Experts link project costs to inefficiency

Project management and construction professionals have linked disparities between government-financed infrastructure projects and those by other players to poor planning, procurement inefficiencies and delayed payments. The widening disparity between the cost of government-funded infrastructure projects and similar projects financed by development partners resurfaced in Parliament a fortnight ago after Minister of Education, Science and Technology Bright Msaka described as “daylight thievery” quotations ranging between K1 billion and K4 billion for constructing community day secondary schools (CDSSs). Nsanje Central legislator Francis Kasaila (Democratic Progressive Party) also told Parliament that CDSSs projects in the country were being built at inflated costs of over K1 billion compared to similar structures funded by private financiers.

He cited a secondary school in Mwanza funded by German charity Green Helmets which cost 110 000 euro (about K267 million). The project includes classrooms and six teachers’ houses. In an interview last week, Construction Sector Transparency Initiative (CoST) Malawi chairperson Engineer Samuel Biton said that such disparities should not be viewed as a result of a single factor, but as evidence of systemic weaknesses across the entire project cycle.

He said government projects often go to tender before designs, site investigations and risk assessments are fully completed, resulting in costly contract variations, delays and additional works during implementation. Said Biton: “One of the biggest challenges is inadequate project preparation. In some cases, projects proceed to procurement before designs are fully completed, site investigations are properly undertaken or risks are clearly understood.

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“Another significant challenge is delayed payments. When contractors do not receive certified payments within the contractual periods, they are entitled to claim interest or financing charges on delayed payments as compensation for the time value of money lost due to late settlement by the employer.” Malawi University of Business and Applied Sciences (Mubas) lecturer in construction management Wakisa Simukonda shared similar views, saying while project costs are naturally influenced by factors such as project scope, procurement methods, contract type, material prices, inflation, exchange rate movements and quality specifications, poor project planning and management significantly inflate costs. “Poor project planning and management significantly contribute to inflated construction costs by reducing efficiency and increasing waste throughout the project lifecycle,” he said.

Reacting to the concerns, Malawi Building, Civil Engineering and Allied Trades Association (Mabcata) vice-president Kondwani Kadango also acknowledged the cost disparities, attributing them largely to the risk factors associated with government-funded projects. He said: “Most of the government projects do not run according to the signed contract, because most of them take years to be implemented. “So contractors put into consideration their own resources they have put and say ‘if I have to wait for a whole year before getting my payment, how much will the value of the money be at the time I receive’.

While donor funded projects, you are assured that the project will be completed in time because money is readily available.” But Ministry of Transport and Public Works spokesperson Chikondi Chimala dismissed suggestions that government condones inflated contract prices. In a written response, he said the ministry neither approves nor encourages contractors to inflate bids based on assumptions that payments will be delayed.

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