The main shortcoming of the conventional approach to appraisal and development of megaprojects is the lack of mechanisms for enforcing accountability, namely the absence of, on the one hand, clear objectives and, on the other, arrangements for: (i) measuring how objectives are being met; and (ii) rewarding good and penalising poor performance. In this chapter, we will identify a number of basic instruments that we see as necessary for strengthening accountability. However, before discussing these instruments, we consider in more general terms the roles to be played by the private and public sectors in the development of megaprojects. Understanding the appropriate roles of the two sectors is fundamental to the identification of a process for appraisal and decision making that will ultimately work in the public interest.

Redrawing the borderlines of public and private

A basic issue that is both complex and likely to stir controversy is the question whether megaprojects should be publicly or privately led. Neither the complexity of the issue nor its potential for controversy should come as a surprise. After all, one of the most fundamental aspects of public policy is at play, namely that of defining the frontier between the public and private sectors.

For major infrastructure projects one could argue an either/or position on public versus private leadership:

• either such projects should be placed entirely within the public sector – for example in a government department, an agency or a state-owned enterprise – to ensure accountability through the rules of transparency and public control that apply to the public sector;

• or such projects should be placed entirely in the private sector – for example by means of build-operate-transfer or other concession arrangement – to ensure accountability through competition and market control.