Public Private Partnership (PPP) and Private Financing Initiative (PFI) are both financial insrtuments for the delivery of private sector assets into the tax-funded public services.

PPPs are more sophisticated by means of long term and complicated relations between stakeholders, i.e. the Public and the Private Sector. PPPs usually generate profit from the investment. In contrast, PFIs practically represent a tool at the Public's discretion for borrowing money from private sources.

The Private Finance Initiative (PFI) plays an important role in the delivery of Government's plans for public services. The investment program is delivering extensive new and modernized infrastructure to public services. Evidence to date suggests that the PFI is most appropriate where there are major and complex capital projects with significant ongoing maintenance requirements. For these projects, the Service Provider can offerproject Management skills, innovative design and risk management expertise that can bring sustainable benefits.

PFI relationships are very different from privatization, in which the market and price mechanism defines the service provider.