Management mode of first-level government investment projects

With the development of social economy, the investment scale of engineering projects is increasing, and a single financing method and financing channel can no longer meet the needs of engineering construction. Therefore, modern engineering construction often needs to comprehensively use a variety of financing methods to raise the required construction funds from different channels. Project financing mode refers to the combination of different financing modes adopted by project sponsors or investors to meet the demand of project construction funds, as well as the economic and legal relationship between the financing parties involved.

1. Corporate financing

The main advantages of corporate financing model include: ① simple financing structure and easy operation; (2) The project company enjoys the complete right to use the funds; ③ In the process of project implementation, it is less supervised and controlled by banks and financial institutions.

The shortcomings of corporate financing mode mainly include: ① limited financing amount; ② Taking the company's assets as collateral and pursuing unlimited recourse are very risky.

2.BOT mode

The main advantages of BOT model include: ① reducing the impact of the project on the government budget; (2) It can overcome the disadvantages of time-consuming, high cost and poor operation service of government investment; ③ The cash flow of public infrastructure projects is stable and the investment risk is relatively small, which can bring stable and long-term investment income to investors; (4) As the franchise agreement of the project is signed by the investor and the government and is legally binding, the investor can obtain effective legal protection.

There are not too many defects in the financing structure and procedures, but in practice, due to the huge project scale and capital demand, and the complex relationship between the various stakeholders involved in the model itself, the advantages of BOT model can only be truly brought into play under a standardized and perfect system.

In practical application, BOT mode has undergone some changes due to the characteristics of the project itself, but the fundamental point of financing mode has not changed, such as:

BOOT (build-own-operate-transfer) is the transfer mode of building ownership and operation. This mode is an extension of BOT mode, and it is similar to BOT mode in running program. The difference between BoOT and BOT mode is that under BOOT mode, the project company not only owns the project management right, but also owns the project ownership for a certain period. Therefore, during the concession period, the project company can use the existing projects as its own assets as collateral for secondary financing. Generally speaking, the time for the project company to own and operate the project is much longer than that for the BOOT model.

Bt (build-transfer) is to establish a handover mode. In this mode, the project is financed by the project company, and immediately handed over to the government for operation after the project is completed, and then the government purchases the project by stages.

BLT (Build-Lease-Transfer) is to establish a lease-transfer model. With this model, the government only allows the project company to finance the construction. After the project is completed, it will be leased by the government and the project company will repay the loan with the rent paid by the government. After the lease term ends, the project assets will be handed over to the government.

3.tot mode

The main advantages of TOT model include: ① based on the infrastructure projects that have been put into production, the risks of private enterprises during the construction period are reduced, and the barriers for private enterprises to enter the infrastructure industry are reduced; ② In the process of transfer, the state-owned and private modes of infrastructure industry are formed through the transfer of management rights. The operating efficiency of the infrastructure industry is directly linked to the interests of operators, thus effectively motivating enterprise operators and employees, and at the same time increasing fiscal revenue for local, regional and central governments; (3) After the concession period of the project ends, the project will be returned to the government free of charge, so as to finally maintain the nature of state-owned assets, ensure the government's right to supervise the infrastructure industry and prevent the loss of state-owned assets; ④ Introducing the efficiency mechanism of private capital into infrastructure industry can greatly improve the efficiency of infrastructure management and change the current shortage of funds in infrastructure industry operation.

The limitation of TOT mode lies in the determination of transfer price. At present, the main controversy about this model also focuses on this issue. In practice, the transfer price is too low, which easily leads to the loss of state-owned assets, while the price is too high, which makes it difficult to attract funds.

4.ABS mode

The main advantages of ABS financing mode include: ① the project can enter the international high-grade investment-grade securities market through credit guarantee and credit upgrade plan, with few trading links and low financing cost; (2) Because bonds are publicly issued in the securities market and have strong liquidity, they can attract individual investors, thus dispersing the investment risk of the project and facilitating the conversion of short-term funds into long-term funds; ③ Low financing cost.

Limitations of ABS financing mode: ①ABS financing is mainly through private channels rather than government channels, and it is a financing mode that operates according to the laws of market economy. Therefore, the premise of adopting ABS financing mode is to have a mature and perfect capital market; (Generally, the investment in ABS financing projects is large, so it is difficult to guarantee or upgrade its credit, and it is quite difficult to raise funds for project construction completely through issuing securities.

