Contracting for road maintenance in the Netherlands: The downside of Performance-Based Contracting

Cees J. Gelderman; Janjaap Semeijn; Sjerp de Vries

doi:10.3390/infrastructures4030041

Contracting for road maintenance in the Netherlands: The downside of Performance-Based Contracting

Cees J. Gelderman^*, Janjaap Semeijn, Sjerp de Vries

^*Corresponding author for this work

Marketing & Supply Chain Management

Research output: Contribution to journal › Article › Academic › peer-review

Abstract

A trend towards performance-based contracting (PBC) can be observed in public infrastructure maintenance. PBC is an approach of tying the contractor's payment to specified performance. We investigated PBC for the maintenance of highways and roads in the Netherlands, identifying issues ultimately resulting in poor contractor performance. The PBC-induced risks for clients relate to the problematic translation and measurement of specifications, the ineffectiveness of incentives, the avoidance of contractors taking full responsibility, and contract management issues. Clients should recognize the actual balance of power in the relationship with their (main) contractors, and take appropriate measures.

Original language	English
Article number	41
Number of pages	16
Journal	Infrastructures
Volume	4
Issue number	3
DOIs	https://doi.org/10.3390/infrastructures4030041
Publication status	Published - 10 Jul 2019

Keywords

performance-based contracting
PBC induced risks
road maintenance

Access to Document

10.3390/infrastructures4030041Licence: CC BY

Cite this

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title = "Contracting for road maintenance in the Netherlands: The downside of Performance-Based Contracting",

abstract = "A trend towards performance-based contracting (PBC) can be observed in public infrastructure maintenance. PBC is an approach of tying the contractor's payment to specified performance. We investigated PBC for the maintenance of highways and roads in the Netherlands, identifying issues ultimately resulting in poor contractor performance. The PBC-induced risks for clients relate to the problematic translation and measurement of specifications, the ineffectiveness of incentives, the avoidance of contractors taking full responsibility, and contract management issues. Clients should recognize the actual balance of power in the relationship with their (main) contractors, and take appropriate measures.",

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