THE AUTHORITY OF THE ADMINISTRATION IN DEVELOPING THE METHODS OF MANAGING PUBLIC UTILITIES

Abstract

In recent decades, the world has witnessed a major economic renaissance, manifested in the pursuit by governments of most countries of a better standard of living for their citizens, through the achievement of some economic development via implementing reforms that affects all economic fields. The most important of such reforms is the promotion of investments, national or foreign, which requires tremendous efforts to conduct major infrastructure development and modernize projects so as to build a strong impetus to countries in general – especially developing ones – and to place them in the ranks of developed countries. Also, there is a close link between economic growth and infrastructure; the lack of modernity of the latter hampers economic growth and vice versa, the more infrastructure is sophisticated and modern, the more it helps economic growth to evolve; because the establishment of modern and sophisticated infrastructure helps create an atmosphere conducive to achieving significant economic development and progress.

At the beginning of and middle of the twentieth century, it was the governments of states that sought and initiated infrastructure projects so that, at that time, they were not characterized by technological development or the complexity we are witnessing today. At the end of the twentieth century and the beginning of the twenty-first century, the rapid jump in technology, the fall of the Soviet Union and the failure of socialist methodologies, the world easily adopted a capitalist pattern based on the free movement of capital and the free trade that led to the emergence of the term international trade and the term globalization. The evolution of the state's functions from a limited role in protecting citizens and providing security to a greater role is related to the process of promoting economic, political and social development, which in turn has been reflected on public utilities, as along with administrative utilities, economic utilities emerged — both commercial and industrial. That development was accompanied by a similar evolution in the methods of utilities establishment and management.

 As a result of globalization and its effects, especially in economic terms, most of the world's nations have moved towards the application of a free economy and the abandonment of a socialist or command economy. This has led the state's thinking towards modern methods of managing public utilities so as to avoid the disadvantages of some traditional contractual systems, such as B.O.T contracts. Therefore, public-private partnership contracts have emerged in this evolving system, whereby risk allocation is based on the assumption by each partner of the risks that it is worth managing and overcoming with a degree of efficiency that exceeds the second party's management, which means resulting in the best exploitation of the resources of society, and a higher value for the invested funds. Moreover, partnership is a reform policy aimed at eliminating the imbalance of productive structures in public projects. It is an important source of funding. The partnership also aims to improve the quality of services provided to citizens and to lift the burden on the state's budget without affecting its ability to deliver services at competitive prices. The public-private partnership is a complex process that can serve all parties in the event of expert and appropriate management.