5.PPP mode

PPP (public-private-partnerships) mode, that is, the cooperation mode between public and private enterprises, is also called "public-private partnership" financing mode. This model is a cooperative relationship among government, for-profit enterprises and non-profit enterprises based on a certain project. When all partners participate in the project, the government does not transfer all the responsibilities of the project to private enterprises, but all partners share the responsibilities and financing risks. Under this model, the investment goal of private enterprises is to seek projects that can repay loans and return on investment, and the social and economic goal of the government is to bring the greatest economic benefits to society through investment.

The advantages of PPP financing mode include: ① the lender takes the limited commitment given by the government as the security guarantee of the loan; (2) In this mode, government departments have certain decision-making power and control power over the project construction; ③ The distribution of risks and responsibilities of the project is more reasonable, and the project financing is easier to succeed.

6.PFI mode

The main advantages of PFI model include: ① attracting various sources of private capital with potential huge market and profits, investing in infrastructure construction, making up for the lack of funds and reducing the financial burden of the government; (2) PFI will not make the government completely lose control of the project ownership or management right during the concession period like BOT. The government will not transfer the ownership of the project during the concession period, and can check the progress of PFI project at any time.

Limitations of PFI model: it is difficult for the government to reasonably determine the cooperative company, and the government has to bear certain responsibilities in cooperation, which increases the risk burden of the government. At the same time, the organizational form in this model is more complicated, which increases the difficulty of management coordination and requires higher management level of participants. With the transformation of China's economy from planned economy to socialist market economy, influenced by the reform of macro-political and economic system, China's government investment project management organization model has also experienced a historical development process from planned to market.

1. Self-operated mode of the construction unit

During the period of 1949 ~ 1957, China was faced with the task of restoring and developing the national economy and needed a lot of capital construction investment. However, the strength of design and construction at that time was very weak and scattered, so the state could only combine production units with construction units, and the construction units organized the project construction themselves.

2. A, B and C tripartite system

3. Engineering Headquarters

After 1958, the management system in the form of engineering headquarters appeared in China. In the construction of many large and medium-sized projects, the way of engineering headquarters is adopted, led by the competent government departments, and the construction units, design units and construction units are organized to set up headquarters, preparation offices and specific project offices, so that the functions of managing construction projects are separated from those of managing production projects, and the engineering headquarters is responsible for design, procurement and construction management in the construction process. After the project is completed, it will be handed over to the production management organization for operation, and the engineering headquarters will complete its mission.

This management mode, because the headquarters is the agency of the competent government department, has great authority in exercising the functions, decision-making and direct command of the construction unit, and can rely on administrative means to coordinate various relations and allocate the design units, construction teams, materials and equipment needed for the project construction. Under the specific economic and political conditions, it has played an active role in building a number of basic projects and "third-line" construction related to the national economy and people's livelihood under the headquarters model. However, the main defect of this model is that it does not solve the problem of disjointed project construction links. In addition, the leading group and the headquarters are temporarily established, lacking the experience and means of organizational construction, the management level and efficiency are low, and the project duration and investment have not been effectively controlled, resulting in a situation of "only one lesson, no two lessons".

4. Infrastructure office types

This model came into being in 1950s, and it is still a common model. Its main feature is self-construction, and all administrative departments (such as education, culture, health and sports) and some units with many engineering projects have capital construction offices, which are responsible for the implementation of specific projects, and the administrative departments mainly carry out daily administration. The biggest problem of this model is "moral hazard". Due to the free nature of government investment, project management subjects generally try their best to win investment, constantly increase project budget, make maximum use of financial funds, and seek benefits for their own units, which leads to the failure to effectively control government investment.

5. Types of professional organizations

This mode is a new type of government investment project management mode explored by various provinces, cities and regions in China, which is more common in the field of municipal engineering construction. According to the nature of management institutions, there are government agencies, institutions and enterprises.

Government agencies, that is, government departments, are directly responsible for the construction management of engineering projects. For example, Shaanxi Province established the Shaanxi Provincial Unified Construction Management Office (hereinafter referred to as "Unified Construction Office"). The task of the Unified Construction Office is to be responsible for the unified construction and management of government investment projects in the whole province, manage and build construction projects originally belonging to various departments and bureaus (except water conservancy and transportation industries), and cancel the infrastructure office located in the above-mentioned departments and bureaus.

Institutional, that is, the government set up a special agency to manage construction projects. For example, Shanghai Pudong New Area Construction Bureau has set up a special engineering construction management company, which is a non-profit organization and is responsible for the implementation and management of municipal infrastructure projects invested by the government.

