Economics and Financing

Part 2 provides guidelines for conducting benefit–cost analysis (BCA) and multi-criteria analysis (MCA) on public transport infrastructure projects, policies and programs—any choice in fact that can be characterised in terms of positive and negative economic impacts. Its aim is to foster good practice, consistency and transparency in the evaluation of transport projects. It does so by setting out a comprehensive set of procedures and assumptions to be incorporated in all evaluations, and by recommending an accessible and standardised format for the presentation of results. Part 2 also provides guidance on risk assessment and analysis in project evaluation. These guidelines assist the user to incorporate risk into the evaluation of investment proposals. A tool (Risk ExplorerTM software) used for identifying, assessing and analysing risks related to uncertain factors impacting on project benefits and costs is included to help the practitioner perform a risk assessment and analysis. Part 2 is applicable to most projects requiring evaluation, but excludes the following classes of project that raise methodological problems that should be left to specialists: (1) very large projects with complex impacts; and (2) public-private partnerships type projects that require a kind of accounting-based analysis known as financial analysis.