Rs. 1.6 trillion for road projects since 2007, says report highlighting underperformance

Governments have sunk Rs 1.6 trillion into the highways sector in the 13 years since 2007, with the highest expenditure having been in 2017, the Roads and Highways Ministry's latest Performance Report states.

The money has gone into expressways, national highways and flyovers and bridges on national highways, says the 2019 report which was recently presented to Parliament.

While the Mahinda Rajapaksa administration had a reputation for dumping money into the road sector, both the highest expenditure and the largest allocation for highways were under the Yahalapana administration. Last year, it was Rs. 256.5bn-- the biggest quota for highways since 2007.

The report also reveals that the office of the Roads and Highways Minister received an allocation of Rs 60mn last year, when compared with Rs 27.8mn the previous year. This was an increase of 130.7 percent and Rs 55.2 mn was fully used.

The money given to the Minister’s office is divided into capital (for rehabilitation, improvement and acquisition of capital assets) and recurrent expenditure which is for personal emoluments, travelling expenses, supplies and maintenance.

Meanwhile, the Government has borrowed more than Rs 277bn from local banks between 2011 and the end of last year for road development projects. Local bank financing for roads started in 2011 when foreign donors were not forthcoming for certain projects. But money is also borrowed from domestic institutions when there is a bridging gap in foreign-funded projects, particularly for land acquisition.

Last year, around Rs 37bn was disbursed through local banks for Road Development Authority initiatives. The most money was lent by the Bank of Ceylon while the least was by DFCC Bank PLC.

The report shows that the Ministry

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has underperformed in most of its targets, citing financial constraints as the reason. For instance, it had been aimed to increase the length of expressways by 102.6km, only 57.6km of length--or 56 percent of the target--was achieved. The reason for the poor performance, the report justified, were constraints in both local and foreign financing.

Although it was proposed to increase the length of highways by 623km, performance was around half of that. Widening and improvement also showed lower target achievement due to lack of funds. From the planned length of rural roads, around 1132 km were completed by the end of last year (75 percent). Here, the reason is given as “low achievement of improvement works of weak bridges project”. The proposal was to complete 43 bridges last year but only 14 were done, again “due to financial constraints”.