Enterprise type, that is, after the project scheme is determined, the relevant government departments entrust an enterprise as the owner. For example, Chongqing Urban Construction and Development Co., Ltd., similar to foreign project management companies, is responsible for the construction of government-commissioned projects, that is, the government entrusts government-invested projects to companies, and the companies are responsible for the whole process of construction and implementation.

6. Project legal person responsibility system

The Interim Provisions on Implementing the Legal Person Responsibility System for Construction Projects issued by the former State Planning Commission 1996 stipulates that large and medium-sized capital construction projects operated by state-owned units must establish project legal persons in the construction stage. The project legal person may establish limited liability companies according to the Company Law, including wholly state-owned companies and joint stock limited companies. For general profitable projects, the profit-seeking nature of the owners determines that such projects are for profit, and the market can form its investment control and risk restraint mechanism. As the project owners bear the risk of obtaining the expected investment income, they will be responsible for the project investment control. Therefore, for a few profitable government investment projects, the project legal person responsibility system should be implemented, and the project legal person, as the owner, takes full responsibility for the expected investment income of the project.

7. Agent construction system

In recent years, China has begun to try and implement the agent construction system. The State Council's Decision on the Reform of Investment System promulgated in July 2004 clearly stated that government-invested projects should be implemented on an agent basis, that is, professional project management companies should be selected through bidding to take charge of the construction and implementation of the projects, and the investment, quality and construction period of the projects should be strictly controlled and handed over to users after completion.

During the project construction period, the government chooses a project management company with corresponding legal person qualification to be responsible for the whole process of project construction organization and management, and the government binds the agent construction unit through contract rather than administrative power. The agent construction unit has legal person status and legal person rights in the project construction stage, including the right to control the construction funds under the supervision of the owner, and bear corresponding responsibilities, including the responsibility of maintaining the investment value.

The implementation of the agent construction system makes each link of the four-in-one management mode of "investment, construction, management and use" in the current government investment system separate and restrict each other, which can effectively curb the corruption in government investment projects, and has exemplary significance for controlling the phenomenon of "three excesses" (over-investment, over-scale and over-standard) in engineering projects that are common in China. The implementation mode of engineering construction refers to the trading activities between different subjects in the construction market and the economic and legal relations formed by them. After long-term development, the implementation mode of project construction and the corresponding contract form are constantly innovated and improved, forming a variety of widely recognized forms.

1. Traditional mode

Traditional mode is the most common project management mode at present, also known as design-bidding-construction method or sequential construction method. This model is adopted in the loan projects of the World Bank and the Asian Development Bank, as well as the projects adopting FIDIC civil engineering contract conditions.

In this mode, the project owner should first entrust an architect or consulting engineer to carry out the preliminary work of the project, such as project analysis and feasibility study, and then carry out project evaluation and project design. In the design stage, the construction bidding documents are compiled, and then the construction bidding is carried out. The owner and the contractor sign the construction contract, which can take the form of parallel contracting or general contracting. The contractor shall directly sign contracts with subcontractors and suppliers and organize the implementation of engineering subcontracting and materials and equipment supply. Some suppliers can also be designated by the owner, but they must sign a contract with the contractor. In the process of project implementation, the owner contacts the consultants and contractors through their representatives to be responsible for project management, or authorizes architects, consulting engineers and supervision engineers to carry out project management.

The traditional mode has the advantages of mature management means, high standardization of contract text and strong standardization of program operation. All parties involved in project management are very familiar with the contract conditions and application procedures. Owners can also freely choose consulting designers and supervisors in stages. The risk of project management is relatively small. Its disadvantages are long project cycle, high management cost of the owner and large initial investment of the project; Inconsistency among consultants, designers and constructors may lead to more design changes and engineering claims.

2. Project management mode

Project management refers to the enterprise engaged in project management, entrusted by the owner, to carry out the whole process or several stages of management and service on behalf of the owner in accordance with the contract. Its main forms are as follows:

(1)PMC mode

PMC mode (project management contractor) means that the project owner hires a company (usually an engineering company or consulting company with considerable strength) to provide project consulting services for the owner or manage the whole project process on behalf of the owner. According to the different nature of work, PMC company is called "project management consulting company" or "project management contractor" in the project, referred to as PMC for short. As the representative of the owner or the extension of the owner, PMC helps the owner to effectively control the project quality, schedule and cost in the whole implementation process of project pre-planning, feasibility study, project definition, planning, project budget, financing scheme, subcontracting scheme, design, procurement, construction and debugging, so as to ensure the smooth implementation of the project and realize the optimization of technical and economic indicators throughout the project life. On the one hand, the management contractor signs a contract with the owner, on the other hand, it signs a contract with the construction contractor. In general, the management contractor does not participate in the construction of specific projects, but subcontracts the construction tasks to the construction contractors.

