Unpaid bills delay road projects

by Lalin Fernandopulle

Construction of roads and highways, a penchant of the Rajapaksa regime, which turned into a well-spring to amass wealth, ran into serious difficulty when the government was left with a hefty outstanding bill of Rs. 38.178 billion to be paid to local contractors for work done up to December 31, 2014.

Working Director, Road Development Authority (RDA), Keith Bernard said there were new bills to the tune of Rs. 17.2 billion from December 31, 2014 to May this year.

“The outstanding amounts on the Katunayake Expressway, preliminary work of the Northern Expressway and the Outer Circular Highway phase one and two were staggering. We had to first get a grip of what had taken place, the scope of work, how far it had been completed, financial commitments and ways to settle contractors,” said Bernard.

“This took around two months and it is during this period that the new government came under fire for bringing development projects to a halt,” he said.

The Working Director said the RDA was saddled with huge unpaid bills. Despite the burden heaped on the Authority by the previous regime through the misuse of funds, bills to the tune of Rs.40 billion were paid by new government from January to-date.The former regime came under a barrage of criticism for misappropriation of funds under the guise of infrastructure development.

Experts said that the astronomical cost of the Katunayake Expressway on which the former regime had spent around Rs. 1.8 billion per kilometre was the most costly highway in the world. The cost per kilometre of the 26km expressway had been doubled enabling officials associated with the regime to swindle around Rs. 1 billion per km. The regime was dislodged for its scale of bribery, corruption and nepotism. The new Minister of Highways took steps to settle the outstanding amounts in a judicious manner and resume work on road projects under a proper transparent plan.As of now all contractors have been paid for work completed and under progress by solving the working capital problems and bank commitments, Bernard said.

He said close to the 2015 presidential election, road construction work was awarded to associates of the regime with no competitive bidding.

Contracts were awarded in an unsolicited manner. There was a high concentration of power and control in the former RDA chairman. Decision-making was confined to a few although there were managers and other officials in the RDA. There was mismanagement and lack of transparency.

“Even though there were around 600 engineers it was the contractors and consultants who dictated terms. In certain contracts, contractors decided which roads to construct and they made estimates. Most of the contracts were signed with little negotiation,” the Working Director said. Steps have been taken to develop rural roads by which the villagers can integrate into the mainstream economy so that the benefits of development will trickle down to them.

The Government with Asian Development Bank funding is fast tracking work on integrated rural road projects. Dilapidated roads and bridges will be renovated.

Work on the Southern Expressway extension which connects Godagama and Hambantota has resumed. Work on the Outer Circular Highway phase two has been completed and by the middle of this month the section between Kaduwela and Kadawatha is due to be opened.

“Plans are being finalised to launch construction work on the Outer Circular Highway phase 3 between Kadawatha and Kerawalapitiya. The mobilisation fees has been released to the contractors and work is expected to begin soon with certain modifications to rationalise cost.

The Government has decided to commission the Central Expressway before the end of 2015 subject to revision of scope to optimise financial needs.

Funding for the project has been pledged by China Exim Bank, ADB and JICA. Finances will be supplemented with local funding.