/0003 4 Economic Economic Commission Im., Development Institute for Africa X40020v of The World Bank 4å6V SUMAHAR SMCAE TRaiSmw FRwGRAM The Road Maintenance Unätative Buildi2ng Capacihj for PONiCY Reform Vonume 2. Raing and CL22 Stu dne PolesPietro S- E DI SEMINAR SE RIES EDI SEMINAR SERIES SUB-SAHARAN AFRICA TRANSPORT PROGRAM The Road Maintenance Initiative Building Capacity for Policy Reform Volume 2. Readings and Case Studies The World Bank Washington, D.C. Copyright 5 1991 The International Bank for Reconstruction and Development / THE WORLD BANK 1818 H Street, N.W. Washington, D.C. 20433, U.S.A. All rights reserved Manufactured in the United States of America First printing September :991 The Economic Development Institute (EDI) was established by the World Bank in 1955 to train officials concerned with development planning, policymaking, investment analysis, and project implementation in member developing countries. At present the substance of the EDI's work emphasizes macroeconomic and sectoral economic policy analysis. Through a variety of courses, seminars, and workshops, most of which are given overseas in cooperation with local institutions, the EDI seeks to sharpen analytical skills used in policy analysis and to broaden understanding of the experience of individual countries with economic development. Although the EDI's publications are designed to support its training activities, many are of interest to a much broader audience. EDI materials, including any findings, interpretations, and conclusions, are entirely those of the authors and should not be attributed in any manner to the World Bank, to its affiliated organizations, or to members of its Board of Executive Directors or the countries they represent. Because of the informality of this series and to make the publication available with the least possible delay, the manuscript has not been edited as fully as would be the case with a more formal document, and the World Bank accepts no responsibility for errors. The backlist of publications by the World Bank is shown in the annual Index of Publications, which is available from Publications Sales Unit, The World Bank, 1818 H Street, N.W., Washington, D.C. 20433, U.S.A., or from Publications, Banque mondiale, 66, avenue d'I6na, 75116 Paris, France. Library of Congress Cataloging-in-Publication Data The Road Maintenance Initiative : building capacity for policy reform. p. cm.-(EDI seminar series) At head of title: Sub-Saharan Africa Transport Program. Contents: v. 1. Report on the policy seminars / Steve Carapetis, HernAn Levy, Terje Wolden- v. 2. Readings and case studies- v. 3. Guidelines for policy action planning / Carl Duisberg Gesellschaft. ISBN 0-8213-1859-4 (v. 1).-ISBN 0-8213-1860-8 (v. 2).-ISBN 0-8213-1861-6 (v. 3) 1. Roads-Maintenance and repair-Government policy-Africa, Sub- Saharan-Congresses. 2. Roads-Maintenance and repair-Economic aspects- Africa, Sub-Saharan--Congresses. I. Sub-Saharan Africa Transport Program (International Bank for Reconstruction and Development) II. Series. HE367.A452R63 1991 388.1'068-dc2O 91-21666 CIP EDI Catalog No. 720/020 Foreword The constraints that inefficiencies in the transport sector impose on economic development in Sub-Saharan Africa have long been recognized and have been recently underscored in the Long- Term Perspective Study of Sub-Saharan Africa prepared by the World Bank. Despite the great experience of donors in financing transport projects, the effectiveness and sustainability of past programs designed to increase the performance and efficiency of transport services have been disappointing. In this context the World Bank, in close association with the UN Economic Commission for Africa (ECA) and several primary donors, has developed the Sub-Saharan Africa Transport Program (SSATP). The main objective of the program is to improve transport efficiency through major policy reforms. It also provides the ECA with substantive inputs for the preparation of the Second UN Transport and Communications Decade for Africa, which will serve as a framework for mobilizing energies and resources to improve the performance of the transport sector and pursue its development. The program is an excellent example of the cooperation that can be achieved by African countries and international agencies in addressing difficult policy issues through a regional approach. This book is one of three volumes that report on a series of six subregional policy seminars organized by the World Bank and the ECA under the Sub-Saharan Africa Transport Program to address the problems and issues of road deterioration and maintenance. These policy seminars provided a forum in which policymakers from different countries, leading experts in development, and World Bank staff were able to share ideas and experience concerning development policies that relate to road transport and maintenance. These reports are now being published for widespread distribution as a guide to defining future activities, programs, and initiatives for reforming road maintenance policies in Africa. Recognizing that policy reform is a complex, dynamic, and long-term task, all who participated in the seminars see the effort and these reports as the beginning of a long process. Amnon Golan Ismail Serageldin Director Director Economic Development Institute Technical Department World Bank Africa Region World Bank iii I Contents Preface vii Overview of Seminars ix Project Brief, Terje Wolden 1 A Policy Foundation for Better Roads 7 Road Deterioration in Sub-Saharan Africa, Melody Mason and Sydney Thriscutt 13 Topic A - Planning, Financing and Management 38 Road Financing and Pricing in Developing Countries, Ian E. Smith 41 Planning, Programming, and Budgeting for Road Maintenance, Asif Faiz 50 Road Maintenance Management and Operational Planning, Robert C. Petts 66 Case Studies Ethiopia: Making Management Systems Work 73 Ghana: The Road Network Stabilization Program 74 Kenya: Minor Roads Programme Maintenance System 78 Kenya: Goal Oriented Project Planning 82 Malawi: Maintenance and Rehabilitation Management System 85 Niger: A Practical Management System for Programming Periodic Maintenance 90 Nigeria: A Case for Increased Maintenance Spending on Federal Trunk Roads 94 Tanzania: Road Financing and Pricing 98 Topic B - Management of Operations 103 Equipment Management, Michael Leonard 107 Appropriate Use of Available Resources and Technology, Jan de Veen 115 Use of Local Contractors and Consultants, Richard H. Neale and Derek Miles 123 Case Studies The Gambia: Pilot Labor-Based Road Maintenance Project 131 Ghana: Feeder Roads Project 138 Kenya: The Development of the Rural Access Roads Program 143 Kenya: Rural Road Maintenance 146 Lesotho: Equipment Management 149 Madagascar: S.C.C.C. - Small Local Roadworks Consulting Firm 153 Madagascar: Ets. Razakamandimby - Small Local Roadworks Contractor 155 Nigeria: Use of Local Contractors and Consultants 158 Topic C - Human Resources Development and Institutional Reform 164 Institutional Development in Road Maintenance Organizations, Richard Robinson 168 Human Resources Development and Management, Colin Relf and Sydney Thriscutt 178 Case Studies Assessment of Maintenance Capability 182 Sri Lanka: Training in the Construction Industry 189 U.K.: Evaluation of Incentives for Efficiency in Road Maintenance Organization 191 U.K.: Twinning Arrangements Between Staffordshire County in the United Kingdom and Accra City Council in Ghana 195 Annex 1 - Road Maintenance Policy Seminars - Agenda 199 Annex 2 - Contents Volume I and Volume III 204 V Preface The present process of economic reform in Sub-Saharan Africa has far-reaching implications for the transport sector. Against a background of a deteriorating transport system and the high cost of providing new road infrastructure, issues of transport policy become especially prominent. These issues are inherently difficult to deal with because transport is almost always an intermediate output. As a first step toward addressing these issues and helping governments improve their own capacities to address transport problems, the Sub-Saharan Africa Transport Program (SSATP) was initiated in 1987. The Road Maintenance Initiative (RMI) is one of the key components of the SSATP. It has been envisaged as a project with a five-year duration (1987-92), in two phases. Phase I consisted of six subregional policy seminars. Repr: sentatives from forty-two Sub-Saharan African countries attended one of the seminars held between May 1989 and February 1990 in Harare, Accra, and Addis Ababa (for anglophone countries) and Dakar, Libreville, and Antananarivo (for francophone countries). Country delegations to these seminars normally included ministers of public works, heads of highway departments, and senior officials from ministries of planning and finance. The objectives of Phase I were to develop awareness of the consequences of neglect of the road network, to recognize the policy nature of the problem, to identify key areas for policy improvement and endorse related policy options, and to engage delegations in the preparation of policy reform plans for their own countries through Policy Action Planning exercises. Phase II will include facilitation support for national activities directed toward improving national capacity to deal more effectively with important policy issues and reforms. Activities will consist of country-level development of Policy Action Plans for highway maintenance and will be designed to create a broad national commitment for policy changes and institutional reforms. Implementation of the Policy Action Plans with monitoring and evaluation would follow Phase II. The Phase I policy reform seminars were organized by the SSATP Unit in the Infrastructure Division of the World Bank's Africa Technical Department and by the Infrastructure and Urban Development Division of the Economic Development Institute of the World Bank in close collaboration with the ECA. The SSATP has been made possible by the support, financial and otherwise, of a number of international donors. The RMI and the policy seminars, specifically, benefitted from donor assistance from the governments of France, Germany, Norway, Sweden, Switzerland, and the United Kingdom. The Carl Duisberg Gesellschaft, the International Labour Office, SETRA, and the Transport and Road Research Laboratory provided help and guidance. The RMI seminars were conducted in two parts, beginning with an introduction to and discussion of, the regional issues in road maintenance. Three broad areas were considered: planning, budgeting and financing; operational efficiency; and institutional reform and the development of human resources. Following two days of presentations and discussions, individual country teams explored and applied the Policy Action Planning method, which was vii presented in workshop exercises designed to demonstrate a systematic procedure for prioritizing problems and developing policy reform action plans to resolve them. The documentation for the Phase I seminars are being published in the following three reports: Volume 1: Building Capacity for Policy Reform Volume 2: Readings and Case Studies Volume 3: Guidelines for Policy Action Planning The production and editing of these reports are a joint collaborative effort of the Infrastructure Division of the Africa Technical Department and the Infrastructure and Urban Development Division of the Economic Development Institute of the World Bank. viii Overview of the Seminars This book reports on the first phase of the Road Maintenance Initiative (RMI), a project under the Sub- Saharan Africa Transport Program (SSATP). The SSATP is a joint program of the World Bank and the United Nations Economic Commission for Africa (ECA) and is sponsored by a number of bilateral financing agencies. The objectives and modus operandi of the SSATP are: An emphasis on policy responses to key transport sector issues and on strengthening capabilities for policy development at the national and regional level * Implementation through a series of discrete components (each defined in terms of specific outputs) in partnership with development agencies and African institutions, with participation by African experts and advisers * A light management structure with flexible arrangements for participation and each component defined up to closure with specific outputs. Activities of the SSATP are closely coordinated with the preparation of the UN Second Transport and Communications Decade for Africa, 1991-2000. Within the general framework and objectives of the SSATP, the Road Maintenance Initiative (RMI), focuses on road maintenance. The RMI originated in the need of African countries to halt and, it is hoped, reverse the massive deterioration of the African road networks. The critical situation is illustrated by the following facts. * About half the region's paved roads and 70% of its unpaved roads are in only fair to poor conditions and require substantial repairs. * The region's losses in increased road transport costs, caused by lack of maintenance, are estimated at $1.2 billion a year. * According to World Bank estimates, the cost of overcoming Sub-Saharan Africa's road maintenance backlog is US$5 billion, and about US$1.15 billion will be needed annually over 10 years to reconstruct priority roads to good condition and to provide routine and periodic maintenance for good roads to prevent them from further deterioration. The RMI's program is based on two essential postulates: (a) The core problem of road maintenance is not rooted in technical matters but is political and institutional. (b) Any change in policies, to be effective, must be rooted in a firm awareness, at the highest level of government, of the importance of road maintenance. The aim of the RMI is to facilitate policy change. The lack of success with externally initiated or directed reforms, highlights the need for alternative approaches that African governments can use to improve their capacity to deal with complex policy reforms themselves. The RMI addresses this need through a more ix structured, multiphase program over 5 years, to be closely coordinated with programs and projects financed by international and bilateral lending agencies in order to maximize effectiveness. The first phase of the RMI consisted of six subregional policy seminars at which senior policy makers, including ministers, discussed road deterioration, and exchanged experiences and views on various policies, their appropriateness in the African context, and how best to introduce them through collaborative preparation of national action plans. Each Sub-Saharan African country sent a team of three to five officials from ministries related to planning, financing, budgeting, and implementation of road maintenance and rehabilitation programs. The country teams were normally led by the minister or deputy minister responsible for road maintenance. The seminars were preceded by careful preparation over a two-year period. A survey of the road maintenance and road deterioration situation in each country was carried out, and materials were prepared: eight Policy Issues Papers that addressed the main issues, focusing on the nature of the issue and the relevant policy options; several case studies illustrating African examples of successful policy reform; a module on Policy Action Planning with guidelines and examples for developing action plans for policy and institutional reform, and, for each country, a Country Review and Analysis that country teams could use to identify the key policy issues and assess the relevance and applicability of policy options. The seminars themselves consisted of two parts. The first concentrated on a discussion of key policy issues with the aim of building commitment to policy change. The second presented an approach to Policy Action Planning and gave country teams an opportunity to explore and apply it to their national situations. The issues covered in the seminar, grouped under three themes, and the participants' reactions, are summarized below. A. Planning, Financing and Budgeting Developing a network-based framework for planning. Currently, in most countries, planning and programming road expenditures is divided between new investments and maintenance. This hampers efficient allocation of scarce resources and has resulted in a significantly lower allocation of total road expenditures for road maintenance than required and economically justified. Participants agreed that the lack of a unified, or network-based, framework for planning made it difficult to allocate resources rationally. Even in Senegal, which is devoting 80 percent of road funds to maintenance, available finance is spread thinly among highways, and as a result, few, if any, of the roads receive the attention they need. Collecting and disbursing funds. Not only must the total level of funding be adequate, but it is also vital that resource flow be regular and dependable. When budget mechanisms consistently fail to provide the amount required in a dependable manner, the setting up of a Road Fund, rigorously managed and monitored and funded with earmarked resources, may be the best option. Participants generally favored this approach, although in some cases national budgetary procedures did not allow for the earmarking or creation of special funds, and in other cases such funds were not deemed necessary. Participants also pointed out that fairness, and efficiency in cost recovery, posed questions regarding the imposition of tolls or special taxes on trucks with heavy axle loads -- which are especially destructive of pavements - in both national and international transit traffic. Performance budgeting. Efficient and transparent budgeting procedures require the establishment of quantifiable objectives and quality controls and the implementation X of institutional changes to make possible financial as well as technical audits of road maintenance works. Participants agreed that, in general, ministries of public works were not organized for or concerned with the efficient use of allocated resources. Performance budgeting could increase accountability and provide an important image of effective planning and good use of resources, thus increasing the likelihood of attracting higher levels of funding. B. Operations and Management Reducing force account and increasing contracting. Almost exclusive reliance on public sector force account operations has led to over-staffing, lack of incentives for capable staff, and rigid controls and rules that inhibit staff initiatives in adopting cost-effective management solutions. Governments accepted that, in situations of labor shortages and huge backlogs of road maintenance, the increased use of contract maintenance could be a viable option. Domestic contracting and construction industries, however, are often underdeveloped and would require assistance and encouragement to strengthen the industry. Key factors in the development of the industry would be stable markets and supportive policies, training programs, simplified procurement and contract procedures, timeliness and reliability of payment procedures and, possibly, joint ventures with international firms. Such a transition would have to be planned and phased over time and requires serious commitment and a long-term view. A combination of direct labor and contract work, with the proportion of contract work increasing over time, is indicated. Local contractors rarely have the capital for equipment but in some cases governments have leased them equipment. Many roads departments may lack the necessary skills mix for this type of arrangement and would need to address this in their staff development and recruitment programs. Increasing use of labor-based operations. Constraints on resources and the availability of under-employed or unemployed labor that can be mobilized for up to $4.00 daily often makes the adoption of labor-intensive maintenance techniques economic. Several countries reported positive results, including reduced costs and increased maintenance effectiveness. Success depended on terrain, population density and climate. Labor- based approaches, however, also require the decentralization of supervision, administration, contracting, and payment authority, as well as technical assistance and staff training. Participants concluded that this may be the only feasible approach under conditions of extreme resource constraint. Further, they agreed that there were considerable economic and social advantages, including savings in foreign exchange. Also it could provide for the use of rural and communal groups in the execution of the work. Reducing publicly owned equipment fleets. Maintenance managers have been overburdened by the need to keep up huge -- and often incompatible - equipment fleets. Availability and utilization is very low: in some countries only about 20% of the national road maintenance fleets is in working condition. The result are fleets with unnecessarily high operating costs. This represents a large wasted investment, much of which is in foreign exchange. Smaller fleets with higher availability and utilization rates would save money while raising productivity and reducing unit costs and management overhead. The reforms indicated include autonomous agencies responsible for equipment management, commercially run equipment pools, centralized xi spares purchase, and contracting out equipment maintenance (as well as road maintenance tasks as mentioned above). The lack of standardization emerged as a major concern of participants, who also saw the potential for addressing this issue through modified policies of external aid agencies and better planning and packaging of their programs for external aid. C. Institutional Reform and Human Resources Development Institutional reform. Most road authorities in Sub-Saharan Africa inherited institutional structures, procedures, and systems from pre-independence days, and these are now in urgent need of review and revision to make them more directly relevant to current circumstances. As referred to above, the delivery of parts of the road maintenance program through contractors would help achieve some desirable changes. Also, some of the institutional systems such as local procurement procedures are in need of streamlining. Participants acknowledged the need for changes that are tailored to the specific situations and needs of countries. They felt that such changes should aim at a progressive reduction of the role of the state, with the emphasis on a leaner and more efficient government organization. Separate, autonomous road authorities seemed to be necessary, at least during the coming decade while roads systems pass through a crisis period Improving staff motivation and utilization. Apart from the issues relating to institutional organization and structure, participants agreed that human resource development is one of the most critical factors in addressing road maintenance. At present, constraints on personnel utilization and development caused by inappropriate and inflexible public employment policies result in serious problems: lack of staff accountability; difficulties in retaining competent staff; loss of good staff to the private sector; lack of on-the-job development and motivation; lack of application of previously learned skills, stagnation, and waste of expensive education and training; and generally low levels of manpower productivity. One advantage of autonomy in road agencies is that they can avoid becoming financially overburdened with unneeded staff and thus increase funds applied to operations, supplies, and equipment. They can also promote staff on merit and can remove nonperformers. Creating a personnel unit and strengthening line managers are key to this issue. Line managers will need skills in setting objectives, allocating work, delegating, setting standards, establishing accountability, and providing on-the-job training, recognition, and feedback. Participants also identified as other important contributions to improved staff performance: giving staff greater responsibility, increasing motivation, establishing productivity bonuses, and improving opportunities for training. Regarding training, they endorsed the idea of reinforcing national training programs and, if necessary, creating regional training structures. Participants concluded that before defining their needs for technical assistance, they should make full and efficient use of qualified and experienced local staff and, to the extent possible, deploy them in key planning and decision making roles. Expatriates should be assigned to temporary short-term positions with clear terms of reference, measurable and monitorable objectives, and strong incentives for training local staff. xii Policy Action Planning The second part of the seminars was the conduct by country teams of Policy Action Planning (PAP), following the approach developed by the Carl Duisberg Gesellschaft. The approach consists essentially of three stages: * Road maintenance constituencies identify the constraints and functional deficiencies the sector faces. From this analysis, priorities are determined and then transformed into concrete objectives. * Participants define the measures needed to achieve the objectives. These measures are critically screened taking into account financial, human, and institutional constraints. An action agenda is established. * Responsibilities, resources, and the time frame for implementation are determined. By bringing out the agendas of all the constituencies involved and showing the areas of possible conflict, the PAP process ensures that both the resource-allocating agencies and the line agencies have a realistic framework for seeking compromise and consensus. The seminars were successful in introducing the Policy Action Planning concept and demonstrating its value in policy formulation and decision making. Participants found PAP's focusing and consensus-building attributes extremely valuable; the process was also praised as a powerful tool for bringing issues to the surface and making choices between them explicit. The PAP's cross- ministerial structure was also found particularly valuable. Participants suggested that the PAP as presented would benefit from full-scale testing in a Sub-Saharan African country and that one aim would be to find ways to streamline and simplify the process. The participants found a surprising level of commonality in the road maintenance problems each country faced and in their priorities in ranking these problems. In the anglophone seminars, those countries more committed to maintenance, with better institutions and financial resources, tended to identify planning, programming, and budgeting, and improvement of staff capabilities and skills as the overriding issues; countries at the other extreme of the spectrum, particularly the poorest countries, appeared to focus more on the level of funding as the main issue. In the francophone seminars, the pattern was less well defined. The better-off countries focussed on the planning and use of funds, while at the other extreme priorities were diffused over a larger number of issues. Follow-up The follow-up phase (Phase II) of the RMI will support the preparation of policy reforms in a limited number of areas that are central to better management of road infrastructure. That phase will also build up the capacity of selected training institutions, such as ESAMI, to provide process assistance to policy reform in road administration and management. Phase II would be: * Driven by country initiatives under the aegis of an interministerial committee or steering group xiii * Targeted at a limited number of important policy issues requiring action by