(2) Preventive maintenance mode

PM (Project Management), the service mode of project management, is an internationally accepted project management mode, which was gradually applied in the United States, Federal Republic of Germany and France in the late 1950s and early 1960s. According to the contract, the owner entrusts a professional organization to manage the whole process on behalf of the owner. Nowadays, many projects are becoming more and more complex, especially when an owner has several projects in different stages at the same time, and the functions that need to be performed are beyond the scope of design, liaison and inspection undertaken by architects before, so a project management company needs to send a project manager (and his assistant) with rich project management experience to provide management consulting and services for a project.

The project management services provided by PM mode usually include consulting in the early stage of the project and management services during the implementation period. Although similar to PMC mode, the project management company does not sign a contract with the contractor, and the two are only management coordination. This model may serve a wider range, so it can also be called the integrated model of project management. In essence, this mode belongs to management mode, not risk contracting mode.

(3)CM mode

CM mode (construction management method) is also called phased construction method or fast track method. It is a joint team composed of the owner and CM managers and architects entrusted by the owner, responsible for organizing and managing the planning, design and construction of the project. After the main design scheme is determined, the sub-projects are designed and the completed sub-projects are invited for bidding. The owner directly signs a contract with the contractor for each subdivisional work.

The biggest advantage of CM mode is that it can shorten the cycle from planning, design to completion, save investment and reduce risks. Complete a plate, operate a plate, and you can get benefits early. Such as real estate development, expressway construction and so on. Its disadvantage is that sub-item bidding may lead to higher contracting costs.

There are two common forms of CM mode: one is AgencyCM, and the other is AtRiskCM. When the agency mode is adopted, CM Company is the consultation and agent of the owner, and the service contract between the owner and CM Company adopts the method of fixed fee plus management fee, and the owner signs the construction contract with the contractor at each construction stage. When adopting the risk-based model, CM Company also acts as the general contractor. General owners require CM Company to put forward a guaranteed maximum price (GMP) to ensure owners' investment control. If the final settlement exceeds CMP, CM Company will compensate. If it is lower than GMP, the saved investment will be divided by the owner and the contractor according to the agreed proportion, and the general owner will get more. GMP includes the total budgeted cost of the project (including the direct cost, indirect cost and unforeseen cost of the project) and the remuneration of CM Company (including management fees, risk fees, profits and taxes, etc.). ).

3. Project general contracting mode

General project contracting refers to the whole process or several stages of contracting for the survey, design, procurement, construction and trial operation (completion acceptance) of the project entrusted by the owner. Its main forms are as follows:

(1) "turnkey" mode

"Turn-key" mode refers to the whole process contracting mode signed by the contractor and the owner, including project financing, design, construction, equipment procurement, installation and commissioning until completion and handover. What the owner gets is a project with complete facilities and complete operation.

(2) General contracting mode

EPC mode (engineering, procedure, construction) means that the general contractor undertakes the design, procurement, construction and other work of the construction project according to the contract, is fully responsible for the safety, quality, progress and cost of the project, and can subcontract some work to subcontractors as required. The subcontractor is responsible to the general contractor. The owner's representative can be a design company, consulting company, project management company or other engineering companies that do not contract this project.

(3)DB mode

DB mode (design-build) is a simple project management mode. In this mode, the owner first hires a professional consulting company to draw up the basic requirements and scheme of the project construction, and authorizes an expert with high professional level and management ability as the owner's representative. Then, the project design and construction general contracting tender will be conducted, and a general contract will be signed with the general contractor. The general contractor is responsible for the cost of the whole project. The general contractor can complete the design and construction of the project by himself, or entrust a consulting design company to design and select subcontractors through bidding. In this mode, the design and construction overlap closely, saving time and money to some extent. The owner also reduced the investment risk caused by rising prices by signing a lump sum contract.

(4) Other general contracting modes

According to the different scale, type and owner's requirements of the project, the general contracting of the project includes design-procurement (EP), procurement-construction (PC) and other forms.