Prodigal sums: governments are still spending billions on infrastructure construction, but such schemes usually overrun and blow the budget. Neil Hodge asks what financial managers can do to keep these mega-projects on track.

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Prodigal sums: governments are still spending billions on infrastructure construction, but such schemes usually overrun and blow the budget. Neil Hodge asks what financial managers can do to keep these mega-projects on track.

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Although the world's biggest companies may be scaling back their growth plans, some of the biggest countries are intent on pouring cash into massive infrastructure projects in a bid to stimulate their economies and stave off unemployment. Last November, for example, China announced a construction programme worth [yen]4trn (390bn [pounds sterling]). India has earmarked Rs23.4trn (316bn [pounds sterling]) for public building projects and this February the US announced a stimulus package worth $787bn (524bn [pounds sterling]).

Even if you take these schemes out of the equation, the level of investment in public construction projects has never been higher. In 2004-08 China spent more on i...

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