several departments or agencies * Closely coordinated with ongoing and planned programs by external financiers * Designed in harmony with the priorities established by the National Coordinating Committee that will be responsible for the preparation of the country's contribution to the Second Transport and Communications Decade. The start-up of Phase II involves invitations to preselected countries and joint studies by the World Bank and lead bilateral agencies to assess the country requests and make a decision. Burkina Faso, Cameroon, Madagascar, Mozambique, Nigeria, Rwanda, Sierra Leone, Tanzania, Uganda, and Zimbabwe have been identified as candidates for Phase II. xiv Terje Wolden Sub-Saharan African Transport Program Road Maintenance Initiative - Project Brief Introduction Road Maintenance and Deterioration The inefficiency of the transport sector in most coun- Countries in sub-Saharan Africa are losing capital tries in Sub-Saharan Africa is a major impediment to through the massive deterioration of their roads. Large economic growth and national and international trade. networks, built at a great expense, have been under- Sector needs for improvement are vast. Systems suffer maintained and are often more heavily used--and from inadequate maintenance, burdensome regulation, abused--than expected. If this deterioration is and inefficient operations-resulting in high costs and allowed to continue, it will accelerate as old pavements unreliable services. Furthermore, managers and staff are crumble and newer ones outlive the grace period relatively untrained and institutions capable of addres- following construction when neglect has little visible sing these problems are lacking throughout the region. effect. The World Bank/ECA Sub-Saharan Africa Transport An economy cannot grow while it is neglecting road Program (SSATP) aims to help African governments maintenance. In fact, letting roads deteriorate simply improve and sustain transport efficiency through policy means that road users' vehicle operating costs and later reform and institutional improvement. It is being restoration costs to the governments exceed many times designed and implemented at a time when collaborative any "savings" made in disregarding road maintenance. efforts between the Bank and ECA are necessary to This has been demonstrated in the World Bank's report exchange views and experiences relevant to the prepara- on Road Deterioration in Developing Countries.' Local tions for a second UN Transport Decade. It comes at a highway officials, in most cases, recognize the time when governments are becoming more receptive dimensions of the problem but have been unable to to policy reforms to improve their overall economic arrest the process while it could still be done at development performance. reasonable cost. Now, the task facing many govern- ments is to salvage valuable infrastructure that has The SSATP is made up of a number of projects cover- severely decayed, while at the same time protecting ing specific important aspects of transport policy. Each newer vintages of roads from a similar fate. This task project includes elements of: has major policy, institutional and financial dimensions. * research, to deepen knowledge in specific areas Road networks in 39 countries total over one million where the basis for policy advice is not yet known; kilometers-about 300,000 kins constitute main net- works of paved and gravel roads. To appreciate the * surveys, to provide or improve the data basis for burden of road maintenance in each country, we must policy analysis in the region; note that the ratio of main road network length to GNP ranges from 0.4 to 14.5 km for every million dollars of * policy analysis and development, to identify policy GNP. These ratios are highest in the developing world, responses, to build consensus and to engage policy making road maintenance financing especially difficult makers and senior sector managers in the considering also that normally the foreign exchange formulation of action plans for reform; and component is about 50%. Even under the best management and institutional arrangements road * human resources and institutional development, to network management is costly relative to the financing build capacity and enhance manpower in order to capacity of Sub-Saharan African countries. improve the operation, organization, and management of transport institutions. After these road networks are constructed, the essential works of routine maintenance and resurfacing are frequently postponed. Among the competing demands for resources, new construction or reconstruction may Terje Wolden seem the more attractive and perhaps more expedient Task Manager for the RMI, choice because new roads bring quick and tangible Is an engineering consultant economic results, whereas maintenance requires the seconded by the Norwegian slower development of supporting institutions and Government to the World Bank benefits are apparent only in later years. But endemic road deterioration can quickly create a crisis in the 1 Terje Wolden Project Brief transport sector. The Bank has estimated the current bilateral donors. ECA has discussed road maintenance backlog of road maintenance in Sub-Saharan Africa to on a number of occasions during the last few years, and cost about US$5 billion and that about US$1.2 billion at the Fourth African Highway Maintenance Conference will be needed annually for routine and periodic main- in Harare (December 1987). One of the specific tenance in order to prevent further deterioration. suggestions made at that conference was that the road deterioration problem be presented to the African The economic effects of neglecting maintenance will Transport Ministers Conference in Kinshasa this Spring always be borne by the road users in the form of to obtain their endorsement of efforts made under the increased vehicle operating costs, since a poor road is SSATP. The ECA and the Bank together did this, and 20-40% more costly to transport goods than a good the draft resolution below was unanimously approved. road. In the lifetime of a road, the accumulated vehicle operating costs can amount to from 3 to 10 times the * Review of budgetary mechanisms including ear- construction cost of the road itself. In the end, there- marking and creation of road funds to reallocate fore, reducing expenditure on road maintenance will not funds for road maintenance and rehabilitation. serve the intended purpose of freeing resources for other activities. Instead, road users, mostly in the * Institutional strengthening of road agencies. private sector and a high proportion of whom require foreign exchange for spare parts, tires and replacement * Training and motivational initiatives to improve vehicles, pay these costs. A comparison of costs for institutional performance and reduce staff turnover. preventive maintenance and rehabilitation shows that when maintenance is neglected and rehabilitation * Reliance on locally available resources including becomes necessary, the cost per km increases from 2.5 appropriate and more labor-based technologies. to 8 times the cost of regular maintenance. Therefore, by failing to redirect public spending to maintenance and constructing new roads, some African countries Objectives have been found to lose 3 to 4 kms of potentially good roads for every km of new roads they construct. The World Bank, in collaboration with the ECA and several bilateral donors, has designed the SSATP Road Road transport prices in Africa are on average 2.5 to 3 Maintenance Initiative for African policymakers and times higher than in other regions of the world. senior managers to: (Incidentally, construction costs in Africa are markedly higher than elsewhere.) Available statistics reveal that * increase their awareness of, and reach common transport costs are more than 15% of the prices of assessment on, the magnitude of the road mainte- several African export commodities. The land-locked nance problem, and to increase their motivation and countries pay additional transit charges amounting to commitment to address the problem by changing about 20% of the value of goods transported, making attitudes and behaviors; many commodities less competitive in global markets. In the end who pays the burden of high transport costs? * identify appropriate technical, financial, and Mainly the already impoverished farmers in the coun- organizational policy options, and develop policy tries' interior. action plans for specific road agencies and institutions; and Arresting the deterioration process and repairing damage already suffered will require serious govern- * support and monitor the implementation of national ment commitment and coordinated efforts by the inter- policy reform plans, and assess the effectiveness of national donor community. Changes in policy and the plans carried out. improvements in institutions and management, good choices of technical options and, in some cases, an Through these initiatives it should also be possible to increase in the amounts and reliability of financial establish or strengthen regional institutions to assist inputs to the road sector will be necessary. In other countries in road maintenance policymaking and plan- cases the length of maintained road networks may have ning. At the same time, the action-oriented Road Main- to be reduced in order to direct available resources to tenance Initiative will improve cooperation and coordi- road links with the highest social and economic priority. nation among international lending institutions and bilateral aid donors. The Road Maintenance Initiative Issues to be Addressed An agenda for action has emerged from the experiences of governments, proceedings of conferences, and from Addressing policy improvement and institutional reform the experience of international lending agencies and is undoubtedly a priority. The following concerns are 2 Terje Wolden: Project Brief considered important to finding effective, long-term design of highways and maintenance programs, taking solutions and taking the appropriate steps to resolve the into account not only the costs to the government, but road maintenance and deterioration problem. also the much larger costs of vehicle ownership and operation borne by road users. Policymakers, Institutional Reform of Road Agencies. African policy- particularly those with budget constraints, will have to makers should consider, if warranted, separating compare the economic consequences of different planning and supervisory functions from the execution maintenance options in the context of actual conditions of maintenance and construction works, and manage- to find the best network-level maintenance policies. ment policies to strengthen accountability of staff at all levels for the use of resources and for carrying out Human resources. There is scope for improved staff in tasks and reaching institutional objectives. Account- several facets of road maintenance-from the substitu- ability may also have to be extended from the tion of unskilled labor for machinery to the govern- managerial level to the political level and to road users. ments' difficulties in retaining competent managers, In countless instances political and private interests engineers, technicians, etc.-giving rise to the demand have brought pressure on road authorities to divert for more effective manpower planning, training and resources intended for road maintenance. The effect of development programs to anticipate and meet needs. disrupting the maintenance mission of the road These plans should not only address the quantitative authority is the same, regardless of motives. The requirements of the training program, but the qualitative consequences of road neglect are a matter of public aspects as well, and should be based on an analysis of interest and, as such, they need to be made known to the kinds of skills that need to be developed. the general public and potential interest groups to stimulate the coalition of interests necessary to Local resources. The use of labor-based methods can influence public policy. be more cost effective than equipment for many main- tenance activities where wage rates are low. These It is significant to note that in all cases where there has methods are less dependent on foreign resources and for been substantial success in establishing effective road that reason are normally less susceptible to disruption. maintenance institutions there have been individuals in They create needed employment opportunities and in- positions of responsibility who grasped both the impor- crease self reliance. Simple equipment, which can be tance of the maintenance function and the necessity for made using locally-based technologies and local the efficient use of resources. Without political commit- materials in road pavements and structures, can also be ment at some level the maintenance function invariably considered. suffers from neglect. Local Contractors and Consultants. Identify appropriate Budgetary mechanisms. Insufficient funding and delays policy reforms to enable effective participation of local in the release of funds remain a problem for road civil contractors, plant repair shops, and consultants in maintenance and rehabilitation. Reallocation of funds executing many tasks presently undertaken, or from new construction to rehabilitation and maintenance attempted, by road agencies. will be necessary in practically every country. This reallocation will not be easy given the mechanisms of Project Description the budgeting process. Nevertheless there is a need to seriously attempt such reallocations, if necessary, The Road Maintenance Initiative is envisaged as a five- through the reclassification of certain maintenance year project, to be carried out in three phases. expenditures as capital expenditures. This will require the commitment of finance ministries, as well as Phase One consists of a series of Policy Seminars appropriate roads ministries. designed to bring African policymakers together to exchange experiences and views on the above issues. Policymakers will have to consider such options as The Seminars are designed to: earmarked funds or road funds to ensure sufficient allocations of road user revenues for road purposes. * increase awareness, and reach a common as- This puts a clear focus on road expenditure and offers sessment of the magnitude of the road deterioration a basis for better planning and accountability. problem; A systematic analysis may be required to determine how much should be spent on roads, and how. Some . identify appropriate operational, financial, orga- governments may need to revise user charges or impose nizational or other policy options relevant and new ones which, if translated into better roads, can applicable to addressing and redressing the road reduce rather than increase the cost to the public. deterioration problem; Technical options and economic consequences. Severe * give participants the opportunity to discuss and competing demands for resources require economic explore the relevance and applicability of these 3 Terje Wolden: Project Brief policy options to their own circumstances; are enough to convince others. If too many countries give positive response after the seminars, those few * obtain, where possible, the commitment of policy- countries first where both the Bank and the sponsoring makers to pursue these policy options--with donor community feel there is a chance of success both external technical and/or financial assistance where in raising funds for Phase 2 and 3, and in implementing required and requested; policy reforms will be given selection priority. * increase participants' awareness of the support and The detail and design of Phase 2 has not been commitment by the donor community to the pursuit established, since it is expected to be country specific, of these policy options and concomitant investment and therefore to be elaborated by the countries programs. themselves. Funding for this phase of the RMI is expected to come from the aid donors, in particular The focus of the Phase 1 seminars of the RMI will be from the donors that support Phase 1, and/or donors to assist a group of high-level policymakers in policy supporting the transport sector in the volunteering action planning so that they can discuss specific policy countries. changes required in their countries to improve road maintenance, and let them develop during the seminar Through a detailed country-specific diagnosis stage of a simplified action plan comprising a set of realistic the Phase 2, the countries are expected to tailor the policy reforms for their countries. In addition the design of that phase and the policy action planning seminar is designed to develop commitment and atti- workshops to the needs of particular countries. Esta- tudes. We hope to find that high-level officials in blishing inter-ministerial committees to guide this work several participating country teams have the will to has also been proposed for particular countries. change policies. Without such a person inside the government of a participating country, it will be In a Third Phase following the establishment of the difficult to bring about significant policy changes. action programs, participating governments will meet to discuss their experiences with the action plans in terms By the end of the first series of seminars we should of progress and problems during implementation, and know which of the sub-Saharan countries have realistic remedial steps identified as necessary. views of their needs for changes in policy; we would be better informed as to how committed each delegation Phase 3 could include both implementation of the poli- is to reforms; and by requesting them to come back to cy reform and activation of a physical program of us in writing after they have returned to their countries, rehabilitation and preventive maintenance (resealing and we should get a true indication of their commitment. regravelling) of roads. Coordinated external support for restoring the road networks would be handled by the In a Second Phase, follow-up workshops will be held operational divisions of development agencies including for governments willing to commit themselves to the World Bank. The SSATP would marshall support policy-action plans. In preparation for these workshops, for region-wide mobilization of resources needed for governments will prepare detailed assessments of their the restoration program, and focus on the implemen- road maintenance situations including policies, road tation of policy reform programs. The SSATP would inventories, manpower and financial resource continue to provide opportunities for country interac- projections, and reviews of plans in the roads sector. tions to assess progress and compare experiences in Technical assistance may be provided if requested to implementing the program. Through the transport data assist with these preparatory activities, which would component the SSATP will also be able to follow up include: the introduction of new policies and provide some information about changes in efficiency and perfor- description and assessment of the highway orga- mance within the sub-sector of a particular country. nization; Phase One, Policy Seminars identification (diagnosis) of specific problems; The Economic Development Institute of the World definition of a certain number of policy reforms Bank is assisting the program in the design, preparation and prioritizing of decisions (action plans); and presentation of the series of six seminars. implementation plans; Participants. A series of six Seminars will be designed for, and delivered to, all countries in Sub-Saharan cost estimates. Africa. Each government will be invited to send a team of officials from relevant ministries related to the It is hoped that at least a few countries will volunteer planning, financing, budgeting and implementation of for Phase 2. Only a few good demonstration projects road maintenance and rehabilitation programs. Because 4 Terje Wolden: Project Brief the Seminars are aimed at exploring policy options and road deterioration problem in physical and financial bringing about policy changes, dialogue will be con- terms. Then topics A-C will be presented and discussed. ducted with ministers and top civil servants who work This will serve to identify the major policy issues and at the level of government where substantive policy problems related to road maintenance and rehabilitation. reforms would be initiated. Accordingly, the country The objective of the first part of the seminars will be teams would be led by the Minister responsible for the to create positive awareness of the issues and problems, central roads department, normally the Minister of and to change attitudes and build commitments towards Public Works or Transport, depending on the organiza- policy changes to address the issues and problems. tional arrangements for each particular country. He would be accompanied by the Chief Engineer (Roads) The second part of the Seminars will introduce and or Roads Director responsible also for maintenance and present instruments and approaches to policy action rehabilitation programs. The country teams would inclu- planning and give the individual country teams an de senior officials of the Ministry of Planning and the opportunity to explore and apply policy action planning Ministry of Finance and would be directly responsibile instruments and approaches to their particular situation for programming and budgeting road expenditures. and circumstances. Each team may present a report to Country teams will consist of three or four officials, the closing plenary session. depending on the country. Their specific composition will be discussed and agreed with the relevant World In addition to the participants, moderators, presenters, Bank Country Department prior to sending out the discussion leaders, resource people and Seminar organi- invitations to the prospective participants. zers will attend each Seminar. For practical and logistical reasons and to minimize Collaborating Institutions. As the associated agency of costs the series will be run in two groups-the first, the SSATP with the World Bank, the ECA Transport, consisting of three anglophone seminars, and the Communications, and Tourism Division will participate second, three francophone seminars. in all seminars. In addition, the Seminars will benefit from collaboration by a number of agencies that fall Content and Format. Each seminar will address three generally under three headings; aid donors; technical major topics. These have been divided into themes for assistance institutions and African regional and sub- the preparation of background papers with relevant case regional organizations. By involving a number of studies: regional and subregional organizations in various roles and capacities one will try to achieve two additional A. Planning, Financing and Management for road objectives: maintenance and rehabilitation programs, speci- fically * an institutional development objective through the exposure to, and participation in, the seminar Planning, Programming and Budgeting, presentations and discussions on this matter of Physical Planning and Management, and critical importance to Africa; and Financing and Pricing Mobilization. to obtain, for the benefit of the participants of the B. Operations and Management of road maintenance seminar, the value of the knowledge and experience and rehabilitation activities, specifically of these organizations in the area of policies and their impact on road deterioration. Equipment Management, Appropriate Use of Available Resources and A coordinating group of representatives of BMZ, ILO, Technology, and NORAD, ODA, SDC, SIDA, and the SSATP/EDI Use of Local Contractors and Consultants. meets as required (about once every 6 months) to review and discuss the Road Maintenance Initiative. C. Institutional Reform and Human Resource Develop- ment in relation to road maintenance and rehabi- Preparation. Preparatory efforts for the Seminars- litation, specifically a survey, papers and case studies, action planning guidelines, and country reviews-are in progress and Institutional Development, and are described below. Human Resource Development and Management Survey of the road maintenance and road deterioration Each Seminar will begin with a presentation of an situation in each country, and the preparation of an introductory paper to describe the state of road introductory paper. In 1987 and early 1988, question- maintenance and rehabilitation in the region, and to naires were sent to all countries in the region to gather highlight key issues and requirements to combat the information on road maintenance activities in each 5 Terje Wolden: Project Brief country including data on the present condition of the they will constitute an important part of the presenta- road system, maintenance costs, physical accomplish- tions leading to discussions on how to tackle problems ments, availability and use of resources. A compilation through policy change. of the returns was the basis for a study on the state of Formulation of Policy Action Planning Guidelines road maintenance and rehabilitation in Africa, and has includin ofaplicy ion pannn Gidelines been used to prepare a policy paper on Road Deteriora- n ing examples, will be prepared to help partici- tion in Sub-Saharan Africa, which will be used for an pants in the process of developing action plans for introductory presentation at the seminars. The survey policy, istitutional and other reforms and changes. data will also be used to update the 1982 statistics on The guidelines will highlight the effect of social which the "Road Deterioration in Developing Countries, and political concerns and pressures on maintenance Causes and Remedies" paper was based.policies. Before arriving at the seminar each country team will Preparation of Policy Issues Papers that address the prepare a Country Review and Analysis for their use specific Seminar topics focusing on policies, policy and benefit in considering the relevance and appli- options, policy actions and policy action planning. cability of policy options to be presented and reviewed Emphasis will be given to ongoing policies and their at the seminars. The review and analysis will be in the contribution to the current state of affairs on the road form of a questionnaire, and will cover the statutory systems and to optional alternative policies and their and administrative processes, procedures and cons- prospective roles in ameliorating the road deterioration traints, including the various institutions and agencies problem. Case Studies will illustrate actual African involved and their respective roles, relating to the examples of situations where a policy action planning formulation, analysis, approval and implementation of process has been adopted and implemented, preferably policy changes in the areas described under the three successfully. Each case study will be closely coordi- main topics as these relate to the issues of road nated with the writing of the policy paper and together maintenance and rehabilitation. Endnote: 1. "Road Deterioration in Developing Countries: Causes and Remedies", A World Bank Policy Study. Washington DC, 1987. 