The selection of PPP scheme using VfM analysis for Sekupang – Batam Centre Corridor

Abstract

The study on public mass transportation in Batam City was started in 2010 by BP Batam. The study is still in a long polemic due to problems arise in technical and non-technical aspects, such as limited funding capacity of local government. Therefore, the government wants to involve private sectors in the development plan. This study aims to analyse the selection of Public Private Partnership (PPP) scheme using value for money (VfM) as one of the solutions for public transportation funding problems. The methodology used in this study is the benchmarking method from several scenarios with an emphasis on the point of view of economic and financial feasibility studies. Several scenarios of PPP Scheme with different concession period and investment proportion were analyzed based on its VfM policy. The result of the VfM analysis shows that the VfM value for actual condition is 1,139,946 (IDR Mill). The most significant factors that affect the value of VfM is the changes in the concession period. The concession period of 20 years gives the maximum VfM value. In all scenarios, there is no negative VfM value which indicates that this public project is better if it is carried out with the PPP scheme.