Comment We will make better sense of public-private partnerships (PPPs) if we have a better quality debate on the topic.

Many criticisms levelled at the notion of using private capital to fund, deliver and operate public infrastructure - like motorways, metro, elements of health service provision etcetera - are based on misunderstandings or misrepresentations of what is being proposed.

1. PPP is privatisation through the backdoor

It is not. But Eircom was. The shares were offered to the public, the share price collapsed, the company was subsequently bought out, shareholders lost money, a critical piece of national infrastructure came into the hands of Wall Street financiers and Ireland slipped down the infrastructure league table as capital investment took second place to servicing buyout debt.

Not a pretty sight - and exactly the "end game" scenario that a PPP would avoid. Here the public sector would contract with the private sector - rather than selling out to it - and the private sector partner would only be paid over the period of the contract for service delivered.

2. Private capital cost is prohibitively expensive

Not necessarily so. The blended cost of long-term capital for PPP projects will tend to be in the order of 7.5 per cent, compared to the Government funding cost of circa 5 per cent.

So although financing will indeed be more expensive in isolation, the all-in cost to Government will often be lower as incremental finance cost is outweighed by savings achieved over traditional procurement.

An increasing body of evidence (studies by Flyvberg and Mott MacDonald in the past 12 months covering hundreds of infrastructure projects worldwide) shows public sector procurement to cost typically 25-40 per cent more than originally approved due to the public sector's optimism bias on cost estimating and lesser success in managing risks and delivering to budget and timetable.

3. PPPs are deals where the public sector subvents private sector profit

The profit motive of the private sector in itself is no bad thing. Where infrastructure can be provided and service delivered by parties better positioned to manage project risks, whose own capital is on the line, in a cost-efficient manner, it is to be encouraged and not derided.

As long as transactions are procured in a competitive fashion and the ultimate deal represents value for money as measured by comparing the PPP deal on the table with the public traditional procurement alternative, overall value to the taxpayer will be achievable.

4. The private sector is not taking the risk

In isolated instances this may be the case but generalisation is dangerous.

For example, the Beaumont Hospital car park and West Link Toll Bridge contracts, which are often quoted, are not transactions that have been procured under the current regime of PPP.

In these cases, either specialist financial advisers were not involved or contracts were signed without going through a full tender process.

On the other hand, the National Road Authority's PPP programme has got off to an excellent start with the Kilcock-Kinnegad motorway. The value for money of this transaction to the public purse is estimated at tens of millions of euros

5. Benefits of PPP could be delivered without private capital being involved

This is the PPP "lite" approach. Take private capital out of the deal and it might still look like the real thing but it's not.

A DBO (design build operate contract) will see the private partner taking much less risk (their capital is not on the line) compared to a DBFO (design build finance and operate contract) where their "skin" is clearly in the game and that private partner receives no remuneration of their capital until it has delivered the project.

Also, DBOs will not deliver private capital, increasingly needed at a time when Exchequer finances are tightening.

6. PPP deals incorporate sweetheart tax breaks, so the taxpayer pays on the double

This is not the case. In PPP deals, the net outcome from an Exchequer perspective is neutral.

The private partner pays tax on its profits and obtains no unusual tax write-offs, just like in any other sector.

7. PPP involves selling the family silver

No, it involves buying more "silver", in terms of much-needed infrastructure, and financing deals in an imaginative yet well-proven way.

As the debate evolves, a more open approach needs to be encouraged. Private capital is not necessarily bad. Deals - if properly structured - can provide significant value for money for the public sector.

This is not old-style privatisation through the back door.

It is a new way to deliver infrastructure. It is being increasingly pursued by our main European trading partners in Britain, France, Italy, Spain, Portugal, etc.

And our Eastern European brethren soon to join the EU are already the focus of the major international community of contractors and financiers who see infrastructure delivery in those countries becoming highly active.

The Irish National Development Plan of 2000 - far from delivered - begins to look a bit jaded by comparison.

Ireland is at a crossroads and major infrastructure investment is required as a matter of great urgency across a wide range of sectors. Attempts to undermine the fledgling PPP model as part of the delivery solution will stifle the potential of this approach to deliver significant value to the public sector generally and result in a wasted opportunity of enormous scale.

Paul Finnerty is a partner in KPMG's corporate finance division in Dublin