6 A Policy Foundation for Better Roads* Introduction funds to allow departments of roads to effectively plan and implement their programs. A well maintained road network is of paramount impor- tance to the development of Sub-Saharan Africa. The second issue is accountability. In the absence of Practically 90% of land commerce is dependent on public pressure and lacking a clear understanding of the roads. African governments and their external partners seriousness of the problem, few governments have have recognized the importance of good roads and have given road maintenance a high priority in their budgets. devoted substantial resources to improving road The urgency of the situation has not always been fully networks over the last 30 years. appreciated by all donors and lending agencies, some having been readier to provide funds for new construc- Significant achievements have been made in expanding tion than for maintenance and restoration. New cons- road networks across the continent. But, building the truction has sharp political visibility, maintenance little infrastructure of institutions and trained manpower to glamour. Inadequate maintenance in developing coun- maintain them has proven difficult. Ineffective tries has various causes, but institutional weakness is at maintenance has led to widespread and accelerating the heart of the maintenance problem. road deterioration-amplified in recent years because the large number of roads built in the 1960s and 1970s The goals of roads departments must be set in terms of have reached the end of their useful lives and need to tangible physical performance. Planning, programming, be rehabilitated or reconstructed. and budgeting should focus on improving roads in terms of precisely defined and rigorously monitored The road maintenance and rehabilitation problem has physical conditions. This can only be achieved if an been exacerbated-as are almost all the region's information system is in place that informs planners of problems-by the current economic difficulties in Sub- both the state of the roads system and the results of Saharan Africa. Roads, however, are so much an engine previous maintenance outlays. of growth that making economically justified expendi- tures to ensure their continued serviceability deserves Accountability should also be turned outward towards priority attention in government spending. the road users who are most immediately and directly affected by road conditions. It is the users, rather than There has been a growing realization that road building road maintenance organizations themselves who, bear and road maintenance are not in balance. Policies that the immediate costs of poor roads. There is a vast favored construction over maintenance clearly have to public constituency in Africa for good roads; it should be changed in favor of approaches that focus on road be encouraged to operate as a monitor of national road expenditures as a whole within a policy framework that systems and an advocate of their improvement. enhances transport availability at minimum overall social cost-to government road agencies, and, more The third major issue is the need to adapt, improve, importantly, to the road users. and reform institutions so they have both the mecha- nisms and the necessary incentives to increase their The first issue to be addressed in this Seminar is a efficiency. The staff and managers of those institutions national commitment to maintain a serviceable roads will need new skills to carry out these tasks; devel- system. A critical requirement is a broader financing opment of human resources must go hand-in-hand with and budgeting perspective that sees road building, the development of sector institutions. maintenance, and rehabilitation as a unified process with a multi-year perspective. This perspective The problem of institutional efficiency applies to all recognizes road users as an important constituency who countries of the region. There is little point in would rather pay fair charges to use good roads than increasing funds if they are not used efficiently. the much higher vehicle operation and time costs result- Planning for road maintenance, which includes budget ing from roads in poor condition. It is a perspective that estimation and preparation, can be strengthened by recognizes it is not enough to allocate funds for roads; Maintenance Management systems like the ones in use that a real commitment includes a dependable flow of in Malawi, Niger and Zimbabwe (and more recently, in This paper was prepared by the RMI unit in Africa Technical Department to be used as basis for the World Bank Presentation at the seminars. 7 A Policy Foundation for Better Roads Kenya). These three issues serve as the backdrop to our The transport sector-particularly roads-is key to discussions at this Seminar. unleashing the potential for increased production and incomes in Sub-Saharan Africa. There are telling examples where transport bottlenecks have put the The Economic Background brakes on growth, especially in agricultural production. The objectives for transportation can be captured in two Road conditions in Sub-Saharan Africa cannot be words: efficiency (and thus lower cost) and sustaina- isolated from the general economic situation in the bility. Poor economic performance has meant that levels region. Sub-Saharan Africa is confronted with slow of gross investment and maintenance expenditures in economic growth, declining agricultural production and many countries have not been sufficient to preserve and a heavy burden of external debt. In most countries GDP modernize infrastructure and equipment. Institutional and income per capita have been stagnating or declining structures and national economic and sectoral policies for more than a decade, while population growth has have not been responsive to changing market demands continued at a rate that adds 20 million people each or have not adequately supported the build-up of year. The net flow of capital to the region declined sufficient technical and managerial capabilities. from about US$14.0 billion in 1981 to US$8.5 billion in 1985. Total external indebtedness now exceeds Nowhere are these policy initiatives more needed than US$100 billion and debt service, even after resche- in the roads sector. If farmers and manufacturers are duling, consumes about 30% of export earnings. Per to take advantage of reforms in agriculture and other capita investment in real terms declined by half from productive sectors they must have a dependable road 1980 to 1987 while imports, in constant dollars, fell by system. Without efficient transport-and in Sub-Saharan 35%. Africa transport means, more than anything else, roads-there can be no supply response to support As a result, the average African is poorer today than he renewed growth. was in 1970. This is clearly unacceptable and hard policy choices must be made by African governments to reverse the trend. Fortunately, an important and The State of Sub-Saharan Africa's Roads unprecedented intellectual and economic revolution is taking place in Africa. It began slowly in the early An assessment of road conditions based on limited data 1980s with a handful of countries undertaking economic available for 41 countries shows that nearly one-quarter reform programs aimed at increasing productivity and of paved roads are in poor condition and a further stimulating growth. Today, more than half of the quarter in fair condition. The situation is even more Region's countries-from tiny market-oriented countries serious for unpaved main roads where nearly 40% of such as Togo, Mauritius and the Gambia, to large, roads are in poor condition and an additional 33% in initially more socialist-oriented Ghana, Guinea and fair condition. Tanzania-have embarked on these programs. The pro- grams deal comprehensively with public sector manage- A regional breakdown is shown on the next page. Some ment, public finance and parastatal reform. They roads can be saved if quick action is taken; otherwise, include the introduction of realistic exchange rates they will either be lost, or will have to be rebuilt. The and improved incentives for agricultural production, as indications are that in spite of great efforts made by well as adjustment in trade regimes and promotion of governments and donors over the past five years, it has exports. One of the main objectives of these reforms is only been possible to barely stabilize the situation. to create a better environment for enterprise devel- opment, unleashing the enormous entrepreneurial ener- To appreciate why endemic road deterioration can gies of the people. The ultimate aim of these reforms quickly create a transport crisis, we shall briefly is the resumption of growth, sustainable growth with examine its physical evolution and its financial equity. implications. The progress being made reflects the determination the Deterioration of paved roads is gradual and hardly African countries themselves expressed at a 1986 perceptible during the initial phase after construction, special session of the United Nations General Assem- lasting from 10 to 15 years, sometimes up to two-thirds bly, when they declared that "Africa has taken the main of the pavement life-cycle. Even this seeming "grace responsibility for its own development ... African period" can be drastically shortened when traffic countries are determined to take, individually and volumes and axle loads exceed the designed capacity of collectively, all measures and policy reforms that are pavements. Thereafter, deterioration can be swift. necessary for the recovery of their economies and the Routine and preventive maintenance based on careful revitalization of genuine development." monitoring of traffic loads and pavement conditions can 8 A Policy Foundation for Better Roads Good Fair Poor East Africa Paved Roads 50 30 17 Unpaved Roads 37 30 33 West Africa Paved Roads 54 17 29 Unpaved Roads 19 34 47 All SSA Paved Roads 52 25 23 Unpaved Roads 29 32 39 protect and prolong the life of important national improved road conditions. These figures do not account investments in roads. for the costs imposed on agriculture and industry by increased transport costs, lengthened travel times, or the A comparison of costs for preventive maintenance and delayed pace of development. Road maintenance in its rehabilitation illustrates the point. Routine maintenance broadest sense includes repair and rehabilitation to can be done for a cost of US$300 to US$1,500 per restore bad roads to good condition, as well as streng- kilometer per year and periodic maintenance every 3 to thening and rejuvenation to keep sound roads in good 12 years for about US$25,000. When maintenance is state. neglected the eventual cost of rehabilitation or restoration is about US$30,000 per km for unpaved Balancing maintenance requirements against the cons- roads and US$200,000 per km for paved roads. This truction of new roads is a difficult task. Decision- represents a 2.5 to 8 fold increase in expenditures. making should be rationalized by viewing new cons- Also, by failing to redirect spending to maintenance, truction and maintenance as part of a single process 3 to 4 km of potentially good roads are lost for every aimed at minimizing total transport costs in the sector. km of new construction. This requires unifying road budgets so all altematives can be ranked against each other in formulating road The economic consequences of neglecting maintenance programs. National transport ministries and donors alike are primarily borne by road users-in the form of must come to recognize that most major maintenance increased vehicle operating costs. A dollar reduction tasks are designed to protect and extend capital invest- in road maintenance expenditures can result in an ments; they belong, therefore, in the same budget increase of US$2 to US$3 in vehicle operating costs category as the initial outlay for construction. and vice versa. In reality then, reducing expenditures on road maintenance will not serve the intended purpose of Based on their records of road condition, and on past releasing resources for higher priority sectors. Instead experience of their performance, countries in Sub- road users, who are mostly in the private sector, bear Saharan Africa can be placed in four groups. the burden of increased transport costs, and a high portion of these costs require foreign exchange for Group 1: Botswana, Cote d'Ivoire, Djibouti, spare parts, tires and vehicle replacement. Malawi, Niger, Zimbabwe The governments of the region could save some US$1.2 These countries have demonstrated a substantial billion in road expenditures a year (about 0.85% of commitment to road maintenance, and have the ability regional GNP) through preventive maintenance, of to implement their road programs as well as raise or which perhaps US$900 million is foreign exchange. attract adequate resources for the highway sector. These Another US$1.2 billion would accrue to road users countries should have little difficulty in restoring-or through reduced wear and tear on vehicles as a result of preserving-their roads in good condition, in some 9 A Policy Foundation for Better Roads cases, as soon as 1995. They have already shown their roads are to help development, they simply add to the ability and willingness to put sufficient resources into road maintenance burden, which is already difficult to road maintenance; continuation of the same policies, bear. sometimes with additional external funding, will be needed. In the 60% of countries which have shown they can raise enough funds to restore and maintain their Group 2: Benin, Burundi, Central African Republic, essential roads, a redirection of efforts away from new Ethiopia, Lesotho, Mali, Madagascar, Mauritius, works to increase maintenance will be essential to avoid Rwanda, Swaziland, Togo road failures on a large scale. For the remaining 40% of countries (Group 4), even stopping all new works until These countries have shown a growing commitment the year 2000 would still require higher levels of road to road maintenance but have yet to build up adequate financing than they have previously had. Whether these capacity to implement road maintenance programs. countries can plan for and manage larger amounts-and Efforts to improve maintenance look promising, and whether the donors are prepared to provide extra sufficient resources to undertake the needed aid-will depend very much on the organization and maintenance could probably be obtained if spending efficiency of administrations in charge of roads. If they priorities were adjusted accordingly. These countries cannot create the necessary level of institutional should be able to restore their roads to good condition efficiency to manage their entire road network, and if by the end of the century if they can strengthen their there is no prospect to provide the necessary resources, commitment to improve maintenance even though the only solution seems to be to restrict regular mainte- considerable technical and financial assistance will be nance to a core road network that can be managed and needed in some cases. funded within the resources likely to be available. Group 3: Cameroon, Gabon, Kenya, Nigeria, Senegal The Road Maintenance Initiative These countries paid insufficient attention to road The main agenda of this Seminar is to review possible maintenance in the past, despite having the capacity and actions to improve maintenance in the face of funding financial resources to contain the deterioration of their and organizational constraints. A repetition of past roads. These countries have the capacity to restore their trends will result in poorly serviceable road networks roads by the year 2000, and could increase the funds with all the attendant costs and constraints on economic required, but they will not achieve that target unless development. To restore the entire network would be there is a significant change in the priority accorded to beyond the ability of most countries, and may not road maintenance; and always be the best use of resources, given the needs in other sectors. Group 4: Burkina Faso, Chad, Equatorial Guinea, Gambia, Ghana, Guinea, Guinea-Bissau, Liberia, By supporting this seminar, donors have shown their Mauritania, Mozambique, Sierra Leone, Somalia, commitment to road maintenance. For their part, Sudan, Tanzania, Uganda, Zaire, Zambia governments also need to show their commitment to the ideal of better road maintenance by setting in motion These countries have experienced severe problems policy changes that are essential, and even by agreeing in building up institutional capacity and attracting funds to implement these policy initiatives. It would be for road maintenance. Some of their networks are seve- desirable if representatives attending the Seminar: rely deteriorated, and a substantial amount of rehabili- tation will be required. These countries will probably * agree to put in place within the next five years the not be able to restore their networks to good condition policy and institutional changes necessary for by the year 2000 due to their economic climate and the improved maintenance, in particular to revise the size of the backlog of maintenance and rehabilitation. allocation of funds in favor of maintenance and They will have to take difficult decisions concerning rehabilitation; priorities of rehabilitation and maintenance that will best serve their short- and medium-term needs, * plan for restoration of the essential road network to including concentration of maintenance efforts on a good condition by the year 2000. core road network. The maintenance and restoration of Sub-Saharan Afri- A review of what Sub-Saharan Africa has been spend- ca's essential road networks would cost about US$1.15 ing on roads recently shows that some 60% (Groups 1, billion a year over the next twelve years. This is a large 2 and 3) have been spending about 1% of their GNP, at amount of money, but it offers potential national annual least over short periods, which is enough to restore and savings of twice that magnitude; thus for every dollar fully maintain all their essential roads. Desirable as new spent on maintenance, governments would save one 10 A Policy Foundation for Better Roads dollar by avoiding reconstruction costs, and road users Operations and Management would save another dollar in reduced wear and tear on their vehicles. In addition, by carrying out this program Effective and efficient management of operations is of restoration, most of the essential network would be crucial to addressing Sub-Saharan Africa's road dete- in serviceable condition by the year 2000, whereas if rioration problem. More effective management that current trends continue, most of it will have to be produces demonstrable improvements in both the condi- rebuilt at high cost. While this process is complex, tion of roads and the efficient use of resources is also difficult, and requires high levels of commitment and a key to creating the political commitment necessary to cooperation, it can be done! increase attention to-and funding for-maintenance. It can also be a powerful tool for saving money, particularly foreign exchange. Agenda for the Seminar Most road maintenance operations in Sub-Saharan The main policy concerns to be discussed at this Africa are run by large establishments operating by Seminar fall into three broad categories: funding, force account with geographically widespread opera- planning and programming; operation and management; tions that rely heavily on equipment. Maintenance and institutional reform and human resource devel- operations planning and execution often overlap, and opmenL information systems are not adequate for management to track the quantity and quality of performance or assess and prioritize needs. Maintenance managers have Funding, Planning and Programming also been overburdened by the need to keep up huge- and often incompatible-equipment fleets and supervise The reason most often given for low standards of road large and far-flung work forces. Improving information maintenance is that there is a lack of funds, but this is flows and streamlining management tasks are perhaps only true for about half the Sub-Saharan African the two key factors in improving management effi- countries. In the others, past expenditures on road ciency. maintenance and construction could have adequately financed maintenance and road rehabilitation. In some The key recommendations are: countries, although budgeted funds are adequate, they are not released promptly. As a result, work is to increase accountability by improving information interrupted, sometimes for several months. This is one and management systems so maintenance managers reason why budget allocations are underspent although can effectively plan and track performance, and, in the need and means for incurring expenditure may both addition, separate planning and monitoring exist. functions from works execution; This topic deals with ways in which financial resources * to adapt the size of the mechanical equipment fleet can be mobilized and put to use in the most effective to reflect maintenance needs and increase the manner so that scarce funds are used where they are efficiency of equipment use; most needed and can do the most good. The question to be addressed in this topic is: "What system of funding, * to spin off management burdens through increased planning and programming is most likely to bring about use of contractors; and improvements in the road network?" to adopt appropriate technology and using local As we consider this question, three key concerns arise: resources for self-reliance and sustainability. * developing a unified framework for planning and programming public road expenditures over the Institutional Reform and entire network, whether recurrent, capital, or aid Human Resources Development financed; Institutional and human resources development has been * funding and budgeting procedures that ensure that one of the most difficult areas in terms of making funds are available when required, and that they permanent improvements. It has been difficult to respond to changing circumstances; and, establish self-sustaining institutions that can manage road maintenance efficiently or use external resources * planning and programming methods that foster effectively. Institutional problems with road accountability, in particular by programming maintenance arise because of the inherent managerial maintenance based on road conditions and measu- complexity, and the geographical dispersion of rable physical outputs. maintenance operations that require a territorial 11 A Policy Foundation for Better Roads organization. Institutional progress has been slow long- and reviewed in a number of technical papers to act as standing despite training and institutional development. a background for our discussions. After the work groups have done their work and decided on relevant Road maintenance has been only one of many claimants policy concerns, important decisions will need to be on the region's overstressed education and training made concerning the key issues discussed here-or facilities. Specialized personnel remain in woefully others that you may deem important. While it is short supply. It is generally agreed that a minimum of recognized that external support will be needed to help about 30 graduate level engineers and scientists per achieve many of the actions expected to result from 10,000 people are needed to service a modem economy. these seminars, it is the national governments that must In most Sub-Saharan African countries, the proportion make the vital policy decisions to support action plans is less than a third of this number. aimed at: There are many issues here, but they may be summed restoring of the essential road network by the end up under two main headings: of the century; and - institutional reform to increase the efficiency of implementing the necessary institutional reforms road maintenance and rehabilitation; and and procedural changes within five years. * better management of human resources through The donors can only do so much. Without a long-term motivation, adequate incentives, and efforts to commitment by governments to the necessary reforms, develop a stronger and more competent workforce. real progress is unlikely. Our schedule here calls for two days of plenary and work group discussions on the Conclusion three major topics of the meeting, and a third day in which each country team will prepare action plans for This seminar has been arranged as a forum where the implementing these concepts to support their own long-standing and serious problem of inadequate road national road maintenance and rehabilitation efforts. maintenance in Sub-Saharan Africa can be discussed, These efforts should serve as a good beginning towards important policy decisions taken, and future actions the goals of improving road maintenance and road agreed on. The principal issues have been examined conditions throughout Sub-Saharan Africa. 