This part is designed to analyse the context of PHS or the PHS framework. In the first chapter, the characteristics of the demand side, supply side, services and public authorities in PHS are described. The second chapter presents the recent evolutions in PHS’ demand and supply and explains the increasing need for PHS. Finally, in the third chapter, it is demonstrated that without supporting policies, the PHS sector cannot be developed to its full potential. Finally, the last chapter provides the rationale for public intervention in the PHS sector. The figure below summarises the structure of this part of the document and provides some key findings.

• The important features of PHS
• A sector with extensive growth and job creation potential
• Hindered development when supporting policies are not implemented
• Identifying the rationale for a public intervention targeting on PHS activities
• Policy pointer – Step 1