INPP defends private sector role in infrastructure

International Public Partnerships (INPP) has defended the role of private companies in public projects after the collapse of Carillion raised questions about such contracts.

Reporting its annual reults, INPP, which invests in public infrastructure projects globally, noted increased scepticism in the UK towards private sector involvement in government projects after the chaos and expense caused by Carillion’s bankruptcy. The Labour opposition has said it will take major infrastructure assets back under state control and nationalise private finance contracts.

Rupert Dorey, INPP’s chairman, said transferring risk to private companies had enabled projects to be completed on time and more efficiently for governments. But he acknowledged it was up to his company to show that it provided value for money for taxpayers.

Dorey said: "As a long-standing and leading originator, investor and operator of public infrastructure projects internationally, the company firmly believes that the close partnerships between public clients and private investment brings significant benefits to the public sector and ultimately the end-users and relevant parties. We also recognise that it is incumbent upon project owners and the broader investment industry to demonstrate the value we bring, not only to our investors but the communities in which our projects serve."

INPP’s net asset value rose to £2bn for the year to the end of December from £1.6bn a year earlier. Net asset value per share rose to 145p from 142.2p and the company proposed a 2.5% increase to the annual dividend to 6.82p a share.

Pre-tax profit fell to £106.4m from £175.3m as exceptional foreign exchange gains caused by the Brexit vote in 2016 were not repeated.

INPP was exposed to Carillion’s collapse because 3% of its 24 projects received management services from the company. INPP’s total cost of switching to new providers will be no more than £1.5m and no jobs will be lost, it said.