March 24, 2006	Friday	Safar 23, 1427

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ISLAMABAD, March 23: The government has decided to establish a high-powered independent entity under the planning and development division to overcome the problem of project design, causing billions of rupees loss to the economy every year.

Informed sources told this correspondent that a number of multi-billion rupees worth of projects of vital importance to the country ran into snags every year because the Planning Commission did not have the capacity to identify design problems.

The government is also considering placing funds directly at the disposal of line ministries and executing agencies to avoid the problem of delay in the release of funds, particularly for the projects executed by the provincial governments.

In many cases, the lenders providing funding to mega projects withdraw financing because of their slow progress or diversion of their funds to other sectors.

For example, the World Bank and the Asian Development Bank withdrew part of their financing for the Rs31 billion National Drainage Programme because of slow progress and diversion of funds to other projects.

In many cases, the government had to divert funds to other sectors because of design faults in certain projects.

Sources said the Planning Commission had recently informed the prime minister that design mistakes in some of crucial projects had almost blocked their progress.

The prime minister had agreed to the commission’s proposal to establish a core project design and management unit to overcome design and management problems, particularly in large lender- funded projects.

The prime minister directed the commission to ensure hiring of project directors at the inception stage and not to regularly transfer management staff associated with particular projects to enable them to understand and complete the projects.

The prime minister, said the sources, was informed that work on about 23 mega projects — including Satpara, Gomal Zam and Mirani dams – was behind schedule mainly because of design problems.

For example, construction of Satpara dam has been stopped by the government because major faults were noticed in the project design, although it had been cleared by the Central Development Working Party and Executive Committee of National Economic Council.

Similarly, the government has directed the sponsoring ministries to review project implementation on a monthly basis with relevant agencies and contractors and submit monthly progress reports to the Planning Commission.