Towards Explaining the Cause of PPP as a Dangerous Diversion of Meager Resources in Lesotho

International Journal of Research and Innovation in Social Science (IJRISS) | Volume IV, Issue VI, June 2020 | ISSN 2454–6186

Towards Explaining the Cause of PPP as a Dangerous Diversion of Meager Resources in Lesotho

Thuso Donald Mosabala
Pan African University in Cameroon, Yaoundé

Abstract: The article examines the greatly marketed Public-Private Partnerships (PPPs) as a means towards realizing solutions on the protracted health challenges in the Kingdom of Lesotho. It is premised on the idea that while there may be differing views on the appropriateness and inappropriateness of the PPPs in Lesotho, what remains an issue of concern is the decision to invest in an arrangement that the country has little or no experience in, especially on the health sector. To further explain this particular problem, the paper employs three theoretical approaches to analyze Lesotho’s decision to invest in the PPP. This article is motivated by the question, what led to the Lesotho PPP in the form of Queen ‘Mamohato Memorial Hospital being considered a dangerous diversion of the Ministry of Health meagre resources? As a point of departure, the conceptualization of PPP is explored. The article will proceed to provide a background on the PPP in Lesotho, theoretical approaches as well as touching on the literature and general implications of the model in Lesotho.

Keywords: Public-Private Partnership, Infrastructure, Health

I. INTRODUCTION

The Public-Private Partnerships (PPPs) are increasingly being promoted as a solution to the shortfall in financing needed to achieve the Sustainable Development Goals (SDGs). From economic infrastructure, such as railways, roads, airports and ports, to key services such as health, education, water and electricity, the much touted model of PPP is being employed to deliver such infrastructural developments in various countries in both the global north and south (Gondard, 25 September 2018). However, this model has not come without serious negative financial implications for countries, and in Kingdom of Lesotho’s health sector and the country at large.

It is important to note this early that the ability to secure private investment and or new sources to finance the infrastructure through the Special Purpose Vehicle (SPV) (a subsidiary created by a parent company to isolate financial risk) is one motivation for the Lesotho government to have taken the PPP among many other motivations. By implication, the use of SPV also means that PPP in Lesotho was financed off-balance sheet. But the problem is not so much about the manner in which the project was financed, but the actual decision of investing in the PPP, arguably as shall be demonstrated, without a clear forecasting and understanding of the model in its totality.

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