In Nigeria, roads are the epitome of public finance
and often used by public officials, especially the governors, to demonstrate
achievements. We are often inundated with public announcements indicating how
many kilometers of roads have been built since they assumed office.
In a political climate like Nigeria, it is
understandable to link road construction with achievements- roads facilitate
intra-country trade, aiding movement of goods and services and allowing for
higher productivity that leads to further economic growth.
Road construction is also critical in an unexpected
way according to Transparency international, contracts for public
works/construction has the highest propensity for corruption through bribery on
bidding and super inflated costs of such construction.
So, apart from the fact that road costs are often
very high, not usually financed by development aid, costs skyrocket even more
when corruption and political instability are present according to the World
Bank. Particular attention then needs to be paid, not just to roads
construction, but also to roads maintenance as they take a good chunk of public
finance in a country like Nigeria with a poor corruption index.
Usually, costs are high because of many factors, one
of which is the different terrain. For example, roads in certain parts of the
country would cost more than in other parts because of the soil conditions.
However, other negative factors increase the cost further.
Involving private sector in roads maintenance has
gained traction since 2000s when low and high income countries started to
implement what is known as the Performance Based Maintenance Contracting
(PBMC), outsourcing road maintenance to private firms with clear performance
indicators, using long term contracts for specific sectors of roads, and often
with negotiated price upfront.
The advantages include the cost saving for as much
as 30 percent for government, sharing of risks by government and the
contractors, reducing the need for highly specialized people on permanent
government payroll while allowing better specialization and skills of the
private/local construction companies, contributing to the growth of that
sector.
As the contracts are often performance based,
governments would only pay based on how targets set are met. PBMC often focus
on routine maintenance including fixing of potholes, guardrail maintenance,
lights maintenance and litter pick up on highways, urban roads, bridges etc.
The contracts would exclude major repairs like
bridge repair. To have a successful PBMC in place, there must be enough skilled
personnel available to the contractor to undertake successful maintenance on a
long term, while saving costs, as well as advance financing since governments
will only pay after specific performance indicators set have been met.
Even with the advantages to government and growth of
the construction sector, this is still a difficult process to implement.
Corruption and high cost necessary to start affect bidding, discouraging
competition and participation. Even when successful, local construction
companies have to grapple with the highly specialized skills and equipment
necessary for ongoing maintenance of roads and could be thwarted by staff of
government public works agencies who risk losing their jobs – except when an
arrangement is made for government skilled workers to be taken over by the
contractors.
In making PBMC work, political patronage and
corruption have to be eradicated. Technical schools and engineering colleges
must be restructured to ensure relevant engineering skilled and government has
to make certain waivers on importation of equipment. Government must also be
willing to let go of some control, and provide flexibility to contractors to
determine an optimized mix of technical solutions and execution schedule
without any interference from key stakeholders.
Obileye is a UK-trained lawyer and CEO, Great
Heights Property & Facilities Management Limited
Email: Tundeobileye@greatheightslimited.com
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