract

A trend towards performance-based contracting (PBC) can be observed in public infrastructure maintenance. PBC is an approach of tying the contractor’s payment to specified performance. We investigated PBC for the maintenance of highways and roads in the Netherlands. Functional specifications tend to change constantly, and the client tends to jump in and take over responsibilities, which contradicts PBC principles. Incentives encourage undesirable behaviours by contractors. At the end of a project a contractor may not take responsibility for cost, quality or time problems. Clients should recognize and acknowledge the actual balance of power in the relationship with their (main) contractors.
Original languageEnglish
Number of pages16
Publication statusPublished - 2019
Event28th International IPSERA Conference : Art and Science of Procurement - Campus Bovisa, Milan, Italy
Duration: 14 Apr 201917 Apr 2019
Conference number: 28
http://www.ipsera2019.com/

Conference

Conference28th International IPSERA Conference
Abbreviated titleIPSERA
CountryItaly
CityMilan
Period14/04/1917/04/19
Internet address

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Contractors
Specifications
Costs

Keywords

  • performance based contracting, PBC induced risks, infrastructure maintenance

Cite this

Gelderman, C., Semeijn, J., & de Vries, S. (2019). Public infrastructure maintenance: risks and the downside of performance based contracting. Paper presented at 28th International IPSERA Conference , Milan, Italy.
Gelderman, C. ; Semeijn, J. ; de Vries, Sjerp. / Public infrastructure maintenance : risks and the downside of performance based contracting. Paper presented at 28th International IPSERA Conference , Milan, Italy.16 p.
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Gelderman, C, Semeijn, J & de Vries, S 2019, 'Public infrastructure maintenance: risks and the downside of performance based contracting' Paper presented at 28th International IPSERA Conference , Milan, Italy, 14/04/19 - 17/04/19, .

Public infrastructure maintenance : risks and the downside of performance based contracting. / Gelderman, C.; Semeijn, J.; de Vries, Sjerp.

2019. Paper presented at 28th International IPSERA Conference , Milan, Italy.

Research output: Contribution to conferencePaperAcademic

TY - CONF

T1 - Public infrastructure maintenance

T2 - risks and the downside of performance based contracting

AU - Gelderman, C.

AU - Semeijn, J.

AU - de Vries, Sjerp

PY - 2019

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N2 - A trend towards performance-based contracting (PBC) can be observed in public infrastructure maintenance. PBC is an approach of tying the contractor’s payment to specified performance. We investigated PBC for the maintenance of highways and roads in the Netherlands. Functional specifications tend to change constantly, and the client tends to jump in and take over responsibilities, which contradicts PBC principles. Incentives encourage undesirable behaviours by contractors. At the end of a project a contractor may not take responsibility for cost, quality or time problems. Clients should recognize and acknowledge the actual balance of power in the relationship with their (main) contractors.

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KW - performance based contracting, PBC induced risks, infrastructure maintenance

M3 - Paper

ER -

Gelderman C, Semeijn J, de Vries S. Public infrastructure maintenance: risks and the downside of performance based contracting. 2019. Paper presented at 28th International IPSERA Conference , Milan, Italy.