Financial analysis of scheduled desludging (Indonesia)

An analysis of faecal sludge management procurement was carried out with the PPP BOT scheme with an availability payment investment return system assessed by the Value for Money (VfM) principle. The VfM analysis used considers both quantitative and qualitative aspects. Quantitative aspect analysis uses the Public Sector Comparator (PSC) method to determine the difference between the value of investment costs and operational costs in conventional procurement (without PPP) with the procurement of PPP schemes. The results showed that the VfM value was positive, namely Rp. 17,744,964 and the VFM ratio was 4%. The qualitative aspect analysis assesses the readiness and feasibility of the faecal sludge management (FSM) service procurement project in South Tangerang City based on five criteria. The average value of the five criteria is 2,55 with a maximum score of 4. The value of the criteria for readiness of FSM institutions (local governments), criteria for interest and readiness of business entities (private parties) and criteria for suitability for PPP scheme projects are at low scores respectively 1,33; 2; and 2,75. While the criteria for the readiness of central government agencies and the criteria for community support, the feasibility criteria and project readiness are at a fairly high score of 3,4 and 3,28, respectively. The results of the study stated that the procurement project of FSM services with the PPP scheme in South Tangerang City was financially feasible but preparations needed to be made on the readiness criteria of the FSM agency (local government), the criteria for interest and readiness of business entities (private parties) and project suitability criteria with the PPP scheme.