Achieving more together: public-private partnerships as a model for the future
PPPs enable local authorities to provide modern, economically stable and socially responsible public services – even across national borders. Saubermacher is a pioneer in this field and currently has 19 successful partnerships in Austria and neighbouring countries. Municipalities benefit from predictable costs, new sources of income through third-party business and long-term budget relief.
In this discussion, four experts provide insights into opportunities, prerequisites and practical experiences.
- Günther Albel, Mayor of Villach
- Martin Oder, lawyer and partner at Haslinger & Nägele
- Peter Pilz, tax advisor at BDO Austria
- Andreas Opelt, Chief Operating Officer (COO) at Saubermacher Dienstleistungs AG
What is the financial situation in the municipalities – and what does this mean for public services?
Albel: Municipalities are currently under enormous pressure: financial equalisation is no longer balanced, and investment is hardly possible. We are the largest public investors – if we can no longer invest, a lot will come to a standstill. And this at a time when, in some places, ASZs are outdated and vehicle fleets need to be replaced on an ongoing basis. Municipalities need models that give them room to breathe.
What do the figures say about the budget situation?
Pilz: Local authorities are the only regional authorities that have not increased their deficits from 2023 to 2024 – they are doing their bit. Nevertheless, the scope for action is shrinking: in 2019, 51% of revenue actually went to local authorities, but by 2024 this figure will be only 37%. Levies are eating everything up. Operating profits have halved since 2019. At the same time, personnel costs are rising. Revenues are also stagnating – for example, due to staff cuts at companies, which are affecting municipal taxes.
How can a PPP help here in concrete terms?
Or: An PPP model creates a new company to which the municipality contributes its expertise, facilities and tasks – and the private partner contributes capital, technology and operational expertise. The local authority remains a shareholder, has a say in decisions and is responsible for fees. At the same time, profits from third-party business are generated, which flow back into the municipal budget as additional income – earmarked for specific purposes. This is real economic relief with full municipal control.
What are typical preconceptions – and how do you counter them?
Opelt: The assumption that fees will rise or employees will be made redundant is incorrect. The local authority retains control over fees, and we are not laying off anyone – quite the contrary. We are creating new jobs and developing additional services. Employees will be assigned to other departments or taken on by other companies if they wish. We know from experience that after a short time, a well-coordinated team emerges that benefits from joint development.
How does that work in practice?
Albel: Vilach has been working with Saubermacher for 24 years. At that time, the municipal waste disposal company had 66 employees and a turnover of €4.3 million. Today, it has 90 employees and a turnover of €14.3 million. This was made possible by new business areas: commercial customers, event management and modular room rental. Employees even benefit directly from the company’s success, e.g. through bonuses. The model is both economically and socially stable.
What about investment capacity?
Pilz: With a PPP, the municipality can contribute its investment assets to the company and receive liquidity in return. This can be used, for example, to build new municipal service centres or purchase vehicles – without incurring new debt. The profits from the joint operation flow into the regular budget. This enables us to secure our long-term public services.
How does the integration of staff work?
Or: Employees can be assigned or transferred as desired. Salaries remain the same, as do entitlements. Those who do not wish to change remain in the municipality. Trade union structures also remain integrated. The staff are a central part of the partnership.
What would you recommend to local authorities considering a PPP?
Opelt: It is important to conduct a thorough feasibility study to realistically assess the economic potential and requirements. This is followed by a clear tender process and, on this basis, a contract that protects both sides. Those who plan openly and strategically from the outset will quickly see that 1 plus 1 is more than 2 in this case.
The discussion took place as part of a panel discussion at the Austrian Cities Day 2025.