12 Melody Mason and Sydney Thriscutt Road Deterioration in Sub-Saharan Africa Introduction and Summary Two accidents of timing have amplified this problem. The pace of road building peaked in the early 1960s Road networks across Sub-Saharan Africa have deterio- and 1970s, creating thousands of kilometers of high- rated to the point that the resources and skills to repair ways that are now reaching the end of their design life and maintain them are simply not available. Instead, at the same time. The turndown in regional economic regional countries face a range of second-best choices. growth has meant that this increased need for road They must choose which roads to rehabilitate, and rehabilitation and replacement has coincided with a which to maintain-and at what level. They must make stringent reduction in the financial resources needed for difficult and often mutually exclusive trade-offs the task. between constructing new roads and preserving existing investments. Now the choices are difficult. It is clear that attention must be turned strongly away from road-building and The donor community, which is at least partially toward the re-establishment and protection of the exist- complicit in the creation of the present situation, has an ing capital base. But even that task is large-and obligation to support national administrations in making requires a significant level of political, financial, and and carrying out these choices. Setting a cooperative institutional commitment that will be difficult to muster agenda to consolidate and begin improving the region's and sustain. In many cases it will be beyond immediate key transport facility-its road network-will be a national capabilities and resources, and the slow process difficult and challenging process. of building those capabilities will require a painful process of adjustment, in effect a short- to medium- The roots of the roads problem are historical. In the term reduction in national road mileage. immediate post-colonial era road building was given far higher priority than institution building-and road Here are the facts, based upon a study of the data avail- maintenance was given even less attention. New nation- able for 41 regional countries: al roads administrations woefully short of trained personnel and managers were given road-building and Neglected maintenance has left half of Sub-Saharan maintenance portfolios that would have daunted much Africa's paved roads in only poor to fair condition. stronger institutions. Their assignment was rightly seen More than 70% of the unpaved roads are in the as one of the most important for rapid economic devel- same situation. Many of these roads are in immi- opment: creating the transport links that would tie new nent danger of being lost as usable thoroughfares. nations together in economic and political unity. Some can be saved if quick action is taken. Delays will mean that more and more of them will have to Foreign donors recognized the priority of transport and be either abandoned or completely rebuilt at costs provided large amounts of assistance to create new that can range well above US$200,000 per kilo- roads. They spent much less effort on helping to create meter. the institutional and financial systems needed to protect these investments. The result was a burden of road * Financial resources desperately needed for mainte- maintenance that increased much more quickly than nance continue to be channeled, instead, into new national abilities to bear it. construction. Data from 23 countries show them spending an annual average of 1.1% of GNP on roads. This would have been roughly enough to maintain national roads already in good condition Melody Mason and restore a sizeable portion of those whose condi- and tion has fallen to fair-had not almost 60% of these Sydney Thriscutt funds been spent instead on building new roads. are consultants to the World Bank * Despite these figures, money is not the key issue. A number of extremely poor countries with few The paper was edited and adapted by the SSATP resources to devote to the roads sector have much from an original text submitted by the authors better records in maintaining their existing road stock than countries with much higher per capita 0 1989, SSATP - World Bank/ECA and national incomes. In part, this reflects relatively smaller road networks. The main factor, however, 13 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa seems to be their realization of the economic this will involve making a difficult initial choice as to importance of preserving existing assets, and a firm which roads are economically worthy of maintenance political commitment to maintenance that includes and rehabilitation-a process of triage that recognizes a willingness to forego often prestigious new road that the only practical choices for many countries may projects. be to maintain and retain only a core network of essential roads. Fundamental systemic changes-often starting at the highest political levels-are needed to stem the Applying this standard across the region suggests that rapid wasting away and disappearance of the its network of economic roads could be maintained, region's road assets. Attitudes, institutions, and including necessary rehabilitation, for approximately mechanisms will all have to be changed. The pro- US$1.15 billion a year. This represents 0.8% of regional cess will be difficult, costly, and slow. Donor GNP, an amount not at all inconsistent-if the agencies will have to change their approaches as imbalance between maintenance and new building is well. They must be both more realistic and commit- redressed-with present estimated expenditures of ted to more consistent and longer term efforts. They US$1.54 billion a year (1.1% of GNP). must show more cooperation and coordination, and less rivalry. They must be more supportive, more It should be borne in mind, however, what such a sensitive to African approaches and realities, and choice entails. The proportion of roads resources less prescriptive. devoted to new construction will have to be greatly reduced, usually to 20% or less of total expenditures. A significant number of roads will have to be put on an Even given all of the above, the choices are not attrac- absolutely minimal maintenance regime, or abandoned tive. Limitations on resources and absorptive capacities entirely. Institutional changes, many of them difficult severely limit how much can be done, and how quickly. and some requiring significant investment, will have to The changes that are needed will, in themselves, divert be undertaken. Basic decisions on such issues as the time and energies from road work itself. relative roles of the public and private sectors and the uses of labor and equipment intensive methods will The World Bank has considered four scenarios for have to be taken. assessing the road maintenance and rehabilitation problem in Sub-Saharan Africa: Condition of Road Networks 1. Limit efforts to routine maintenance of priority roads. This would cost an estimated US$228 An assessment has been made of current road condi- million a year, and raise the proportion of paved tions in SSA countries based on data available for 41 roads in poor condition in the year 2000 to 78% countries.' Nearly one-quarter of paved roads are in in East Africa and 91% in West Africa. No poor condition and a further quarter in fair condition unpaved roads would remain in good condition. (see Glossary for definition). The situation is even more This is clearly not an acceptable scenario. serious for unpaved roads where about 39% of roads are in poor condition and an additional 32% in fair 2. Fully maintain those roads now in good condition condition. Table 1 gives a regional breakdown and and apply minimum maintenance standards to the compares the 1988 data with that for 1984 (shown in remainder of the network. This would cost US$409 parentheses). Road conditions have been defined accor- million a year. By the year 2000, this would bring ding to the extent of maintenance and repair work that 50% of the East African-and 46% of West needs to be carried out to restore roads to good condi- African road networks to at least fair condition. tion. The remedial actions required are usually a func- This would cost $409 million a year. tion of both road condition and traffic. However, in Sub-Saharan Africa, only a small percentage of the 3. Fully maintaining good roads and restoring failing main road networks have an AADT of more than 500 roads. This would cost US$680 million a year vehicles per day, so that linking remedial action and through the year 2000. costs directly to road conditions implies less error than would be the case on more heavily trafficked networks 4. Restore the entire network to good condition by the in the region in other regions. Paved roads in fair year 2000. This would cost an estimated US$1.8 condition are assumed to require resurfacing and select- billion a year, and is clearly an unaffordable ive repairs while those in poor condition are assumed to scenario. require reconstruction. Each country must choose its own path to adequate Given the unreliability of the data, it cannot be said road maintenance, based on its priorities, the extent of that the changes indicated are significant. In West its problems, and its available resources. In most cases Africa, there seems not to have been any deterioration 14 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa or improvement in the average road conditions between highlight the need for systematic road condition 1984 and 1988. In East Africa, there appears to have inventories in all countries so as to allow monitoring of been a real improvement in the condition of paved the effectiveness of road maintenance programs and the roads. Some countries have reported extensive changes subsequent accountability of road maintenance agencies. in road conditions over the past four years. While this may be credible for small networks, several of the improvements reported in the larger networks imply an As in the 1984 survey, road conditions vary widely amount of maintenance and rehabilitation within four between countries, with the proportions of good, fair years that has not actually occurred. This highlights a and poor respectively ranging from 94%, 4% and 2% as major difficulty in assessing road conditions in that reported for one country, to 0%, 10% and 90% in results are very subjective unless a fully developed road another (See Table 2 for data on individual countries). management system is in place. Several countries have Nearly 30% of countries have less than one-third of begun the process and others have had inventories on their paved road networks in good condition, indicating road conditions carried out by consultants. the extent to which maintenance has been neglected. Consequently, the 1988 data may be based on more The situation with respect to unpaved roads is even reliable data for a few more countries than the 1984 worse; about 80% of countries have less than one-third survey data. The problems with the condition studies of the networks in good condition. TABLE 1 ROAD CONDITIONS IN SUB-SAHARAN AFRICA (1984) Good Fair Poor East Africa Paved Roads 50(42) 33(32) 17(26) Unpaved Roads 28(42) 30(30) 42(28) West Africa Paved Roads 54(52) 17(23) 29(25) Unpaved Roads 19(20) 34(36) 47(44) All Sub-Saharan Africa Paved Roads 52(47) 25(27) 23(26) Unpaved Roads 29(33) 32(32) 39(35) Road Deterioration Study. Weighted averages according to length of network have been used throughout. 15 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa TABLE 2 ROAD NETWORKS BY COUNTRY ------- GNP- --------- Main --- MAIN PAVED NETWORK -- - MAIN UNPAVED NETWORK - - 1987 Av growth 1987 Network Paved Condition of Roads Unpaved Condition of Roads COUNTRY GNP per rate GNP total Length Length ------------------ Length ------------------ capita 1980-87 GNP Good Pair Poor Good Pair Poor (US$) (%) (USS m.) (ka) (ka) (%) (%) (%) (km) (%) (%) (%) EASTERN AND (* denotes 1984 data) SOUTHERN AFRICA ETHIOPIA 120 -1.6 5,537 17,909 4,064 47 42 11 13,414 47 31 22 MOZNMIQUE 150 -9.5 2,135 13660 5,113 12 75 13 1,700 6 44 50 ZAIRE 160 -2.8 5,287 40,900 2,400 38 23 39 18,300 44 29 27 MALAWI 160 -0.3 1,223 13,500 2,210 61 26 13 3,567 30 35 35 * MADAGASCAR 200 -4.0 2,172 14,700 5.000 56 28 16 3,700 27 30 43 TANZANIA 220 -1.8 5,202 10,456 3,353 51 19 30 7,103 17 29 54 ZAMBIA 240 -4.4 1,696 20,653 5,500 40 30 30 * 15,151 30 35 35 * BURUNDI 240 -0.4 1,205 3,014 895 58 25 17 2,119 20 57 23 UGANDA 260 -2.4 4,086 6,165 1,800 10 63 27 4,366 0 73 27 SOMALIA 290 0.8 1,656 7,409 2,757 52 33 15 4,772 4 10 86 RWANDA 310 -3.1 2,008 4,060 960 41 41 18 3,200 19 46 35 SUDAN 330 -4.0 7,646 8,184 2,335 27 43 30 5,849 20 20 60 * KENYA 340 -1.3 7,500 51,033 6,275 32 52 16 * 16,373 66 17 17 * LESOTHO 360 0.1 591 2,591 604 56 29 15 1,544 16 57 27 DJIBOUTI 360 * NA 129 1,132 412 51 38 11 720 51 38 11 COMOROS 380 0.1 160 735 470 43 53 4 265 25 38 37 ZIMBABWE 590 -1.5 5,265 18,393 5,626 70 27 3 4,276 40 30 30 SWAZILAND 700 1.3 496 2,757 689 35 35 30 2,068 60 37 3 BOTSWANA 1,030 9.0 1,175 7,938 2,131 94 4 2 5,807 45 19 36 MAURITIUS 1,470 4.4 1,524 1,800 1,610 95 5 0 200 Total/Average 396 56,693 246,989 54,104 50 33 17 114,494 28 30 42 WESTERN AFRICA CHAD 150 2.5 805 7,300 300 0 10 90 3,500 0 0 100 GUINEA-BISSAU 170 -2.8 152 2,636 544 39 26 35 2,092 6 6 88 BURKINA 170 -0.6 1,426 13,070 1,503 24 49 27 4,139 0 80 20 EQUAT. GUINEA 180 * NA 67 1,090 447 27 50 23 762 30 42 28 MALI 200 0.0 1,576 12,300 2,464 63 31 6 6,320 19 13 68 THE GAMBIA 220 -4.0 177 1,210 450 22 46 32 760 32 39 29 NIGER 280 -5.3 1,898 6,696 2,768 60 23 17 3,646 24 29 47 SIERRA LEONE 300 -2.5 1,172 10,167 1,244 62 9 29 6,984 8 37 55 TOGO 300 -3.5 963 2,819 1,500 40 22 38 713 20 10 70 BENIN 300 -0.6 1.315 3,434 1,038 26 50 24 2,346 11 35 54 C.A.R. 330 -0.5 912 5,250 442 36 35 29 * 4,808 68 16 16 * GUINEA 330 * NA 1,947 10,609 1,289 50 0 50 4,320 0 0 100 NIGERIA 370 -5.0 39,533 29,500 22,760 67 5 28 8,036 0 10 90 GHANA 390 -2.0 5,328 13,611 5,458 28 21 51 8,153 32 36 32 LIBERIA 440 -5.2 1,030 3,945 557 85 13 2 * 3,388 15 75 10 * MAURITANIA 440 -1.5 616 7,100 1,630 50 39 11 765 0 5 95 SENEGAL 510 0.1 3,545 10,000 3,809 28 32 40 7,470 7 21 72 IVORY COAST 750 -3.0 8,262 14,190 3,976 75 25 0 10,078 34 65 1 CONGO 880 0.3 1,761 10,800 1,245 50 12 38 5,000 38 27 35 CAMEROON 960 4.2 10,441 32,670 2,928 38 27 35 10,660 16 57 27 GABON 2,750 -3.5 2,890 5,239 581 30 30 40 4,658 32 30 38 Total/Average 496 86,016 203,634 56,933 54 17 9 98,598 19 34 47 Past Maintenance Performance activity has increased slightly-for a similar number of countries about 5% of the paved and 6% of the Implications for Future Road Conditions unpaved networks received some kind of periodic maintenance or reconstruction in 1987-88. However, The West and Central African survey carried out in insufficient work was carried to prevent further 1981-82 found that very little maintenance activity was deterioration of networks since only 3.5% of paved and carried out on road networks in the 16 countries unpaved roads received either periodic maintenance or included in the study. Only 4% of paved roads were strengthening compared to the required 5.5% for the either resealed, strengthened or reconstructed each year paved roads and 6.5% for unpaved roads. Only six and 3% of gravel roads were regraveled or rehabilitated. countries out of 18 carried out work on more than 5% The findings of the 1988 study indicate that the level of of their paved and unpaved network. Consequently, if 16 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa the above findings for 18 countries are indicative of maintenance has been inadequate. Data for 23 countries what is happening in the remaining Sub-Saharan Africa indicate that an average of just over 1.1% of GNP countries, road networks will deteriorate even further (excluding Cameroon with nearly 3% of GNP) has been unless the present level of maintenance is increased. spent on all roads (main and feeder) in the last year or two, as can be seen in Table 3. The same percentage Based on this assumption, the percent of paved roads in was found in the 1984 Road Deterioration Policy Study. good condition would decline from 50% to 38% by the On average, (based on data for 19 countries) it is year 2000, and the percent of roads in poor condition estimated that 58% of roads expenditure was devoted to would increase from 23% to 40%. However, these new construction or improvement, 25% to routine and figures represent the average for the whole region; the periodic maintenance, and the remaining 17% to repercussions of continuing low levels of maintenance reconstruction or rehabilitation. The situation is similar for some countries will be far worse. For example, six to that found in the West and Central Africa survey countries did not carry out any resealing between 1984 where an average of 66% was spent on new and 1988, which means that for these countries, there construction, 20% on maintenance and 13% on rehabi- would be very few roads in good condition by the year litation and reconstruction for 1981-82. With road 2000 at present maintenance levels. This situation is networks in the condition they are in the region, an perhaps not as serious as it appears for some lower appropriate division of roads expenditure overall given income countries where reconstruction or high levels of the limitation of resources, would be about 20% of the maintenance would not be justified on many of the total for routine maintenance, up to 45% for periodic deteriorated roads because of low traffic levels. maintenance, 15% for rehabilitation, and no more than Nevertheless, even after excluding low volume roads 20% for new work and improvement. the study data indicates that over half of the countries Obviously, the economic balance of resources between surveyed are still not carrying out sufficient levels of maintenance and new construction varies from one maintenance to prevent further deterioration, even on country to another. For example, both Cote d'Ivoire and high economic priority roads. Botswana have spent a high proportion of their road budgets on new construction, but the level of maintenance has been quite adequate. The problem is Adequacy of Maintenance Funds with those countries that have spent more than 50% of their road budgets (including aid) on new construction Chronic shortage of funds allocated to road mainte- while maintenance of the roads currently in good to fair nance is the most usual reason given for the poor condition has not been adequate and/or roads in poor condition of road networks. However, analysis of the condition have not been rehabilitated or resurfaced (see resources devoted to road construction, road Box "Nigeria's New Roads and the Risk of Massive improvement and road maintenance reveal that, in spite Deterioration"). It is estimated that 50% of countries for of best intentions frequently expressed, some countries which sufficient information is available (28 countries) have been spending funds on new roads while fall in this category.2 Nigeria's New Roads and the Risk of Massive Deterioration About 60% of the Nigerian paved Federal Trunk Road System (23,000 In) was rebuilt between 1975 and 1985. Over that time, there was a very large economic expansion following the 1973-74 rise in oil prices, and traffic flow increases of between 15% and 35% annually were not uncommon on the main road network. Despite the expansion and improvement of the Nigerian paved road system at a cost of about US$8 billion, and its apparently satisfactory condition (67% Good, 5% Fair and 28% Poor in 1988), the situation is still precarious. The design standards used encouraged generous geometric features but weak pavements, so that substantial strengthening is required within a few years to avoid rapid deterioration. The costs of this would be about US$150-200 million a year, plus generally improved maintenance. With the fall in oil revenues, it will be difficult to find this amount of money, and if there are no funds, the trunk road system may deteriorate rapidly, requiring massive rehabilitation and reconstruction work within the next five to ten years. 17 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa TABLE 3 EXPENDITURES ON HIGHWAYS (average 1986-88, in 1988 prices) CURRENT EIPENDITURES CAPITAL EXPENDITURES TOTAL Total Total ---- ---------------------------- ROADS Expend. Maintn 1987 Av growth 1987 Routine Periodic Total Construe.Rehabil- Total EXPEND- as Expend COUNTRY GNP per rate GNP total Maince Maince Mainee and itation Capital ITURE Percent as % capita 1980-87 GNP Upgrading of GNP of GNP (US$) (%) (US$ M ) ------------------ (US$'000s) ----------------- EASTERN AND (* denotes 1984 data) SOUTHERN AFRICA ETHIOPIA 120 -1.6 5,537 15,450 2,565 18,015 40,000 5,750 45,750 63,765 1.15% 0.43% MDZAMBIQUE 10 -9.5 2,135 ZAIRE 160 -2.8 5,287 MALAWI 160 *0.3 1,223 4,750 8,850 7,435 16,285 21,035 1.72% 1.00% MADAGASCAR 200 -4.0 2,172 2,000 31,420 1.45% TANZANIA 220 -1.8 5,202 3,660 392 4,052 14,470 3,160 17,630 21,682 0.42% 0.14% ZAMBIA 240 -4.4 1,696 2,733 14,016 18,749 1.11% BURUNDI 240 -0.4 1,205 3,208 170 3,378 16,768 518 17,286 20,664 1.71% 0.32% UGANDA 260 -2.4 4,086 4,100 1,500 5,600 0.14% S0OMALIA 290 0.8 1,656 360 0 360 0 0.00% RWANDA 310 -3.1 2,009 5,980 2,362 8,342 16,580 12:710 29,270 37,612 1.87% 1.05% SUDAN 330 -4.0 7,646 1,110 1,220 2,330 33,000 2,220 35,220 37,550 0.49% 0.04% KENYA 340 -1.3 7,500 18,400 6,200 24,600 59,900 84,500 1.13% LESTO 360 0.1 591 2,300 1,240 3,540 6,430 5,285 11,715 15,255 2.58% 1.49% DJIBOUTI 360 * NA 129 1,949 9,039 0 9,039 10,988 8.52% 1.51% CDMOROS 380 0,1 160 1,350 600 1,950 1,230 580 1,810 3,760 2.35% 1.58% ZIMBABWE 590 -1.0 5,265 7,185 5,150 12,335 36,600 1,080 37,680 50,015 0.95% 0.25% SWAZILAND 700 1.3 496 2,850 0 8,810 8,810 11,460 2.35% 2.35% BOTSWANA 1,030 9.0 1,175 1,990 5,025 7,015 19,840 0 19,840 26,855 2.29% 0.60% MAURITIUS 1,470 4.4 1,524 3,500 WESTERN AFRICA CHAD 150 2.5 805 2,860 2,860 8,300 GUINEA-BIS8AU 170 -2.8 152 550 0 50 BURKINA 170 -0.6 1,426 2,000 2,000 EQUAT. GUINEA 180 * NA 67 MALI 200 0.0 1,576 3,800 0 3,800 26,100 11,900 38,000 41,800 2.65% 1.00% THE GAMBIA 220 -4.0 177 532 414 946 7,488 0 7,488 -,434 4.76% 0.53% NIGER 280 -5.3 1,898 &,480 1,560 6,040 17,190 9,000 26,190 32,230 1.70% 0.79% SIERRA LEONE 300 -2.5 1,172 TOGO 300 -3.5 943 2,430 8,080 8,510 7,640 12,100 19,740 28,250 2.93% 2.14% RENIN 300 -0.6 1,315 5,620 7,180 12,800 C.A.R. 330 -0.5 912 GUINEA 330 * NA 1,947 2,100 0 2,100 0 13,000 13,000 15,100 0.78% 0.78% NIGERIA 370 -5.0 39,533 55,000 0 55,000 78,715 78,715 133,715 0.33% GHANA 390 -2.0 5,328 5,000 5,148 11,148 0 20,000 20,000 31,148 0.58% 0.58% LIBERIA 440 -5.2 1,030 MAURITANIA 440 -1.5 816 1,400 SENEGAL 510 0.1 3,545 8,000 25,330 33,330 0.94% IVORY COAST 750 -3.0 8,262 21,087 26,960 48,047 CONGO 880 0.3 1,761 6,660 25,800 1.85% CAMEROON 960 4.2 10,441 42,000 263,000 305,000 2.92% GABON 2,750 -3.5 2,890 5,290 3,390 5,930 9,320 14,610 0.51% 0.39% Estimated Total Road Expenditures in Sub-Saharan Africa: USS154 billion (1.1% of GNP) Only 20% of countries have spent more than 50% of is receiving about the correct proportion of funds. This total road budgets on new construction and have still is not necessarily true. One of the major problems managed to carry out a reasonable level of maintenance. affecting the cost of road maintenance is the large and For more than two-thids of the countries, expenditures often unproductive labor forces attached to roads on periodic resurfacing (surface dressing/seal coats) organizations that are basically not labor intensive. This have been too low. These concerns were raised at the has come about because road maintenance is used as a Donors' Meeting for Roads Aid in Africa, held in means of reducing rural underemployment and introdu- London in 1985'. cing cash into subsistence economies. It is not unusual to find that two-thirds or more of the road maintenance allocation is spent on wages for labor, which is both Staffing redundant and permanent. While one cannot disagree with the objective of improving the lot of the rural Comparison with the present pattern of road expen- poor, at the same time it must be realized that a roads diture could lead one to think that routine maintenance authority run primarily as a social welfare organization 18 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa cannot be expected to follow the precepts of sound Bank Experience technical management (see box "Overstaffing in Kenya"). The World Bank's experience shows that there seems to have been some progress in road maintenance Of the 17 countries for which some data was available operations in just over half of the Sub-Saharan Africa on the number of road maintenance staff and their cost, countries where there has been Bank support for the six are spending more than half of their force account roads subsector for 15 years or more. Nevertheless, maintenance expenditures on staff, including three considerable effort has to be made to develop which spend more than two-thirds. This proportion maintenance organizations to the point where they can would be high even for a fully labor-intensive manage their road networks competently; most will organization, which these are not. The average require technical assistance for at least the next five to percentage of expenditure on staff is about 45% which ten years. Unfortunately, little progress has been made compares with 30% found in the 1981-82 survey of with road maintenance in the other half of the Sub- West and Central Africa, although the two figures are Saharan Africa countries where the Bank has been not strictly comparable because the countries are not the operational. This finding is supported by a study of same in the two studies. On average, maintenance staff maintenance components of 16 completed projects maintain 3 km of road per person, which is quite low financed by the World Bank' showing that nine considering that labor-intensive methods are not used projects were not successful in meeting their objectives extensively in the region. Excessive staffing is a major and that only one project was completely successful. problem in some countries, including Kenya, Burundi, Nearly all projects suffered from either a lack of local Sierra Leone, and The Gambia. funds or problems with the timely release of funds. Overstaffing in Kenya In Kenya, funds for road maintenance have consistently been below requirements. The squeeze on road funding was made worse by apparently unconnected developments: the increase in the government's permanent establishment, and the District Focus policy. Until 1982, the roads department had employed about 1,000 permanent staff and some 9,500 casual labor. Wages for this number amounted to about 39% of the total recurrent budget (KL 6.7 million out of KL 17.3 million). After other payments, about KL 9.7 million was available for works, which was already inadequate. Three years later, the number of established posts in the roads department had increased from 1,000 to 14,600. Casual labor had been placed on the permanent establishment, and as part of the District Focus, other ministry personnel at the local level had been brought into the roads department. More than 94% of this staff came under District control, and 55% of the roads department's budget was handed over to the Districts, who spent more than 90% of this on wages, leaving very little for work. As a result, funds for work controlled by the roads department headquarters were reduced to KL 6.3 million by 1986, about two thirds of the inadequate amount they had three years earlier. In a move to capture funds for trunk road maintenance, a toll road scheme was introduced with revenue from tolls earmarked for the periodic maintenance improvement of trunk roads. After some initial problems, a modest, but reliable, source of funds for the roads department, which are not subject to unexpected reductions, was provided. 