By Abdul Ghani

In a major move, Pakistan Railways (PR) has decided to outsource its nationwide schools network under a long-term Public-Private Partnership (PPP) framework, according to documents available with Wealth Pakistan.

The outsourcing process will follow a single-stage, two-envelope bidding process under the Rehabilitate, Upgrade, Operate and Transfer (RUOT) model. The schools will be handed over to the private concessionaires for 30 years. The concession period will include a two-year mobilization phase, during which the selected private operators will be responsible for infrastructure development and operational planning.

The bidders will primarily be evaluated on financial strength, and in the financial evaluation, at least 65 percent of the marks will be mandatory for qualification. Significant financial guarantees have also been proposed. The bid security requirements include Rs10 million for schools in provincial capitals, Rs5 million for district headquarters schools, and Rs3 million for schools located at tehsil level.

According to documents, the private concessionaires will be required to make a one-time upfront payment for each project. In addition, a revenue-sharing formula has been proposed under which a benchmark of at least 10 percent of gross revenue will be set as the minimum share payable to the department.

The department has also reserved 5,000 seats for children of railway employees under a quota arrangement. The fee for the students has been fixed at Rs1,000 per month with an annual increase capped at 5 percent.

The capital expenditure (Capex) and operating expenditure (Opex) related to rehabilitation, upgradation, utilities, and salaries of contractual staff will be borne entirely by the concessionaire. This means the private operators will assume full financial responsibility for running the institutions during the concession period.

Under the quality standards, the concessionaires will be responsible for the overall implementation, financing, operation, maintenance, and rehabilitation of the allotted schools strictly in accordance with the concession agreement. Pakistan Railways, however, will retain monitoring and oversight authority and may appoint its officials or independent consultants to regularly assess educational standards, teacher performance, infrastructure quality, and compliance with agreed benchmarks throughout the concession period.

The documents also indicate that the procedure for outsourcing schools, recruitment process, and advertisements for clerical posts will be reviewed by a committee before final placement, suggesting centralized oversight over staffing decisions.

The development comes as the department continues exploring alternative revenue models and public-private partnerships to reduce operational losses and improve service delivery across its non-core sectors.

Credit: INP-WealthPk