Because private investors shoulder upfront costs -- as well as the considerable risk that their investment might fail -- they have strong incentives to make sure projects are completed on time and on budget.

CNN: Road tax alternative: Pay for each mile you drive

Mr Holtham added: "It's very important therefore to be careful in negotiations and also to make sure that the projects you're spending it on are really worthwhile for the economy because you will be paying for them".

BBC: Wales

The city had to cut public services, shed jobs, freeze pay, abandon capital projects and raise taxes to make sure it could pay back the federal loans.

ECONOMIST: Economics focus