19 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa Apart from the lack of funds, the main problem areas Sub-Saharan Africa has shown that resealing has been are the lack of qualified and experienced engineers and carried out by contract in many countries for some technical and supervisory personnel, poor maintenance time, but there is no apparent correlation between of equipment fleets, lengthy procurement procedures, resealing by contract and the adequacy or the volume of weak or inefficient administrative and organizational resealing carried out. Nevertheless, given the general structures, diversion of maintenance resources to other failure of force account to operate efficiently in Sub- activities, low salary levels resulting in poor motivation Saharan Africa, contract maintenance, with intensive of staff, lack of accountability (both internal and efforts to make it effective, may provide the best hope external), and poor planning and monitoring of mainte- to achieve maintenance targets for many countries. nance activities. There have been two major reasons why contract main- Previous attempts to determine whether there are any tenance has sometimes failed. The first is the lack of lessons that can be drawn from the experience of local counterpart funds and the second is procurement countries where maintenance: has shown improvement procedures that present obstacles, and are sometimes suggest that the only common factor is real insurmountable, at every stage of the tendering process. commitment and support for road maintenance at the The first problem goes hand-in-hand with commitment highest levels of government. The key to effective to maintenance and careful planning of financing maintenance capacity is to convince those at the highest sources during the preparation stage of maintenance political and technical levels of the benefits of road projects. The second problem has evolved because maintenance and to institutionalize such commitment so procurement procedures have developed in an ad hoc that progress made with developing maintenance manner, with regulations dating back to colonial times agencies is not lost with the removal of key people. An mixed in with a labyrinth of new regulations designed encouraging fact is the large number of countries to prevent abuses of the tendering system. The result is expressing interest in road maintenance and that the tendering process takes an inordinately long reconstruction and are either implementing, or are in the time and that all decision-making is centralized, hence process of preparing, intensive maintenance programs. maintenance engineers at the field level have no The Bank expects a far higher rate of success than in authority to let or change contracts. There needs to be the past given the large quantum of resources devoted a complete overhaul and rationalization of procurement to preparation of such programs and the large amount systems to adapt them to the requirements of road of maintenance and rehabilitation works to be maintenance if contract maintenance is to succeed. undertaken by contract. Nevertheless, if such programs are to be successfully implemented they require Kenya is one example of a country that has undertaken intensive monitoring of project activities by the considerable maintenance work by contract. It had tried maintenance agencies themselves, with support from to develop regraveling and resealing force account units external donors. All too often the necessary resources for many years but productivity remained low partly are not available to do this, which considerably because of the lack of funds allocated for inputs other diminishes the impact of contract maintenance than labor, difficulties in procuring inputs such as activities. bitumen, and the low level of equipment availability. The move to contracting started more than 15 years ago when local regraveling contractors were developed and Contract Maintenance today they carry out most of the regraveling activities. More recently, resealing operations have been carried In the past, maintenance activities were mostly carried out by contract with considerable success, and probably out by force account, but many of these activities could at no higher cost than force account operations, taking be carried out by contract, external or local, depending into account all the hidden costs. Unfortunately, Kenya on local contracting capacity. In view of the failure of has been unable to maximize all the benefits of contract repeated attempts to develop force account operations, maintenance since it has not reduced its labor force. many countries are now turning to contract maintenance The result has been that labor accounts for 70% of and trying to develop local contracting capabilities. maintenance force account expenditures, and can often Routine maintenance can either be contracted out by not be utilized because of lack of equipment and other adapting the lengthman system, that is, by assigning up essential inputs. to five kilometers of road to those residing alongside it (as in Kenya, Rwanda and Ghana) or contracting out tasks to local community groups (Gambia). The expe- GNP and Adequacy of Maintenance rience so far is not sufficient to draw conclusions about the effectiveness of contract maintenance, although The tenuous connection between the wealth of a coun- experience in some countries, such as Kenya, is encou- try (in terms of per capita GNP) and the condition of its raging. Contract maintenance is certainly not a panacea roads expressed as a proportion of the paved network for all problems. A review of maintenance activities in in good condition, is shown in Figure 1. 20 Melody Mason & Sydney Thriscutt: Road Deteriortion in Sub-Saharan Afica Figure 1: Road Condition Versus GNP per Capita 80 IVO o 70 a II NIA P M ! SIE o 60 _MA1_ NAft 0 MA BUR .ES 0TAN _____,_n 8 so TA- GU I- -MAU-- -CON ETGH C S40 -BIS-___ - - -CA ZAI SWACAM 0Z SWA oEOUGH SE & BUR GMBEN SUI) 20 __ __ __ 10 ____ --UGA-- 0 LIHA - L_I 0.1 0.3 0.5 0.7 0.9 GNP per Capita (000 US$ 1987) Although there is a slight upward trend in road expense of road maintenance. In some cases, low condition with increasing a per capita GNP, there are expenditure on the roads subsector as a whole can be obviously many other factors in play apart from the explained by extreme priority given to some other mere availability of funds. If Sub-Saharan Africa sector. countries are placed in four groups, according to whether they are above or below the mean road condi- The success of some low-income countries in maintain- tion line, and according to whether they have a GNP ing their road networks demonstrates that low income per capita of more or less than US$500 a year, we can need not be an insurmountable obstacle to maintaining see the comparatively good maintenance performance of roads. This is not to deny that such countries may have some low-income countries (in terms of the percent of more difficulties because of the lack of local funds and their paved roads in good condition) compared with other resources, such as skilled manpower. But if some of the high-income countries. Excluding those governments are truly committed to developing road countries where the network is still relatively new maintenance capacity, even funding and other resource (Burundi and Nigeria), Niger and Malawi stand out as problems can be eventually overcome because of the low-income countries that have managed to keep a high motivation of those involved. relatively high percent of their paved roads in good condition. Madagascar also has an above average per- cent of roads in good condition because of the great strides it has made recently in restoring its network Road Maintenance Requirements after allowing it to deteriorate for many years. On the other hand, some countries with double or more the The 1984 Road Deterioration Policy Study found that income of the above countries have well below the for the high priority network in Sub-Saharan Africa, average percent of roads in good condition (Senegal, US$5.0 billion was required to restore the backlog of Swaziland, Cameroon and Gabon), mainly because paved and unpaved roads in poor condition to an emphasis has been put on new construction at the adequate standard, and an additional US$0.7 billion a 21 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa year over the period 1986-90 to stabilize the current resealing at about one-twelfth the cost of rebuilding a situation, i.e., to ensure that roads in good and fair failed road in poor condition (US$210,000/km), it condition would not deteriorate further. Using exactly appears to make economic sense where resources are the same methodology but updated data on road condi- limited to preserve the maximum length of good roads tion and unit costs, the amount required in 1988 for rather than tackle those that have already deteriorated, restoration of roads in poor condition is approximately provided such a strategy is justified by the level of the same as in 1984 but a higher amount, US$1.2 bil- traffic on the road. In practice, it is not easy to adhere lion, is required to stabilize the remainder of the to this strategy, since public and political pressure network, mainly because of higher unit costs. is always to restore the obviously failed roads, rather than preserve those that still appear to be in usable condition. Maintenance Strategies 3. Maintain Good Roads and Restore An estimate has also been made of the cost of fully those in Fair Condition restoring the high priority road network to satisfactory condition by the year 2000. This would involve the If more resources are available than required for reconstruction of roads in poor condition, strengthening Strategy (2), the next stage is to prevent roads in fair and the resurfacing of paved roads, the rehabilitation of condition from deteriorating by strengthening and unpaved roads in fair condition and routine and periodic repairing them at an estimated cost of US$93,000/km, maintenance of all roads in good condition. The esti- rather than allowing them to fail, so that the per km mated cost only refers to the existing road network and cost to restore them is doubled. This strategy leaves the it is assumed that new roads built between 1989-2000 backlog of failed roads untouched, and again there will will not significantly affect maintenance requirements. be pressure to restore these. Given the financial and implementation problems that may affect the rate at which maintenance programs can 4. Restore the network to Good Condition be carried out in different countries, four different maintenance strategies have been considered, based on This strategy involves preservation of the good economic priorities. Assuming there are no large varia- roads, resurfacing of fair roads, and rehabilitation of tions in traffic, preventive maintenance (including the poor roads over a number of years. In view of the periodic resurfacing and strengthening) generally has a time required to plan a program of this nature, it is higher economic return than reconstruction, mainly considered unrealistic to expect that an elimination of because of the cost savings from not having to the entire Sub-Saharan Africa road restoration backlog reconstruct deteriorated roads at a later date. Therefore, could be accomplished before the year 2000. if there are insufficient resources to maintain and restore all economically viable roads, emphasis should be put on the preventive maintenance of roads currently Maintenance Requirements and Cost Estimates in good or fair condition. Obviously, this would not apply in all cases, but given that it is not possible to Costs have been estimated for the four strategies for the estimate a strategy for each country, the following four high priority road network (the basis for the cost esti- strategies present a generalized approach, assuming the mates is given in Annex 2). Not all of the classified level of traffic generally found in Sub-Saharan Africa: main road networks in poor condition in Sub-Saharan Africa will be economically justified for rehabilitation, 1. Base Case: Routine and Emergency Maintenance due to low traffic volumes. In the past, the construction or upgrading of some roads in Africa was either not This corresponds to what would probably take place based on any economic evaluation or was based on in a number of countries if there were no change in optimistic assumptions about traffic growth that have government policies and very little aid for maintenance. not materialized. Consequently, efforts in several Roads would be maintained at current low levels or countries are now concentrated on the upkeep of an significantly reduced levels. Labor forces for routine "essential priority network", with the tacit implication maintenance would stay in place, and activities would that roads outside this network are to be minimally continue on a largely unplanned basis and in response maintained or abandoned, at least for the present, to obvious failure as and when it occurs, in order to because it is not economic to restore them. Countries keep traffic moving on major routes. currently implementing this strategy include Ghana, Uganda, Chad, Congo, Zaire, Madagascar and Guinea. 2. Roads now in Good condition are Other countries which will have to concentrate resour- maintained correctly ces on a reduced, high priority network because of low traffic volumes (or limited implementation capacity) Since by proper attention, those paved roads now in include Tanzania, Senegal, Burkina Faso, Mozambique, good condition can be kept in that state with periodic Zambia, Sudan and Liberia. 22 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa To take account of the fact that it will not be economic (2) the percentage of paved roads in poor condition in for all classified roads to be restored to good condition, the year 2000 would be reduced to 50% in East Africa the full program of preventive maintenance and rehabi- and 46% in West Africa. Strategy (3) would stabilize litation for the whole classified network has been the percent of roads in poor condition at current levels, reduced according to GNP per capita, following the and Strategy (4) would restore all economically justified methods outlined in Annex 2. It has been necessary to roads so that none would be in poor condition by the use such a formula because of the lack of data on costs end of the century. It should be noted that all of these and traffic, and hence the economic viability of roads figures apply only to the priority network as estimated for many countries. The application of a GNP formula by the GNP model. Non-priority roads, which, in most reduces the network to be maintained by about 25% for cases, would continue to receive minimal maintenance, paved roads (although it has been assumed that all would remain in fair or poor condition unless or until paved roads will receive routine maintenance) and 50% traffic or other factors warrant rehabilitation. for unpaved roads. Use of the GNP per capita model to eliminate uneconomic roads reduces the estimated cost of the maintenance program for Sub-Saharan Africa by Maintenance Program Requirements Compared more than one-third, but for the lower income countries to Current Expenditures the cost is reduced by as much as 80%. Although the use of such a formula may not give an accurate picture The possible courses of action therefore range from the of what is actually required for each country, it does minimum cost alternative involving continued deteriora- give an indication of the aggregate amount of expendi- tion, up to restoration of all routes to good condition by ture required for priority networks for Sub-Saharan the year 2000. The cost of restoring all roads to Good Africa as a wholes. Programs required for low-income condition by the end of the century (US$1,147 million countries tend to be underestimated while those for a year) represents about 0.8% of regional GNP.6 This high-income countries tend to be overestimated, but percentage of GNP compares with an overall average of such disparities tend to cancel each other out. estimated expenditures on roads in 1988 of 1.1% of GNP which varies from a low of 0.14% for Uganda to Total costs of the four maintenance strategies, reduced about 3.0% for Cameroon, although large construction to annual average expenditures over the period 1989 or upgrading programs on small networks are usually through 2000, are presented in Table 4A. These costs the reason for the high figures. Although this seems to only refer to the high priority network and do not indicate, based on average figures, that at least partial include low traffic feeder roads. However, the amount restoration of the road networks of Sub-Saharan Africa of expenditure required for the maintenance of feeder to sound condition by the year 2000 should be within roads is comparatively small in relation to the main the region's financial capabilities, there are several road network. All costs are in constant 1988 prices. reasons why this may not be the case. The cost of restoring all economic roads to good condition by the year 2000 Strategy (4) is estimated at Comparing the required percentage of GNP with what US$1.15 billion a year for the next twelve years. The has been reported as spent on roads in recent years cost in the first seven years (US$1.2 billion per year) (where 1986-87 data was not available, 1984 data was would be slightly higher than for the last five years used) shows that 21 of the 41 countries have reported (US$1.05 billion per year) because of the work required annual expenditures on roads exceeding the level now to prevent roads now in fair condition from deteriora- required to maintain and restore all economic routes. ting to poor condition, which means more overlays Thirteen countries have reported lower rates of expen- would be carried out in the first seven years. The diture, and seven have not provided data. Of the coun- breakdown of total expenditure required under Strategy tries reporting lower rates of expenditure than required (4) for different maintenance activities over the period to restore their networks, Gabon, Nigeria, and Swazi- 1989-2000 is shown in Table 4B. land have spent far more on roads in prior years and would presumably have the resources to increase fund- ing to required levels. This leaves nine countries Road Condition (Uganda, Tanzania, Comoros, Guinea, Zambia, Ghana, Sierra Leone, Liberia and Mauritania) which may have Obviously, various strategies would have different difficulty in increasing road funding to the necessary implications for the condition of high priority roads, as levels. Among those which have not supplied data, it is indicated in Table 4C. If only routine maintenance is very likely that Chad, Equatorial Guinea, Guinea carried out, Strategy (1), 78% of paved roads would be Bissau, Mozambique and Somalia are in the same situa- in poor condition in East Africa and 91% in West tion, although Chad and Guinea-Bissau will soon be Africa by the year 2000, while no unpaved roads would receiving much higher external assistance for mainte- be in good condition. By at least preventing roads now nance if externally-financed projects now under in good condition from further deterioration, Strategy preparation come to fruition. 23 Melody Mason & Sydney Thriscun: Road Deterioration in Sub-Saharan Africa TABLE 4A SUB-SAHARAN AFRICA: MAINTENANCE STRATEGIES AND COSTS (US$ million per year) Strategy (1). Continuation of Routine and Minimal Maintenance Total Cost Foreign Exchange East Africa Paved 54 8 Unpaved 50 7 West Africa Paved 57 9 Unpaved 67 10 Total 228 34 Strategy (2). Roads now in Good Condition Correctly Maintained, plus Minimal Maintenance on Balance Total Cost Foreign Exchange East Africa Paved 99 31 Unpaved 69 18 West Africa Paved 144 53 Unpaved 97 21 Total 409 123 Strategy (3). Maintain Good Condition Roads and Restore Fair Condition Roads to Good, plus Minimal Maintenance on Balance Total Cost Foreign Exchange East Africa Paved 193 95 Unpaved 101 31 West Africa Paved 215 113 Unpaved 171 46 Total 680 285 Strategy (4). Restore Economically Justified Networks to Good Condition by Year 2000 Total Cost Foreign Exchange East Africa Paved 276 140 Unpaved 140 45 West Africa Paved 470 251 Unpaved 261 78 Total 1147 514 For comparison, the estimated annual cost to restore all roads to good condition by the year 2000 is as follows in millions of US Dollars: Paved Unpaved Total East Africa 480 429 909 West Africa 542 389 931 Total 1022 818 1840 24 Melody Mason & Sydney Thriscut: Road Deterioration in Sub-Saharan Africa TABLE 4B TOTAL EXPENDITURE REQUIRED UNDER STRATEGY (4) for the period 1989-2000 Expenditure KM (USS million) Reconstruction of paved roads 18,570 3.90 Reconstruction of unpaved roads 39,390 1.30 Strengthening/Resurfacing of paved roads 20,430 1.90 Rehabilitation of unpaved gravel roads 33,930 0.80 Resealing of paved roads 84,390 2.00 Regraveling of unpaved roads 107,690 1.40 Total 304,400 11.30 Annual requirement for routine .iaintenance: US$ 0.23 billion Consequently, about 60% of the countries in Sub- categories (Table 5). Countries in the first Group have Saharan Africa have demonstrated the ability to provide demonstrated a commitment to maintenance and have sufficient funds, at least for a single year, to finance the the ability to implement maintenance programs and scale of expenditure called for to restore their road attract adequate resources to the highway sector (from networks. However, although the level of funding has both internal and external sources) to carry out adequate been on a scale approaching what would be required for maintenance, although more may be necessary in the correct maintenance and restoration of the network, the future. Countries in the second Group have not demons- proportion of road funds allocated for maintenance and trated the same level of commitment to maintenance rehabilitation has not. The need in these countries is not and have consequently not been able to build up the so much the provision of extra funds for roads, capacity to implement programs. Nevertheless, efforts although finding the necessary foreign exchange will be to improve maintenance look promising and financial difficult, but rather to ensure that available funds are resources would probably be forthcoming based on directed towards essential works and used as efficiently current levels of extemal aid for the highway sector as possible. It would be unrealistic to expect all (provided they are concentrated on maintenance). construction and improvement work to come to a stop, but a large reduction from previous levels is essential. The third Group countries have neglected road mainte- It will also be necessary to move towards a more nance despite having the capacity and financial resour- sustainable balance between routine and periodic ces to prevent excessive deterioration of their road maintenance. However, for the other 40%, even networks. They have the necessary sources of financing, stopping all new works until the year 2000 would still and the ability to prepare maintenance programs and to call for higher levels of road financing than previously build up their maintenance capacity. If there were to provided, which will be unrealistically high in some be a change in commitment towards improved mainte- countries. The position is complicated by the fact that nance, it would be possible for them to restore their the poorer the country, the more difficult it becomes to road networks. allocate even low proportions of GNP to road maintenance with any degree of certainty. Countries in the fourth Group have neglected road maintenance and have experienced severe problems in developing implementation capacity and/or attracting Country Situations sufficient resources to the road sector. Some of them have allowed roads to deteriorate to the extent that it Obviously, the prospects for clearing the backlog of will be very difficult to clear their maintenance back- maintenance vary from one country to another. These logs by the end of the century. Commitment to mainte- prospects depend on the level of commitment to nance would have to go hand-in-hand with changes in maintenance, the capacity to implement maintenance macroeconomic conditions to make available the neces- programs, and the availability of funds. Based on past sary inputs and attract the private sector to maintenance experience, countries can be placed into one of four activities. 25 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa TABLE 4C PROJECTED ROAD CONDITION Maintenance Strategies: Condition of Roads Good Fair Poor Present Condition Paved: E. Africa 50 33 17 W. Africa 53 18 29 Unpaved: E. Africa 37 30 33 W. Africa 19 34 47 Condition of Roads in year 2000 Strategy (1): Routine Paved: E. Africa 0 22 78 maintenance only W. Africa 0 9 91 Unpaved: E. Africa 0 0 100 W. Africa 0 0 100 Strategy (2): Prevent Paved: E. Africa 50 0 50 roads in Good condition W. Africa 53 47 from deteriorating Unpaved: E. Africa 37 0 72 W. Africa 19 0 81 Strategy (3): Restore Paved: E. Africa 83 0 17 roads in Fair condition W. Africa 71 0 29 and maintain Good roads Unpaved: E. Africa 28 30 42 W. Africa 53 0 47 Strategy (4): Restore Paved: E. Africa 85 15 0 roads in Fair and Poor W. Africa 85 15 0 condition and maintain Good roads a/ Unpaved: E. Africa 85 15 0 W. Africa 85 15 0 aj Although no roads are shown in Fair or Poor condition in 2000, there will always be some temporarily in those categories even in a well run network, with 10-15% either in Fair condition awaiting remedial treatment or in Poor condition awaiting improvement or upgrading. 26 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa TABLE 5 GROUPING OF COUNTRIES ACCORDING TO ROAD MAINTENANCE CAPACITY Group 1: Group 2: Countries with a demonstrated Countries with a commitment to maintenance, growing commitment to effective institutional maintenance, and improving capacity, and mostly adequate implementation capacity financial resources jJ and availability of financial resources Botswana Mauritius Djibouti Madagascar Malawi Lesotho Ivory Coast Swaziland Niger Ethiopia 2 Zimbabwe Burundi Rwanda Mali Benin C.A.R. Togo Group 3: Group 4: Countries that have Countries that have neglected maintenance neglected maintenance despite adequate imple- because of inadequate mentation capacity implementation capacity, and availability of and financial resources financial resources Kenya Zambia Nigeria Mozambique Gambon Zaire Cameroon Uganda Senegal Sudan Somalia Sierra Leone Liberia Ghana Guinea Equatorial Guinea Burkina Faso Gambia Mauritania Guinea-Bissau Chad 1} Adequate financial resources subsumes a reallocation of funds from new construction to maintenance, and the availability of funds from donors for maintenance. 21 Ethiopia used to be in Group 1, but has recently incurred more problems with funding of maintenance and implementing maintenance program. 