Delays and cost overruns

Published November 2, 2015
Bengali believes whenever a govt revises the cost of a project, it always opens a window for corruption.— psgf.org.pk
Bengali believes whenever a govt revises the cost of a project, it always opens a window for corruption.— psgf.org.pk

DELAYS in the completion of projects — whether executed by the federal or provincial governments — are routine affairs in Sindh owing to bureaucratic hassles and a lack of administrative capacity, required skills and expertise.

This results in cost overruns and wastage of taxpayers’ money.

The Right Bank Outfall Drain II (RBOD-II) project was launched by the federal government in 2001 to rehabilitate the Manchhar Lake, which was being destroyed by the continued inflow of effluent and salt water.


Whenever the federal or the provincial government revises the cost of a project, it always opens a window for corruption and unnecessary works — Dr Kaiser Bengali


The project — supposed to be completed in 2006 at a cost of Rs14bn — would take saline water (current 3,500 cusecs against the previous estimate of 2,271 cusecs) from Sehwan to Gharo Creek, Thatta district, while also connecting with RBOD-I, which is commonly known as the Main Nara Valley (MNV) drain.

Having been abandoned for quite some time, the project is set for a second cost revision by the federal government. Its cost had gone up to Rs29bn after the first revision, and now a relevant official has indicated that the proposed escalation might take the cost to around Rs60bn. So far, an expenditure of Rs26bn has been incurred, leaving an unreleased amount of Rs3bn.

Two previous project completion deadlines — January 2006 and December 2014 — have already passed. The government’s consultants are revising their estimates.

After getting approved by the provincial planning and development department, the revised cost would need a nod from the Executive Committee of the National Economic Council (Ecnec). An official said following the recent flood damages, the government is trying to rationalise the project’s cost by curtailing the number of structural works (currently around 435). According to one report, around 30 structural works might be discarded.

Latest expenditure details indicate that inadequate funds have been released for works, which is delaying payments to contractors. Besides, work on different spots and structures had to be duplicated. For instance, against the allocation of Rs3.5bn, only Rs1.05bn was released during FY2009-10. And releases in the subsequent years have been equally low, forcing the Frontier Works Organisation’s unpaid contractors to stop working.

When Dr Kaiser Bengali was the adviser for planning and development to Sindh’s chief minister, he had reduced a number of ‘throw forward’ projects for ensuring timely releases of pending funds. Around 464 projects have been thus been completed.

Bengali believes whenever the federal or the provincial government revises the cost of a project, it always opens a window for corruption and unnecessary works.

“There is a ‘childish’ approach of governments where they suspend the projects initiated by their predecessors and prefer those they have launched themselves,” he says.

But one official pointed out that the recent completion of the Hyderabad-Mirpurkhas road project showed that projects could be completed on time.

In case of delays in execution, agricultural land around the Manchhar Lake could no longer be reclaimed; the lake has not been rehabilitated for the last 15 years.

“Manchhar Lake was once the country’s vital wetland and is now degraded due to the disposal of effluent into it. As a result, its fauna and flora, as well as the fishermen community, have been seriously affected,” says Nasir Panwhar, Executive Director of the Centre for Environment and Development.

He complains that no public hearing for the environmental impact assessment (EIA), which is mandatory for such projects, has been held and it is being implemented sans mitigation plan. When the project was designed, the Indus was 2km away from the drain, but now the river has changed its course and gotten closer to the drain, he adds.

“We told the federal secretary for Wapda, which is building the remaining two components — RBOD-I and RBOD-III — that inadequate financial releases that are short of the allocated instalments will not help us,” says a project officer.

According to RBOD-II Project Director Ejaz Sheikh, 76pc of physical progress has been achieved.

The super floods of 2010 had damaged the project’s infrastructure as it ran parallel to the river at various locations. And water had also inundated the drain after the 2010 and the recent floods.

The lake’s contamination has forced a large-scale migration of fishermen as they lost their source of their livelihood. The lake is also no longer a home to migratory birds, and agricultural lands that were dependent on its water have been hit by salinity.

Published in Dawn, Business & Finance weekly, November 2nd, 2015

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