The major infrastructure projects are usually (always?) awarded by tender to private consortiums. For example Melbourne's Westgate Tunnel which is $4 billion over budget is being built by CPB contractors and John Holland (a Leighton subsidiary). The biggest issue to me in this area seems to be that governments don't hold private consortiums to their tender price. When a company runs billions over the price they've quoted, the cost overrun appears to get pushed back to the taxpayer, rather than being worn as a potentially bankrupting event by the builder. Anyone know why developers aren't held rigidly to their quoted price?