27 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa Taking into account the financial resources and absorp- presently in fair condition are not to be allowed to tive capacity of SSA countries, about one-third of deteriorate further more funding will be required from countries would probably not be able to restore their now to 1995, so that a 43% increase in aid would be high priority network to an adequate condition by the required in the first seven years, and a 25% increase year 2000 given current macroeconomic conditions and after 1995. Some countries will obviously not be able the size of the backlog of maintenance. Another 10% of to contribute 20% of total costs, especially since eleven countries have the financial and implementation capa- countries have not been able to even finance their city to clear their maintenance backlog by the end of routine maintenance activities (Guinea Bissau, Niger, the century but may well not achieve this because of a The Gambia, Burkina Faso, Togo, Comoros, Somalia, continuing lack of commitment to road maintenance. Uganda, Tanzania, Mozambique and Angola). The pre- On the other hand, because of a commitment to road sent financial situation is such that about 80% of Sub- maintenance and a demonstrated capacity to implement Saharan Africa countries will probably require external road maintenance programs, about 20% of Sub-Saharan assistance for periodic resurfacing activities, as well Africa countries should be able to restore (or in some as for strengthening and reconstruction. Nigeria, Came- cases retain) their roads to good condition by 1995. The roon, Gabon, Congo, Botswana, Mauritius, Cote remaining countries should be able to restore their d'Ivoire, and possibly Swaziland, should be able to networks by 2000, albeit with considerable technical finance their own routine and periodic resurfacing assistance for some, assuming that they can strengthen activities but may still require assistance with their commitment to road maintenance. strengthening and reconstruction works. It is unlikely that a 43% increase in aid can take place External Funding of Highway Expenditures between now and 1995, especially considering the time it would take for project preparation. More importantly, External funding for road projects for Sub-Saharan it is unlikely that many countries could absorb very Africa from all sources amounted to US$6.5 billion much more assistance, judging by their past records. A over the period 1975 to 1986, 60% of all transportation review of road maintenance programs shows that 27 aid from 1975 to 1986'. In 1985, roads aid amounted countries in Sub-Saharan Africa are implementing pro- to approximately US$800 million, 44% of which was grams (with a further 10 countries actively preparing financed by the World Bank and 56% by other donors, them) but that 60% have either had, or are about to If recent patterns of financing continue, expenditures on have, substantial delays. Reviews of maintenance externally aided road projects in Sub-Saharan Africa in projects generally indicate over optimism about the rate immediate future years would amount to about of project implementation. This means that clearance of US$1,000 million a year, involving contributions from all the backlog by the end of the century is most the Bank of about US$350 million (44% of external unlikely, and it would be unduly optimistic to expect aid and US$450 million (56% of external aid) from that such an increase in aid could be absorbed. In other donors totalling US$800 million a year, plus addition, ongoing construction and improvement US$200 million a year from local resources. If the projects have to be completed, and any switch into 80% proportion spent on new construction could be reduced of total expenditures for maintenance cannot be expect- to 20% of the total, US$800 million a year could be ed within less than three years, even with the full available for maintenance. To achieve this target, support of governments and donors. Taking these fac- donors would have to reallocate funds in some tors into account, it seems unrealistic to expect that it countries from new construction to maintenance. This will be possible to clear the backlog of roads which are would allow roads in good condition to be kept in economic to restore by the year 2000. sound condition and roads in fair condition to be restored to good condition, Strategy (3); however, it In spite of the apparently bleak situation in the region, would not permit the restoration of all roads in poor a number of cases show that, with determination and condition, Strategy (4). The local cost component of the commitment, very real improvements can be achieved total maintenance program amounts to about 55% of in even the most unpromising circumstances. Roads in total costs, so that external assistance would need to Madagascar had been neglected for years, and the 1984 cover not only foreign costs but over 60% of local cost. survey showed that half the main paved road network had failed. There had been inadequate allocations for To remove the backlog of roads now in poor condition maintenance (although road user charges were enough in Sub-Saharan Africa countries by the year 2000, the to cover routine and periodic resurfacing costs), poor estimated level of aid for roads would have to increase planning and management, a shortage of trained staff by about 35%, on the assumption that no uneconomic and unsatisfactory contract administration. Government work is included and that funding for new construction decided to improve the position, and helped by the 5th is strictly limited. The local contribution of 20% would and 6th World Bank-financed Highway Projects, the then amount to about US$270 million a year. However, proportion of failed main roads dropped in five years these figures are averages for the whole period: if roads from 50% to 16%. The current 7th Highway Project is 28 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa planned to complete paved road rehabilitation. A similar decades to improve institutional functions within roads story can be told of road improvements in Ghana, authorities by use of management systems and person- although improvement has not yet progressed so far as nel training have been slow to show any concrete it has in Madagascar (see box "Road Neglect and Res- results.' More effective means have to be found for toration in Ghana"). Tanzania and Senegal have both achieving the targets of maintenance programs probably shown willingness to make the necessary changes to by greater use of the private sector. improve road maintenance, and a large(US$1 billion) rehabilitation project is planned for Tanzania. A similar project in Senegal would use local and international Economic Benefits of Road Maintenance contractors to restore most of the main roads to good condition. Other countries, including Ethiopia, Malawi, Disregarding traffic benefits, once the decision is made Niger, Zimbabwe and more recently, Kenya, use mana- that a paved road carrying significant amounts of traffic gement information systems to increase the efficiency should be preserved, alternatives are either to maintain of road maintenance planning and control. When fully the road now or to rebuild it at some time in the future, operational, these will indicate the most economical say in the year 2000. A road now in good condition can level of maintenance, taking account of road condition be kept in operation by a program of resealing or light and traffic. overlay Strategy (2), and the cost to the road authority of doing this is the extra cost of resealing, US$23,600 The average unit costs on which cost estimates are per km every 7 years, or US$3,400 per km per year. based assume that quality control, cost control and allo- This has a net present cost to the roads authority of cation of funds are all effective. To the extent that this about US$21,000 per km (at 12% over 12 years). If the is not the case, the amount and quality of maintenance road is allowed to deteriorate it will require rebuilding work done will fall short of targets, and road conditions at a later date at an average cost of US$210,000 per will not improve as they should. Bank reports contain which has a net present cost of about US$54,000 per frequent references to shortfalls in these three areas, km. Therefore, preventive maintenance results in a and it is evident that efforts over the past two or three saving of US$33,000 per km. Clearly, continued Road Neglect and Restoration in Ghana In Ghana, a good road network existed before 1970, but it later suffered from serious neglect. By 1984, about 60% of the main paved roads had failed, and a further 27% were in danger of failure. Important sections of the network had become almost impassable, and access to some of the interior of the country was curtailed. Transporters refused to go there because they were afraid to damage their vehicles. Transport costs increased in real terms by about 50% on main roads, and by more than 100% on rural roads, which were even more neglected. In some areas, the market rate for transporting fertilizer was as high as a US Dollars per ton-mile. These high transport costs cut into farm profits, particularly for poor farmers away from main roads. During the 1982-83 famine, roads in poor condition prevented the transport of food from surplus areas to areas facing starvation. High transport costs also hit the timber industry. Logs moving from the Kumasi area for export through Takoradi port were trucked over a 500 Ion route, because the direct route, half as long, was impassable, and rail services unreliable. This detour added US$15-20 per ton to the cost of timber. Two World Bank projects starting in 1974 and 1975 achieved their physical targets after some delay, but had little effect on institutional improvement. A small but dedicated group of engineers in the roads headquarters were unable to increase outputs due to complete absence of motivation among most workers. Following an emergency maintenance project in 1980, a road rehabilitation and maintenance project commenced in 1985 which aimed to use the private sector in road maintenance, and to give incentives to force account workers. The project progressed quite well, with delays of about six months due to lack of local funds. This was followed by a 1988 Transport Rehabilitation Project designed to support Ghana's economic recovery program by tackling problems in road and railway maintenance and rehabilitation, transport sector institutions, and infrastructure planning. The outlook is now considerably more hopeful. The proportion of paved roads in Good condition has more than doubled over five years (from 12% to 28%), and the proportion of failed roads has decreased. With incentives of various kinds, force account work is now more productive, while contract maintenance is firmly established. 29 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa maintenance as proposed under Strategy (2) is in the costs and future restoration of the roads than if roads best interests of the roads authority as being the lesser were to be resealed and regraveled in a timely manner cost alternative, although this argument will be less Strategy (2). forceful if rebuilding can be funded by "soft" foreign aid. Similar analyses for Strategies (3) and (4) show that in each case they are a less expensive alternative Conclusion and Policy Recommendations than allowing the network to deteriorate and then rebuilding. Similar arguments apply to unpaved roads. This paper has attempted to forecast the likely state of Governments tend to look at programs in terms of Sub-Saharan Africa's roads at the end of the century if direct costs to the budget and resulting revenues but no extra effort is made to improve road maintenance. correct road maintenance affects the general public far The forecasts are hampered by poor data, and a first more than it does the government. The benefits to road essential is to improve data collection and processing users, and therefore the economy as a whole, are subs- for information on roads so as to allow for effective tantial. For example, at average traffic flows and programming and monitoring of maintenance activities. composition for the region, a paved road which has With good data, reliable forecasts can be made in been allowed to deteriorate from good to poor condition greater detail. But in spite of inadequate data, the represents an annual loss to the country of about general prognosis in this paper is clear: governments in US$5,000 per km in vehicle operating costs, mostly in Sub-Saharan Africa will face much larger outlays foreign exchange. For unpaved roads, which carry within a decade or so simply to keep their essential lower average traffic flows, the loss is about US$3,000 road networks in operation if they do not concentrate per km per year. The order of magnitude of the total on road maintenance now. savings to be realized from lower vehicle operating costs for the reduced programs under each strategy is Roads that are not maintained will have to be rebuilt at illustrated in Table 6. a much higher cost within a few years if road networks are to remain in place. There is, in addition, the As shown, substantial savings can be realized by undeniable but not so obvious fact that African coun- maintaining roads in good condition. Strategy (3) has tries use large amounts of foreign exchange every year the highest total net economic returns of US$2.86 (importing vehicles and spares) to replace vehicles that billion (net present value over 12 years at 12% discount are damaged and worn out prematurely by poor road rate) because of the high returns on preventive mainte- conditions. Unfortunately, it is a major problem nance to arrest the deterioration of roads now in good convincing policymakers of the importance of vehicle and fair condition and the resulting cost of restoration operating cost savings to the economy as a whole since in the future. Of particular importance for Sub-Saharan these savings do not accrue to the government budget Africa countries are the savings in foreign exchange. directly, although they do represent a constant drain on For example, if roads now in good condition are foreign exchange. Only in the longer term do the bene- allowed to deteriorate, 2.7 times more foreign exchange fits of road maintenance accrue directly to governments would have to be spent on increased vehicle operating in the form of savings from not having to rehabilitate TABLE 6 TOTAL SAVINGS FROM VEHICLE OPERATING COST ONLY Maintenance Program Vehicle for Operating High Priority Network Cost Savings jJ Strategy (2) over (1) 1,140 Strategy (3) over (1) 2,300 Strategy (4) over (1) 3,110 jJ Net Present Value 1988-2000, at discount rate in US$ millions 30 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa Cost Implications of Different Maintenance Strategies NPV Compared to Base Case ($Million) Strategy (iv) over (i): over 12 years Restore roads in Poor at 12% and Fair condition and prevent roads in Good 8000 condition from deteriorating 7000 Strategy (iii) over (i): Restore roads in Fair condition to Good and 6000 prevent roads in Good condition from deteriorating 5000 4000 - Strategy (ii) over (i): Prevent roads in Good condition from deteriorating 3000 2000 1000 0 Total Foreign Total Foreign Total Foreign Exchange Exchange Exchange E Savings in vehicle operating Cost of restoring roads to i !ncreased cost of costs Good condition in 2000 maintenance strategy 31 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa roads. In the short term, governments may appear to be prospects of restoring their road networks, with outside making budgetary savings by reducing road mainte- assistance if necessary. On the other side of the nance allocations, but there is a net loss to the economy spectrum, there are those countries with histories of as a whole, due to higher road user costs. uneconomic investments in transport, misallocation and mismanagement of road maintenance funds, making or- Road maintenance is always in competition for resour- ganizational changes for changes' sake, and a tendency ces with all the other activities of governments, to view technical and economic factors as a secondary many of them apparently more urgent, and most more consideration, when their economies are not in a obvious. While economic arguments on losses to the position to be able to afford this luxury. For these country in the shape of increased road user costs may countries, the outlook for restoration of their road convince economists, finance ministries tend to be more networks to Good condition by the end of the century interested in the immediate cash situation. If by cutting is bleak. back on road maintenance allocations they can appear to save money at present, they may be relatively unin- Governments must decide on a well planned mainte- terested in the threat of a larger payment at some time nance program concentrating on the high priority in the future. This is especially true if the possible network and excluding those sections of the network future payment can be met by a donor on very easy where high expenditures cannot be economically justi- terms. It is only when the roads engineer is in a fied. This can mean relegating some roads to a minimal position to demonstrate that if he does not get or even to a no-maintenance strategy. These measures US$1,000 now, he will have to spend US$10,000 in the have been taken in a number of countries, and a start next year- and be proved correct that finance made on correct planning for future maintenance, within ministries will listen. Road management systems, the resources available. as they are being installed in some Sub-Saharan African countries provide a means of forecasting road It has been estimated that about US$1.15 billion is conditions and maintenance needs. required annually to restore all priority roads to good condition by the end of the century. About two-thirds of The single most important factor for restoration of road the countries in Sub-Saharan Africa had access to suffi- networks over the next decade is to obtain government cient funds needed for maintenance during the recent commitment to road maintenance. There have been past, but the majority of these funds were spent on new many cases where the lack of government support has construction. It will, therefore, be necessary to reduce meant the failure of maintenance programs, despite the expenditures on new construction in the fitture and con- availability of funds. Attempting to set up a functioning centrate resources on road maintenance. In the remain- road maintenance system is unlike building a new road ing one-third of the countries, maintenance funding has which is handed over in working order on project com- been severely inadequate, although some are about to pletion. In a road maintenance project it is mainly an receive substantial increases in external assistance. organization and a set of patterns of behavior which are Nevertheless, even if financial resources could be made put in place, all of which can vanish within a short time available, there is a far greater problem of absorptive it there is no potential will and commitment to support capacity, especially for some of those countries with them. Hence, external aid for road maintenance cannot large backlogs of work. Taking such implementation achieve anything permanent if the governments of the problems into consideration, it has been estimated that countries concerned are not convinced of the need for about one-third of the countries would not be able to better road maintenance. restore their high priority networks by the year 2000. Even for other countries the situation is by no means A study of the present state of roads shows that some certain unless the commitment to maintenance radically countries with low GNPs and apparently difficult improves. With such a commitment, it should be physical conditions have, nevertheless, managed to keep possible to carry out the necessary maintenance their road networks in better order than others with programs, provided external assistance is forthcoming, more funds at their disposal. In countries with a sound especially where countries have already prepared and/or road maintenance record, one common factor seems to are implementing a program of maintenance reforms. be their genuine long-term commitment to maintenance. They have been prepared to take and use advice from The task of implementing effective maintenance pro- outside, to set up maintenance systems and keep them grams should not be underestimated even where the in place without constant changes, and to give road financial resources are available and there is the maintenance a high priority in budgetary allocations. necessary support from government. Experience of road Perhaps the major factor has been an interest and projects in Sub-Saharan Africa is that whereas physical commitment on the part of the most senior people in construction work is usually completed, albeit after government towards the preservation of their country's many delays, the institution building targets to improve past investments in roads. Countries that can demons- planning, organization and supervision of work are trate, or develop, this approach usually have good seldom met Efforts to improve the efficiency of 32 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa governmental organizations have generally been Those operations which are to be undertaken by force hampered by such factors as lack of incentives and account will require substantial changes in maintenance accountability, poor career prospects, low pay, and agencies. Greater incentives must be given to mainte- cumbersome bureaucratic procedures. Training, as a nance staff since low wages generally result in low means to improve operational efficiency, has also not motivation levels, and poor career prospects in complete been very effective. Even if those trained remain in lack of initiative. Greater efforts have to be made to their positions or in government at all, they often find balance the inputs required for maintenance so that they are unable to apply what they have learned, resources, such as labor, are not left idle for lack of because resistance to change at the higher staff levels fuel or spare parts for equipment. More consideration prevents the introduction of new methods and ideas. has to be given to making government mechanical Mechanical equipment is used inefficiently; major plant workshops competitive with the private sector, other- items are commonly used for only one or two hundred wise vehicles should be hired from, or repaired in, the hours a year instead of a thousand hours or more, private sector when government agencies cannot pro- which makes equipment owning costs quite exorbitant. vide an adequate service. As it has been found difficult to improve force account To summarize, the first step is to attempt to convince operations in road maintenance, there is a strong case the public and as many in government as possible of for the use of contractors on the basic assumption that the wisdom of concentrating scarce resources on pro- unless a well-supervised contractor is reasonably effi- perly planned road maintenance, rather than new cient, he will sooner or later go out of business, and if construction and improvement. Where this conviction he does not perform as expected, he does not get paid. takes hold, procedures need to be developed and Although the first indications are hopeful, it is too early installed to decide which roads are most in need of to say that contract maintenance will solve all problems. early attention, which roads can be left for later Where an active contracting industry does not already rehabilitation, and which roads can be relegated to a exist, to set one up and train contractors and employers minimal level of maintenance. While a suitable program in sound contract management is similar to the task of is set up, the best way of executing the program must institution building within government organizations. be decided, taking maximum advantage of the possibili- However, the private sector has greater freedom to ties of contract maintenance and use of increased overcome the problems faced. Existing force account incentives. Resource constraints in some countries and organizations can sometimes be transformed into lack of interest in others mean that it is very unlikely successful contracting firms, with competition and the that more than a part of the backlog will be restored by prospects of profit providing the incentive which is the end of the century. While some countries will be lacking in government organizations. able to restore all priority roads Strategy (4), others will have considerable difficulty in keeping their roads Using contract maintenance does not mean that the presently in fair or good condition in a reasonable state. roads authority is at once relieved of all responsibilities. Both planning and supervision must be at a higher stan- dard than for force account work, since the results of From the viewpoint of the donor agencies and their poor planning and supervision can easily lead to expen- own resource constraints, it will be important that road sive claims and extra payments to the contractors- maintenance aid be directed first to those countries that results which are less easily concealed than mistakes in have shown commitment to better maintenance by redu- force account operation. There is thus the need for cing the proportion of roads expenditure spent on new reduce4 but more efficient technical staff in the roads works and setting up rational maintenance planning authority, who need the backing of an efficient financial systems. The target for financing could be Strategy (4), administration able to process payments quickly. To that is, aboutUS$1,300 million a year, including techni- monitor the operations, independent technical and cal assistance and training in 1988 prices. It is unlikely financial audits need to be in place. that roads aid to Sub-Saharan Africa countries can be realigned completely into the necessary priority for If contract maintenance is to be at all effective, local maintenance in less than three years, and the scale of procurement procedures have to be improved. Mainte- effort then needed would be comparable with that now nance requires the letting of many small contracts, envisaged for Tanzania and Ghana in their roads resto- which are best handled at the field level, particularly for ration plans. Ghana is showing some signs of slippage routine maintenance activities. Procurement regulations from the five to seven year program originally planned, often make it very difficult, and sometimes impossible, and it is still too early to say what progress there will to handle a large number of contracts expeditiously be in Tanzania. Given a real commitment on the part of given the time required to satisfy the restrictive Sub-Saharan Africa governments, it would be realistic regulations. It is essential that procurement procedures to foresee foreign-aided road projects in Sub-Saharan be streamlined and adapted to the special requirements Africa countries amounting to about US$1,300 million of road maintenance. a year (in 1988 prices) up to the year 2005 to restore 33 Melody Mason & Sydney 7hrisca: Road Deterioration in Sub-Saharan Africa all priority roads to good condition. Since there would in particular, should be planning for an increase of up be heavier expenditure in the early years to save roads to 50% in their expenditures on roads in Sub-Saharan now in good condition from rapid deterioration, donors Africa, with the great majority devoted to road in Sub-Saharan Africa in general, and the World Bank maintenance and rehabilitation projects. Endnotes: 1. The latest road condition data is generally for 1987 or 1988. Four countries were included in the analysis by using the last available data for 1984. Suitable data for Angola, Cape Verde, Reunion, Sao Tome & Principe and Seychelles are not available. 2. In some cases, information is only available on the overall percentage of funds spent on new construction and the general adequacy of maintenance activities whereas details of actual expenditures are either not available or there are conflicting figures. 3. See Robinson et al, "The Road Maintenance Crisis in Africa: An Agenda for Action", World Bank paper, May 1985. 4. O.K. Sylte, "Review of World Bank Programs on Highway Maintenance and Rehabilitation in Africa". SSATP, April 1988 (draft report). 5. To check the effect of the GNP model, comparison was made with detailed estimates for Bank projects in Ghana and Tanzania. In Ghana, a five- to seven-year program is planned to put 74% of paved roads and 64% of unpaved roads in good condition. In Tanzania, a similar program is expected to result in 70% of paved roads and about 50% of unpaved being in good condition. These compare with this paper's estimates for SSA as a whole of about 75% of paved and 50% of unpaved roads being in good condition if the whole program on the priority network is carried out. 6. In 1988, GNP of East Africa was US$56,560 million, and for West Africa, US$84,000 million, a total of US$140,560 million equivalent. 7. For 1975-84 data, see "Review of External Financing of the Transportation Sector of Sub-Saharan Africa", Bank Draft paper by Sylvie Chantal, July 1987, Table 3.3. 1985 and 1986 data are derived from OECD figures on total aid to SSA. 8. Combined Bank and IDA projects now in preparation stages total about US$1.0 billion which are assumed to be spread over the next three years (Annex 3). 9. For examples, see OED Report No. 5085, "Institutional Development in Africa: A Review of World Bank Project Experience" (May 1984) and OED Report No. 3834, "Review of Training in Bank Financed Projects" (March 1982). 34 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa Annex 1 Data Sources To acquire data for this study, road maintenance ques- for this study were used in that model to compare the tionnaires were sent to all Sub-Saharan Africa countries. situation in 1984 and 1988. Another simple spreadsheet Of 44 questionnaires, only 19 responses were received model was developed as part of this study to estimate and of these, only two provide fairly comprehensive the expenditure requirements for different maintenance data. Indeed, a few questionnaires have data that are strategies up until the end of the century. (The data mostly unusable because of inaccuracies and collected on road condition as part of the Road inconsistencies. Data on maintenance unit costs and Deterioration Policy Study have been used for four equipment are particularly scarce for all countries. In countries where no later data are available for the order to have more information for the study, further purposes of estimating maintenance requirements.) A data collection efforts were conducted within the Bank database (using Dbase) has been developed to store data and finally data on length of road network, road for those countries that provided at least two-thirds of condition, and unit costs have been obtained for 38 the information requested (about 16 countries) so that countries, as well as, data on road expenditure for it can be used in the future for comparative purposes. 