In this chapter, we look at the governance of the public works authority (PWA). We argue that PPPs share some of the same defects as standard public works, related to improper project design, selection, and opportunistic renegotiations. Because these problems are due to failures of governance in PWAs, our analysis leads to recommendations to address these weaknesses. We explore some issues specifically related to the governance of PPPs, but our recommendations are applicable to the governance structure of the PWA in general.

Why PPPs Need Good Governance

When delivering infrastructure, governments face three challenges: first, deciding what and when to build; second, building it cost effectively; and third, ensuring proper maintenance and service quality thereafter. Governments in general have been unsuccessful at meeting these challenges. In many countries, infrastructure facilities include white elephants or earmarks directed at particular political constituencies; pricing is inefficient; there is X-inefficiency and lack of innovation and technological advance. Because resources are limited, these projects are built at the expense of socially worthwhile projects. It is not unusual for infrastructure procurement to be opaque and even corrupt, and the PWA is often biased against maintenance spending. Heggie and Vickers describe the reason for these shortcomings in the case of roads, but their description is applicable to most types of infrastructure: