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MoT to analyse, cut infrastructure projects

Update: April, 16/2015 - 09:35
The Ministry of Transport said it will re-examine transport infrastructure projects throughout the nation and eliminate those deemed as unnecessary to cut down spending from the State budget. — Photo vietbao

HA NOI (VNS) — The Ministry of Transport said it will re-examine transport infrastructure projects throughout the nation and eliminate those deemed as unnecessary to cut down spending from the State budget.

The move aims to curb the increasingly alarming problem of inflating budgets for transport projects, which end up guzzling investment capital.

Several reports have been made of projects demanding more investment capital than their initial budgets, but only after they begin, thereby tying the hands of many involved parties.

In one case, the initial investment budget for the Ha Noi-Hai Phong Highway project was quoted at VND24.5 trillion (US$1.1 billion) but, shortly after construction began, the contractor said that it would actually need VND50 trillion ($2.3 billion) to finish.

The Cau Gie-Ninh Binh Highway was another example. The project had an estimated cost of VND3.7 trillion ($170 million), however, it has been gradually increased to VND8.9 trillion ($409 million).

Deputy director of the ministry's Department of Construction Management and Transport Quality Duong Viet Roan, said the reason for the increases are due to unnecessary scale and execution of the projects.

For example, he said, in highway construction projects contractors could add soil to weak roadbeds and monitor them throughout the construction progress. However, most constructors purposefully chose to build viaducts that cost three or four times more and are improper to the actual need.

For flyover construction projects, due to a shortage of national standards, some flyovers are built to be 4.75 metres tall instead of the standard 4.5 metres. This can significantly increase the cost of a project, Roan said.

To solve the problem, Nguyen Ngoc Long, an official from the ministry's consultant group said that it was necessary to set up an inspection team to tighten control over design and consultancy work.

Investors will be made responsible for choosing the scale of their projects instead of relying on design and consultancy units; this would curb waste in purchasing building materials.

Another expert from the group, Tong Tran Tung agreed, saying the establishment of an inspection group would help curb unnecessary costs such as lighting systems along the Lang-Hoa Lac and HCM City-Trung Luong routes.

Minister Thang said it was necessary to re-examine transport projects, and tighten up construction in-progress to cut down investment capital by 15 to 20 per cent.

Previously, the ministry re-examined a series of projects and saved up to VND40 trillion (US$1.8 billion), more than VND11 trillion ($506 million) of which was from inflated designs. — VNS

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