25 countries. Remaining data on staffing, maintenance However, unless the quality of the data improves subs- equipment and past levels of maintenance activities are tantially such a data base will be of very limited use, fragmentary and only available for a few countries. since the information obtained is such that analysis calls for repeated subjective judgments and the use of region- The Road Deterioration Policy Study results were based wide averages because of the unreliability of individual on a simple spreadsheet model, and the data collected country data, such as unit costs. 35 Melody Mason & Sydney Thriscut: Road Deterioration in Sub-Saharan Africa Annex 2 Maintenance Requirements and Cost Estimates In estimating road maintenance requirements, the fol- and up to two light gradings a year are included; and lowing assumptions have been made: * the distribution of high priority roads (traffic over * that under current conditions in most Sub-Saharan 350-400 vpd) among good, fair and poor categories is countries of Africa, paved roads carrying up to 400 vpd the same as for the rest of the network. This can be kept in good condition by timely patching of assumption has been made in the absence of reliable locally failed areas plus resealing. For higher traffic data on the condition of the high priority network. The flows, a premix overlay would be used. Due to often same assumption was made in the 1984 World Bank inadequate quality control, the life of a reseal is 7 Road Deterioration Policy Study. years, except in a few countries where standards of The costs of road maintenance operations have been work are higher (Botswana, Zimbabwe, Malawi, estimated from country and Bank data, adjusted to 1988 Swaziland, C6te d'Ivoire, and Niger) when 10 years is levels. These display wide variations between, and even assumed. The average cost of resealing used in within, countries, due in part to different input costs, estimates (US$23,600 per km) is for a two-lane road, affected by scarcities, transport costs and high taxes. and allows for a normal amount of repairs in advance There is also the problem of defining precisely the of resealing, plus the additional cost (and life) of some maintenance operation. For example, some countries type of premix overlays on approximately 10% of the include shoulder grading and surface patching in routine network where higher traffic flow warrants its use; maintenance costs for paved roads, while others do not. * that to restore a paved road in fair to goodl condition, Mechanical equipment costs are allowed for in different repairs of up to 10% of the surface area will be ways in different countries, ranging from the cost of necessary, plus a strengthening surface layer of 5 cm or fuel and lubricants only, up to full commercial costing. more. The average cost used (US$93,000 per kIn) is for Consequently, the following analysis has used estimated a two-lane road and allows for surface repairs, average unit costs, derived from often incomplete data regulation and raising the shoulders as necessary. in questionnaires, plus assessment of normal input Without strengthening, it has been assumed that a road requirements and costs. The unit costs used approximate in fair condition will deteriorate to poor condition after reasonable contract costs, assuming effective competi- seven years; tion exists, and that contract prices are not increased on * that to rehabilitate a failed paved road in poor account of such factors as non-availability of foreign condition, the existing construction can be used as sub- exchange, distorted foreign exchange rates, inordinately base, but that new base and surface layers will be high interest rates, or bad contract administration. The necessary. In the average cost (US$210,000 per km), nature of the various maintenance operations for which allowance is made for some extra earthworks on costs have been estimated are defined in the Glossary, shoulders and sideslopes. Mixed traffic of about 400 in order to clarify what is included. vpd is assumed, and a CBR 10 subgrade; In the absence of detailed traffic information, GNP per * that gravel roads consist of about 15 to 20 cm of capita was used to eliminate those roads which, from an imported natural material, and that deterioration from economic standpoint, probably would not warrant reha- good to fair condition occurs in six years, with the loss bilitation or other maintenance activities; this affects of about 2 cm of surface material per year. Thereafter, those countries with a GNP per capita below US$500 if no action is taken, unpaved roads regress to poor per annum. Data for Mali and Niger suggest that the condition in a further four years, when restoration of proportion of a country's road network that warrants the formation becomes necessary. An average cost of rehabilitation roughly correlates with GNP per capita. US$13,000 per km for regraveling and US$33,000 per For paved roads, the relationship is 0% at zero GNP kIn for unpaved rehabilitation from poor condition has per capita and 100% at US$500 per capita. For unpaved been adopted; roads, the values are 0% at US$150 per capita and 80% at US$500 per capita. Ideally, actual traffic levels * that routine maintenance costs US$1,000 per km per should have been used to determine the economic high year for both paved and unpaved roads. For paved priority network but since even limited traffic data was roads, this includes normal minor repairs to the surface not available for over half the countries, some kind of and shoulders, and for unpaved roads spot regraveling proxy had to be used. 36 Melody Mason & Sydney Thriscutt: Road Deterioration in Sub-Saharan Africa Atmex 3 Road Maintenance Aid Projects Planned or Under Preparation Country Amount & Lender Project Description Status (US$ million) Burkina Faso 15.0 (IDA) Road Maint. & Rehabn. Under Preparation Burundi 19.4 (IDA) Road Maint. & Rehabn. Under Preparation Cameroon 100.0 (WB) Feeder Road Maint. & Pre-Appraisal Rehabilitation February 1989 C.A.R. 10.0 (IDA) Road Maint. & Maint. Under Preparation Planning using P.P.F. Chad 46.5 (IDA) Rehabn. & Maint. of Project Appraised Tpt. Infrastructure Congo 27.0 (WB) Road Rehabilitation Negotiations - Jan'89 Cote d'Ivoire 100.0 (WB) Time slice of Road Identification Investment Program Gabon 30.0 (WB) Three-year Program of Appraised Road Maintenance Mali 10.0 (IDA) Three-year Investment Under Preparation Program Mauritania 20.0 (IDA) Management of Road Preappraised Sector & Repairs Mozambique 30.0 (IDA) Tpt. Rehabilitation Appraised Niger 35.0 (IDA) Road Maint. & Feeder Under Preparation Roads Nigeria 250.0 (WB) Rehabn. & Maint. of Approved June '88 Federal Roads Rwanda 33.5 (IDA) Road Maint. & Feeder Under Preparation Roads Senegal 45.0 (IDA) Road Upgrading & Appraisal - Jan '89 Maint. Sudan 83.0 (IDA) Road Rehabn. & Appraised Reconstruction Tanzania 100.0 (IDA) Road Rehabilitation Under Preparation Zaire 105.8 (IDA) Road Rehabilitation Under Preparation Total: 1,060.2 37 Policy Issues and Options Topic A: Planning, Financing and Management Lack of financial resources is the given reason for poor three background papers prepared under RMI Seminar road maintenance in Sub-Saharan Africa. This may be Topic A: "Planning, Financing and Management." valid for about half of the region's countries; in the others, road expenditures have been at a level that could A Unified Planning Framework have adequately financed maintenance and road rehabil- itation. Had effective planning, programming and Problems budgeting mechanisms been in place, the prospects of adequate maintenance would have improved consider- Where resources are scarce as in Sub-Saharan Africa, ably. Topic A of this seminar examines these issues and it becomes essential to ensure that public expenditures suggests structural approaches to improve maintenance on roads will bring at least as great a benefit to a performance. country as alternative uses of resources. Between sectors, quantitative comparison of benefits is not easy, A common theme in the papers is the need for a and the allocation between transport and, say, health or recognition of the importance of road maintenance and education becomes a matter of political policy or gene- a high-level political commitment to it. The region's ral development strategy. It should be clear, neverthe- annual losses in increased road transport costs due to a less, that neglect of road maintenance has serious a lack of attention to maintenance are estimated at medium- and long-term consequences that can adverse- US$1.2 billion; the more governments and their publics ly affect the economic and social progress of a country. become aware of the magnitude of these losses, the more likely it is that a commitment to improve road The trade-offs between road expenditure options can, maintenance will be made. however, be quantified to enable countries to make comparisons and choices between new road construc- While there is scope for increasing funding for the tion, the restoration of failed roads, or the maintenance roads sector from foreign assistance as well as domestic and preservation of serviceable roads. The goal should sources, improvements in the use of already available be to minimize total national transport costs over time. resources are a necessary fist step before a credible Thus the costs of investments in new construction, case can be made for more money from either local maintenance, and rehabilitation plus the costs in vehi- taxpayers or external donors. This topic deals with ways cle wear and tear, to users of bad roads, must all be in which financial resources can be mobilized and put weighed in planning a roads program. to use so that scarce funds are used most effectively where they are most needed and can do the most good. For many countries, lack of reliable data on road condi- tions, traffic levels, current costs and outputs has Three key issues emerge as basic to improving funding, impeded the analysis needed to compare expenditure planning and programming for more effective and effi- alternatives. Without these data, planning is reduced to cient road maintenance: guesswork; scarce resources of materials, equipment and skilled labor are likely to be wasted, and credibility * Developing a unified framework for planning road is unlikely to last more than a single budget cycle. expenditures over the entire network, whether Planning without facts is a hazardous venture. recurrent or capital, and whether funded by local sources or aid-financed; Policy Options and Actions * Adopting funding and budgeting procedures that Setting out and comparing expenditure options is the assure that funds are available as and when re- first step towards producing a credible roads program quired, and can be adapted to respond to changes in that can win the commitment of governments, transport needs; and, customers, and foreign donors. This requires an assess- ment of all road programs-whether capital, current, * Developing planning and programming methods that locally funded, or aid-financed-under a unified pro- foster accountability, in particular, by programming gramming and budgeting framework. In almost all on the basis of physical outputs and monitored road countries such exercises will demonstrate that road conditions. maintenance and reconstruction have economic returns several times that of almost all new construction. Roads These three issues and some of the options available are departments or national governments may wish, on discussed below. They are covered more fully in the occasion, to choose an investment whose long-term cost 38 Topic A: Planning, Financing and Management is higher than its alternatives. The most important thing, expenditure should be restricted according to the agreed however, is that this choice be made consciously, in full criteria. realization of the costs it implies. If taxes are insufficient to cover the costs of road Road expenditure options cannot be competently asses- construction and maintenance they must be supple- sed unless a management information system is regu- mented from either general taxation or by foreign aid. larly providing the roads authority the information If user taxes exceed total road costs, then the surplus needed as a basis for decision-making. Development of goes to general revenue to help pay for other govern- good management systems and data collection must ment activities. In many countries, road users taxes are proceed together. Reliable information on predictions of seen as a practical means of collecting general revenue. the future condition of the network, the costs of future There is nothing intrinsically wrong with this, so long rehabilitation if funds are not provided, and higher road as these diversions are not so large as to lead to under- user costs if maintenance is not done, permits the roads funding of the roads sector or subsidies to competing manager to view the roads system as a whole and for- modes such as railways that distort relative prices and mulate a defensible and balanced program of road cons- lead to inefficiency in the transport sector. truction, maintenance, and rehabilitation. User taxes should also be set so that, insofar as possi- One of the most useful features of such systems is that ble, different vehicle types pay according to the road if funds are insufficient to finance an adequate level damage costs they impose on the system. This prevents of maintenance, it is possible to draw up a revised subsidies within the sector that could otherwise skew program that will limit road deterioration and user cost fleet composition toward vehicles that cause more increases to a minimum within the funds available. At damage than they pay for. the same time, the total system costs in terms of future road rehabilitation and increased user costs can be Options for Action estimated, so that the government is made aware of the consequences of underfunding maintenance. User taxes should normally be set at a level that covers at least the variable costs of road maintenance. Most African Experiences countries use fuel taxes to collect the bulk of these revenues, but they should usually be supplemented with In Malawi, a maintenance management system provides taxes more closely related to the damage different reliable cost and performance data for future planning. vehicles impose on roadways. These include taxes on Availability of information on road conditions, traffic, vehicles, spare parts, and tires, as well as vehicle and maintenance costs makes it possible to plan a license and registration fees, particularly for heavier maintenance program for the entire network that mini- vehicles that tend to impose greater damage on roads mizes road failures and reduces road user costs. Zimba- than is recovered through fuel and vehicle taxes. bwe has a similar system, and Kenya is about to put a management information system into effect. Niger has Maintaining a road network requires that resource flows used a simple and effective system for programming be regular and reliable as well as adequate in amount. periodic maintenance. Ethiopia has possibly the oldest In the past the expansion of Sub-Saharan road net- functioning road maintenance and equipment manage- works, often supported by international aid, has not ment system in Sub-Saharan Africa. taken sufficient account of this. Improvements in collecting, allocating, and using funds are obvious Assuring Timely Availability of Funds measures, but even then regular funds for road main- tenance may not be assured because of programming Problems inefficiencies and bureaucratic red tape. It is generally accepted that the main road network Earmarking road user taxes, such as fuel taxes and/or should be paid for by road users or the public as a tolls, with payments made directly to the account of the whole. The government's role is normally to collect roads organization rather than through the treasury or revenues through road user taxes and pass them on, in finance ministry, is one way of increasing dependabi- whole or in part, to the roads organization responsible lity. Alternatively, a special roads fund may be created for providing and maintaining the network. In order for into which some or all road user charges/tolls are it to carry out its duties, the roads organization has placed. Either of these mechanisms gives the roads to be sure of receiving those funds on an agreed organization some long-term assurance that funds will schedule that takes into account cycles of road building be readily available, so that a multi-year road rehabilita- and maintenance activities, such as rainy and dry tion and maintenance program can be planned, if seasons. If funds are allocated but not released on time, necessary with donor cooperation, with the knowledge planned work programs are disrupted, and both efficien- that funding is secure. cy and the road network suffer. If for some reason disbursements cannot be made on the agreed schedule, If sufficient resources to maintain the national road 39 Topic A: Planning Financing and Management network cannot be mobilized, a country may have only Options for Action two options-each of them only a poor second best continued deterioration of the entire road system, or a reduction of its network to a size that is affordable. To Three steps need to be taken if full accountability of the avoid deterioration of the whole network, when funding roads organization is to be established. These are the is uncertain in spite of all efforts, the best remaining definition of quantifiable objectives based on output- choice may be to plan a "core" maintenance program based programming, setting up a suitable quality control that preserves essential roads in the best way possible operation, probably involving a technical audit to run in under the given economic conditions. parallel with the established financial audit, and imple- menting institutional changes to establish an entity African Experiences responsible for the audit. In addition to allowing the definition of objectives to guide agencies in their In Kenya, as a way to finance rehabilitation of trunk operations, output-based programming also provides a roads, several main routes have been designated as Toll basis for monitoring and auditing performance. Routes, with the proceeds paid directly into a special fund. Earmarking of fuel taxes for a special road fund Independent financial audits, operating free of ministeri- to finance road maintenance and rehabiliation has been al control and responsible only to parliament or the used in several Sub-Saharan countries, including Ghana, president, are accepted parts of most governments. Central African Republic and Zaire. Financial audits, however, normally verify only that funds have been spent for the intended purposes as Raising Accountability through specified in the budget. There is no verification that Programming and Budgeting value has been obtained for the funds expended. The concepts of productivity and quality of output are not Problems part of the financial audit's brief, unless the faults are glaring. A technical audit, on the other hand, is con- Improvements in road maintenance programming and cerned that the design of works is correct, that the budgeting can bring large benefits to road users and materials used were appropriate, and that work was cost savings to government. One of the benefits of done according to accepted standards. Obviously, it is planning, programming and budgeting based on compe- convenient and desirable that financial and technical tent and up-to-date data is that unit costs and outputs audits are integrated; a technical audit should also be become transparent, and there is an immediate link free of administrative control. This means that it should between the input resources (materials, equipment and have its own facilities, or at least its own independent labor) and physical outputs of road maintenance opera- staff who may use the roads authority's laboratories and tions. A framework for accountability, thus, is clearly equipment. Although the roads organization may take established. the lead in setting up a technical audit, the agreement Perhaps the most important aspect of this framework is of other ministries and legislature will be needed. that it allows planning and programming to be set on For a technical audit to be effective, technical speci- the basis of physical work outputs so that performance f ica l a e effeci al sei- can be monitored. Thus, future resource needs can be fications are necessary, just as financial audit requires forecast with greater accuracy, and areas in which government financial regulations. It is desirable for efficiency increases are needed are brought to the many reasons, apart from audit, to work towards attention of the road authorities, common specifications for all government work. As the roads organization is usually the most active construct- In practice, however, accountability requires an appro- ion ministry, it is appropriate for it to take the lead in priate institutional framework in addition to data and suggesting uniform contracts and specifications. process requirements. In many countries the oversight and monitoring functions are carried out by institutional Many road maintenance organizations combine the arms that are at the same time responsible for planning, functions of planning and execution, and it is difficult operations, and supervision. in addition to the potential to achieve real accountability when the same person is conflict of interest this structure creates, it also impos- identifying needs, planning the program, organizing and es quite specialized tasks on institutions to carry out the supervising the work and reporting results to some oversight functions. Once the idea of accountability is often remote superior officer. Separation of mainte- accepted, institutional changes will probably be required nance planning and execution requires more careful to define duties and lines of responsibility clearly, planning and specification of works, which is desirable and to make monitoring of results an established in itself. It should also result in better supervision of function of the organization. works and cost control. 40 Ian E. Smith Road Financing and Pricing in Developing Countries Suninary substantial administrative experience to be commer- cially feasible, and often have considerable economic Road users should be charged at least the short-term side-effects. variable, or marginal, costs that they impose, through wear and tear or congestion on the road system. Such Road services can be regarded as a social policy goal charges should directly reflect the costs actually unlikely to be provided in the desired quantities or attributable to the vehicles on which they are levied. locations by the market system. Since a free market Further charges may be levied on road users as contri- would provide only for users able and willing to pay, butions to the invariable costs of road administration the needs of isolated rural communities or low-income and maintenance or to general tax revenues up to the consumers have to be assured through alternative public point where the resulting distortion of the pattern of services or subsidies. Even if the private sector were demand for road transport is compensated by s: gnificant capable of meeting demand for road services, a offsetting fiscal considerations. government might believe that a more efficient use of the economic resources allocated to road transport could Difficulties in translating this theory into practice be achieved by the public/state rather than market include problems of defining and then estimating short- responsibility for road investment and user charging. term variable costs, particularly in economic cost terms, Finally, the private sector may be insufficiently for different vehicle and road types; identifying the developed or experienced to build and maintain roads, point at which significant distortions of demand occur particularly in developing countries. when road user charges contribute to general tax revenues; and equating revenue charges to variable costs for different vehicle types. Actual charges can The Policy Objectives of Road User Charges only approximate broadly a short-term marginal cost pricing structure. The paper suggests criteria for As an instrument of the central government, a public different road taxation and charging options and offers roads administration can be called upon, through its a framework for formulating an economically efficient revenue raising functions, to contribute to broader road-user charging system. national policy objectives beyond its narrower responsibility for the provision and maintenance of an Basic Concepts of Road Financing economically efficient road system. All governments need to raise revenues through The Need for Public Road Financing taxation to procure goods and services that cannot be identified with specific consumers or be charged for Roads are normally considered collective goods or through normal market mechanisms. In many countries, services demanded by the community, but which cannot especially those with poorly developed administrative be exchanged through market mechanisms since their services, taxation of road users, particularly through use by individual consumers cannot be prevented or easy to collect fuel taxes, is preferred for this purpose. measured. Toll roads are an exception, but scope for these, particularly in developing countries, is limited: A government may also choose to intervene in activities they require a high minimum traffic volume and that impose costs on society, for example, through health, safety or environmental hazards. In the transport sector it may discourage investment in obtrusive, dangerous or polluting vehicles by market correcting taxation that applies criteria conflicting with those of Ian Smith is a consultant with the World Bank strict transport cost efficiency. and is based in Surrey, U.K. Taxation is also increasingly used by governments to The paper Is edited and adapted by the SSATP control and manage national economies. Public works, from an original text submitted by the author such as new roads, may be financed with a view to reducing unemployment, resulting in investments that @ 1989, SSATP - World Bank/ECA cannot be economically justified by normal project evaluation criteria. In this case, the objective is to influence the general level of economic activity rather 41 than to achieve the optimum utilization of resources maintenance than in construction, is low. Sometimes the allocated to roads. Thus, roads administrations may find reverse occurs and roads are built to higher than themselves faced with potentially conflicting public recommended standards in anticipation of maintenance financing objectives. The question to be resolved is the neglect Road development projects are less costly in extent to which road taxes can contribute to these the longer term when based on properly conceived policy objectives without distorting resource allocation plans for capital and current spending, rather than such in the roads sector to an unacceptable degree. short-term considerations. The Purposes and Nature of Road Financing The Types and Conflicting Functions of Road User Charges Most public funds allocated to the roads sector are used to build and maintain road infrastructure. Road finan- It is sometimes possible for public authorities to charge cing may also support subsidies to transport services in directly and precisely for goods and services consumed, thinly populated rural areas and to certain categories of as in