NOTHING excites our politicians more than mega projects. Their enthusiasm becomes even more apparent as they run hither and thither to cut ribbons in expensive ceremonies for big-ticket projects as the general elections approach.

It was recently in the news that over 1,000 federally funded projects face delay and cost overruns of Rs7.4 trillion. For a debt-ridden, fiscally distressed country, this is a very unproductive use of resources.

Are we really good at building mega projects? Consider the case of the Neelum-Jhelum hydropower project. It is being built for eons and has seen cost overruns to over Rs4 billion. Similarly, the Karachi sewerage plan has seen cost overruns of over Rs30bn.

Hundreds of our projects face delay and cost overruns are in the trillions.

Another example is the new Islamabad international airport which has seen massive cost overruns and delays since 2007. Even after delay and cost overruns, two planes wouldn’t be able to land concurrently due to faulty design (thereby defeating the objective to increase traffic).

It makes one wonder why politicians, particularly in a debt-ridden country, suffer from a ‘monument complex’ (as Dr Flyvberg of Oxford University puts it) even when hundreds of our projects face delay and cost overruns are in the trillions?

Flyvbjerg points to four aspects to answer that. First is the technological aspect. Technologists and engineers are lured by the idea of creating the ‘biggest, largest, tallest, first’ project. Technical challenges excite engineers and technologists, ergo, they become mega-project promoters. Second is the political aspect. Politicians love building monuments because they create an image of ‘building big hence thinking big’ mentality and attract attention (from media and others). This, in turn, creates an illusion of proactively working for social welfare. Third is the economic aspect since mega projects create jobs and affect businesses lawyers, architects, engineers, unions, businessmen and contractors all advocate these. Fourth is aesthetics. Since designers and architects get pleasure from constructing beautiful and large buildings they also inadvertently support mega projects.

I think behavioural science offers some insights too. Our politicians are able to promote so many mega projects because the mechanism we currently have to vet them is bizarrely built on what Nobel laureate Dr Daniel Kahneman calls ‘system 1 thinking’ (part of the brain that forms fast, subconscious, emotional and automatic thoughts), instead of ‘system 2 thinking’ (part of the brain that forms thoughts which are slow, effortful, logical and calculated). “Projects are selected on the whim of executive instead of cost-benefit analysis”, said a former deputy chairman of the Planning Commission.

Second, the perceived link between risk and benefits, as identified by psychologist noted Paul Slovic, is exploited by politicians in power to gather support for mega projects.

For instance, the information about something can say its benefits are high which makes people perceive the risk as low. The information can also be put in a different way ie the risk is low and people can infer the benefits are high. Both have a positive effect. The reverse ie high risk and low benefit can be communicated in a similar way, though this information will have a negative effect. Either way, politicians in power are able to amplify this deliberate framing of information, to their benefit, more than others, often through state-owned media, political clout and lack of meaningful debate on how projects are vetted.

Mega projects aren’t a total flop. If done right, they create employment and help local economy but only when suitable projects are undertaken, based on extensive planning and cost-benefit analysis.

Bad projects inflate utility bills, reduce savings, increase debt and provide easy targets, for successive governments to shift blame. The burden is also passed on to posterity thanks to decisions they never were a part of. Surely, a fiscally challenged country can definitely find more productive allocation of resources. We have to completely change the way we select and execute our mega projects.

All mega projects must go through ‘system 2 thinking’. Moreover, our planning process doesn’t guard against cognitive biases and Flyvbjerg’s pointers which it should. Projects must be selected on merit instead of their size. New techniques like ‘reference class forecasting’ should be used to evaluate new projects.

In this case, past projects must also be studied to see if they actually fulfilled their potential instead of celebrating their success mindlessly and endlessly, and the findings can be applied to the project at hand. The absence of cost-benefit analysis, and incorrect (benefit and cost) forecasts should be made criminal offences. We, as citizens, also need to beware of psychological exploits at work. Focusing on improving our project management capacity has never been more important since number of mega projects will only grow in future.

The writer works in the technology sector.
Twitter: @wyounas

Published in Dawn, November 16th, 2017