the case of water or electricity metering. Tolls passengers or investment in police patrols, weigh brid- provide the closest example in the roads sector, but ges, or traffic management schemes to prevent danger- even here charges on vehicles and the corresponding ous driving, overloading or congestion. consumption of road resources through wear and tear can only be approximately equated. ,onstruction and maintenance, however, are likely to account for a major part of roads expenditures. While Where it is not feasible or is not considered desirable this may be accounted for in part by payments to to charge consumers in this way, expenditure are private sector contractors, particularly for major road normally financed out of taxation. Taxes fall into construction projects, it may also be directed, parti- several categories of which income taxes, expenditure cularly in developing countries where local contracting taxes such as customs duties, wealth taxes, and poll industries are insufficiently experienced, to staffing and taxes are the most important. From the viewpoint of equipping the road administration's own units for cons- road user charging, the most relevant tax categories are truction and maintenance of roads by direct labor. expenditure taxes on goods and services related to road transport, and poll-type taxes on road users. Road expenditures may originate with the central government or local authorities. A division of Revenues from road user charges may exceed the finan- responsibility is often practiced, with the former cing requirements of roads if a contribution is to be financing the construction and maintenance of the major made to general taxation or fall short, necessitating a road network that carries most long-distance through- contribution from the central treasury. In either case, traffic, and the latter secondary roads for local traffic. the road user charging system should be structured so Revenues for road financing can be raised locally as as to avoid excessive distorting effects on the efficient well as centrally, but in many cases the tax base of use of roads. It should be borne in mind that the object local authorities is inadequate for this purpose and, of road user charging is not merely to raise sufficient since locally taxed vehicles frequently operate beyond revenues to cover public roads sector spending, but also the authorities' areas of jurisdiction, it is difficult to to have a "market correcting" function designed to achieve a balance between expenditures and revenues achieve an efficient allocation of resources devoted to through a road user charging system. Thus, it is roads and road transport. This, too, can be a source of common for road financing and pricing to be distortion, as when the revenue maximizing level of a concentrated at the center or, where roads are financed tax on a particular category of vehicle is less than that locally, for the national government to at least partially necessary to recover the costs it imposes on the road fund local authorities. But even centralized road network. financing cannot wholly resolve the key issue of relating road user charges to the corresponding costs of wear and tear imposed on the road system to achieve an Road Financing and Pricing efficient utilization of roads sector resources. The Economic and Sectoral Context Public financing includes capital expenditure on new, or of Road User Pricing improved assets and current expenditure, on day-to-day operations or maintenance. Often there is scope for a An appreciation of the underlying economic principles trade-off of capital against current expenditure. It is of road user charging is essential to the formulation of common practice to economize on road construction sound pricing policies and measures. It is difficult to standards and costs with the knowledge that this will analyze road financing satisfactorily in isolation from result in higher maintenance costs. This is frequently the rest of the economy; a main road improvement pro- uneconomic, merely reflecting a budget constraint, but gram might reduce public funds for schools, irrigation may make economic sense if capital is scarce or if the schemes, or other projects. If it is financed from general cost of labor, normally used more intensively in taxation, the charges incurred by road users may be 42 Ian Smith: Road Financing and Pricing in Developing Countries uneconomically low, drawing freight and passengers by vehicles is an instance of a variable (sometimes away from a railway obliged to recover its full costs, or called a "marginal"') cost, in that it would not be causing changes in the location of industry. In this incurred if there were no traffic. paper, it is assumed that the intersectoral effects of road financing are neutral, or have already been taken into In all normal circumstances road users, as a whole and account by the government's planning agency in its individually, should be charged at least the variable budget allocation to the roads sector. costs of the services they consume. If the total charges incurred by road users yield less than the costs they Road construction, administration and maintenance inflict collectively through wear and tear on the roads, account for the largest part of public roads expenditure, demand for road use will be stimulated by an effective where the complexities of pricing and the scope for subsidy, and remain at an uneconomically high level inefficient resource allocation are the greatest. But it with some operators making journeys they value at less should be remembered that a roads administration may than the economic costs imposed. But even if road user incur expenditure for other purposes such as subsidiza- revenue is sufficient to cover total variable maintenance tion of transport, or the enforcement of safety, or costs, it is important that charges be allocated diffe- environmental regulations. rentially among vehicle types according to the costs they impose. If each vehicle, irrespective of type, The level and structure of these outlays should be such incurred a uniform charge equal to average variable as to conflict as little as possible with the main resource cost, heavier vehicles with above average costs, allocating function of the road user charging system. subsidized by other road users, would undertake Passenger subsidies, for example, should not be so great journeys, the costs of which would exceed the benefits as to encourage uneconomic investment in passenger to the operators; there would be no incentive to rather than freight transport or divert passengers from substitute lighter vehicles that could reduce the road a lower cost rail service. maintenance bill. In both cases, resources would be consumed wastefully in the roads sector and withheld from alternative uses where they had more value. Basic Cost Concepts Even if charges are allocated among vehicles propor- Cost concepts are central to the whole question of road tionately to costs, they should be levied in a manner user pricing. "Costs" are, in the theoretical context, that relates them directly to the resources consumed, taken to mean "economic" or "opportunity" costs, which are a function of variable costs per km and defined as the value of the benefits that would be distance traveled. A commercial vehicle traveling, on foregone by the community on withdrawing, for the average, 36,000 km per year that imposes an average purpose in question, the necessary resources from the cost of US$2 per km on the road network should pay next most desirable use. To take a simple example, if an annual charge of US$72,000. It would be possible the size of a road maintenance brigade is increased by (and probably convenient) for the taxing agency to one man recruited from the land where the value of his collect this through an annual license fee or other agricultural output, now foregone, was US$2 per day, standing charge. But having paid it, the operator would then that is the real economic cost of his labor on the see no savings in restricting the number of his journeys; roads, even if minimum wage legislation requires him consequently, resources exceeding the value placed on to be paid US$4. their consumption could be used up. If the same total were raised by charges that varied directly with usage, Similarly, if the brigade is equipped with an additional such as fuel taxes do, a transport operator, obliged to imported truck, then its economic cost is the value meet the variable cost of each journey made, would not placed by the community on the alternative goods that normally undertake one unless it yielded greater value could have been acquired with the foreign exchange to him. used. Such costs are difficult to quantify, but it is important that the distinction between economic and No matter how efficient the method of recovering financial costs should be understood. variable costs, the question remains of financing not only the invariable element of road maintenance and A further distinction of importance to public enterprises, administration costs, but also the capital costs of new such as roads administrations responsible for major road construction. Though it is also common practice to infrastructure investments, is between "fixed" and recover these as far as possible from road users, it "variable" costs, meaning costs that remain constant should be understood that this, however administratively regardless of the level of output or usage, and those that convenient, does not necessarily contribute to the vary with it. An obvious example of a fixed (sometimes efficiency of the use of roads sector resources. If too called an "overhead" or "invariable") cost is the cost of high a proportion of the invariable costs of roads is staffing and administering a roads department depot. recovered through charging measures, transport costs The cost element attributable directly to wear and tear could increase, depressing demand and leaving a coun- 43 Ian Smith: Road Financing and Pricing in Developing Countries try without adequate transport services. An economi- roads. Aggressivity estimates are highly sensitive to cally acceptable alternative would be to recover all or small changes in the underlying parameters, and studies part of invariable road costs from the public at large, show that aggressivity, and its effects on maintenance which benefits from dependable low-cost transport, costs, range vary widely, perhaps by as much as 500 to through general taxation. A logical compromise from 1, for different vehicle types, even without allowing for the viewpoint of roads sector efficiency is to recover overloading. Given the quality of data currently fixed as well as variable costs from road users to the available, any system of road pricing based on variable extent possible without causing distortions or discou- costs can, at best, be approximate. Even if these raging demand. The balance could then be financed theoretical and conceptual difficulties could be resolved, from general tax revenues (or from a specific tax on a road pricing system based on short-run variable costs indirect beneficiaries of roads such as farmers). If all would still encounter a practical problem in that the invariable costs could be recovered from road users instruments available to road user charging agencies, without such distortion a further contribution to general particularly in developing countries, are too crude and revenues might also be feasible. imprecise to permit close links between user charges and variable costs. Even fuel taxes, which vary accor- ding to distance or road condition, correspond imper- Implementation Problems of Variable Cost Pricing fectly to road damage inflicted by different vehicle types or suffered by different road types. Although In reality it cannot reasonably be expected that practice gasoline consumption and charges incurred vary accor- can be made to accord so closely to theory. Even ding to vehicle weight and road condition, they do so leaving aside potential conflicts with other sectors or to a far lesser degree than the corresponding mainte- between different public financing goals within the nance costs imposed. transport sector, the underlying cost concepts them- selves are, in practice, difficult if not impossible to quantify. Disadvantages of Variable Cost Pricing Economic or opportunity costs, even in countries with In addition to these theoretical and practical problems good statistical data, can only be crudely estimated. It of implementation, a variable cost-based charging is not practicable and rarely worth the effort to system has other disadvantages that are felt beyond the calculate the exact value of agricultural production that road sector. If road users were to be charged only a is foregone by recruiting farm labor for road little more than the variable costs they impose rather maintenance work. Normally, an approximate adjusting than whatever price they are prepared to bear, the roads factor is applied to financial costs, generally consistent administration would have no criteria for determining with the estimated or observed use of resources when roads should be built or improved. Road users throughout the economy: the cost of unskilled labor, and shippers would not be able to signal their demand for instance, might be estimated at 50% of actual wage for new facilities by raising the price they would be payments. prepared to pay for existing limited road space or transport services. This would apply even if marginal A precise estimate of a variable or "marginal" cost cost pricing were in effect in other sectors of the depends on the time period and on the unit of output economy. In the absence of such conventional market for which it is being measured. The efficiency criterion indicators, the allocation of national investment implies that shorter- rather than longer-term variable resources among roads and other assets, and, within the costs should be the basis for road pricing. As it is roads sector, among alternative projects, would be more impracticable to keep changing user charges to reflect difficult. constantly changing short-term variable costs, compro- mise on pure marginal cost pricing is unavoidable. There is also the risk that marginal cost pricing, Practical difficulties arise in that the relative wear and notwithstanding its theoretical advantages, may prove tear or "aggressivity" imposed on different types of unacceptable in terms of social equity. If certain feeder roads can only be approximately estimated. roads serving isolated rural communities do not carry enough traffic to raise revenues sufficient to cover even Estimates and forecasts of traffic must be simplified variable maintenance costs, it may be considered into a limited number of categories. Even then the socially desirable to subsidize road transport from other average aggressivity of each category is not known with sources rather than price it out of local service. certainty, and probably varies significantly from one operating environment to another. Several studies indicate that, for bitumen roads, aggressivity varies Road Financing and Pricing in Practice proportionately to the fourth power of axle weight, but this formula only applies to roughness progression on Before discussing the implementation of the economic paved roads and is not applicable to gravel and earth principles it will be helpful to consider and clarify the 44 Ian Smith: Road Financing and Pricing in Developing Countries state's role in financing road systems. In most countries substantially reduced. This is not always easy since the total road system is too extensive to be administered national governments, and sometimes even donor and maintained wholly by the government. In Tanzania, agencies, are biased in favor of highly visible road for example, classified roads maintained by the State construction, or are not fully aware of the importance account for only 55% of the network. In some of adequate maintenance. This has contributed to the countries, roads of lesser economic or political maintenance backlog. importance-even within the classified system--are not maintained. Given this limited government capacity, the Construction, rehabilitation and maintenance standards network designated for publicly financed maintenance should be appropriate, from a cost viewpoint, to vehicle should be related to the potential level of demand for weight regulations, traffic volumes, and vehicle fleet transport services, and the country's ability to provide structure. Weight restrictions should be reviewed financial and other human resources. occasionally in relation to construction standards and, of course, enforced. The expansion of road building, often supported by international aid, during a period of relative prosperity The scope should also be assessed for adopting new followed by declining budgetary resources, has left technologies and techniques that permit the substitution many roads administrations in developing countries with of readily available domestic resources for scarcer responsibilities for networks they can no longer main- productive factors, for example, the substitution of tain, let alone develop. Resources are spread too thinly, underemployed local labor for imported capital equip- and the condition of road networks is deteriorating. It ment to economize on foreign exchange. A complica- has been estimated that less than 50% of Sub-Saharan tion arises here in that the potential savings from such Africa's road network of about one million kilometers measures are reflected in economic rather than financial is in good condition and that 25% is in such poor con- costs. As this distinction may not be perceived by a dition as to require rehabilitation. Since restoration of roads administration accustomed to working in financial networks to their former condition in the short term lies terms, close collaboration should be maintained with the beyond the capacity of roads administrations, a more planning and financial agencies to ensure that benefits selective approach is required, e.g., a scale of road of this type are identified and realized. financing priorities should be drawn up to reflect the estimated pattern of transport demand, reconstruction and maintenance costs, as well as probable budgetary Financing of Road Administrations allocations, and a phased program that emphasizes maintenance rather than new construction should be The effective implementation of road construction and formulated. maintenance programs requires an adequate and stable supply of funds to roads administrations. Where roads are financed in part by general tax revenues, programs Designation of Roads Administrations have been disrupted by unpredictable fluctuations in the flow of funds caused by economic pressure on, or inter- A second fundamental concern is where responsibilities departmental competition for, government revenues. for roads should lie. This has traditionally been regarded as a technical function and placed under the One remedy is the establishment of a road fund Ministry of Works or its equivalent. But there is a risk financed by earmarked taxes or charges, normally, but that too technical an approach may conflict with the not necessarily, on road users. This can help safeguard economic and planning considerations that form an the roads administration from dependency on the essential element of planning effective transport sector treasury, guaranteeing a degree of stability in revenues development. It is important that an agency such as a and allowing greater independence in allocating funds Ministry of Planning, concerned with the allocation of among sector needs on the basis of professional resources on a national scale, play an active part in judgment, free from the political motivation or lack of inter-sectoral coordination and the integration of road technical expertise common in central budgetary and financing into the broader economic planning frame- financing agencies. Road maintenance, which has work. suffered particularly in this respect, would be more likely to be accorded its due priority over new construction. Functions of Road Administrations On the other hand, certain disadvantages pertaining to The road administrations, however organized, should be road funds have often discouraged their adoption. They firmly committed to employing the limited resources at reduce the flexibility of government spending, prevent- its disposal in the most cost-effective manner. In ing a full response to changing patterns of demand for particular, pressure for new road construction should be public funds. Moreover, when road user taxes constitute resisted until the maintenance backlog has been an important part of general tax revenues, the remaining 45 Ian Smith: Road Financing and Pricing in Developing Countries tax base may be inadequate for a viable road fund. The Administrative efficiency: difficult to evade, with efficient use of resources within the sector may not be collection costs accounting for no more than a small guaranteed, since roads administrations may be moti- percentage of revenues. vated by narrow technical, rather than economic, considerations in planning expenditures. Even when Effects on income distribution should be politically established, a road fund is not inviolable; instances acceptable. of their suspension or "emergency borrowing" by the treasury to meet real or imaginary economic crises, can Legal attempts to avoid a tax should not result in be found in countries as different as Burundi and the uneconomic consequences, as in a high gasoline tax United Kingdom. encouraging a shift to diesel-powered vehicles. If circumstances do favor the introduction of a road The tax base should be sufficiently broad to permit fund, it is normally preferable that it be confined to the a small tax in percentage terms to generate a large financing of road maintenance. New construction is amount of revenue. better financed under separate arrangements where its economic justification can be assessed against the * Taxes should be equitable in that the beneficiaries competing claims of investments in other sectors. of the services provided are the principal taxpayers. Regular staff salaries and other unavoidable administra- tive expenditures, too, are probably best funded through Taxes should not have a marked inflationary effect. normal channels. Even within the road fund, provisions should exist for testing the economic justification of Tax yields should rise automatically with inflation. maintenance programs. Road user taxes are considered with these general Role of the Private Sector requirements in mind, as well as for their sustainability for an appropriate cost pricing system. An administration may choose to involve the private sector in road development for a number of reasons. Although this is more likely in the case of major Types of Road User Charges construction and rehabilitation projects that may lie beyond the road administration's capacity, road Fuel Tax: Taxes on gasoline and diesel fuel, an maintenance is also sometimes contracted out, important form of road user charge in most countries, particularly for periodic resurfacing and resealing meet the above criteria well. They are relatively easy to works. Sometimes private contractors (or other non- collect and can be raised at a port of entry, local governmental organizations) are engaged to complement refinery, or even as a sales tax. There is some risk that the administration's work force in reducing a heavy dependence on fuel taxes for general tax revenues may maintenance backlog, as in Zaire; and occasionally an cause inter-sectoral or inter-modal distortions; in some administration will engage local firms to maintain countries, such as Somalia and Uganda, fuel taxes have minor gravel roads, not because it lacks the resources accounted for more than three-quarters of total road to do it itself, but as part of a longer-term policy to user revenues. Another disadvantage with fuel taxes is encourage the emergence of a local contracting that they can result in the uneconomic substitution of industry. Hiring of plant from privately operated one type of fuel for another and, unless complex equipment pools offers still another possibility for exoneration arrangements are introduced, have an private sector involvement in road maintenance. impact on consumption beyond the roads sector. Fuel taxes are appropriate to a marginal price charging Taxation Criteria system in that they vary with distance, and influence the actual cost of making a journey. Fuel taxes, howe- The different taxation and charging options available in ver, are not wholly ideal for this purpose. They increase developing countries are reviewed below to assess the with vehicle use and declining road quality, but they do extent to which they can contribute to efficient resource so less than proportionately to corresponding road use in the roads sector. It is assumed that no developing damage-fuel consumption per ton-km decreases inver- country will be able to afford a pure marginal cost sely with vehicle weight while road damage increases. pricing system, and that road user taxes will be expect- There is, consequently, a tendency to either over-collect ed to raise a surplus for general tax revenues. To be from lighter vehicles and on better quality roads, or effective, taxes should be practical and feasible, given under-collect from the heavier vehicles that cause the the social and administrative circumstances of the most damage and on the lower standard roads where country concerned. Seven criteria have been suggested wear and tear is relatively high. It is necessary, there- for such taxes:2 fore, if a close approximation to a marginal cost pricing 46 Ian Smith: Road Financing and Pricing in Developing Countries structure is to be achieved, to supplement fuel tax with Non-variable Vehicle Charges: Vehicle registration other forms of road user charges. fees and licenses are non-variable in the sense that once paid, they no longer enter into an operator's decision In some countries fuel, far from being taxed, is actually whether or not to undertake a journey. As they do not subsidized with the aim of encouraging development vary with road usage they are not an effective form of through low transport cost or simply as a result of charge for a marginal cost pricing system, nor are they political pressure. But potential benefits, if any, are particularly practicable, administratively speaking, as likely to be offset by the increased maintenance and they require extensive and efficient record-keeping and operating costs resulting from the inefficient usage of must be collected from a large number of vehicle the road system. Fuel subsidization in the road sector owners, offering opportunity for evasion and corruption. should be avoided. Yet, they are widely used in developing countries. They may be levied according to vehicle characteristics such Taxes on Vehicles, Spare Parts and Tires: Other taxes as engine capacity, import price, vehicle weight, and that vary with usage are import, excise, and purchase axle weight, the latter offering the closest link with road taxes on spare parts, tires and, to a lesser extent, damage. This is a useful charge for contributing to vehicles. These taxes have some advantage over fuel invariable road costs or general government revenues taxes in countries with a high proportion of gravel and since they can be raised to whatever level the market earth roads in that vehicles and tires sustain will bear without significantly affecting subsequent road considerable wear on lower quality roads so that taxes usage decisions. imposed on their purchase reflect road usage. Vehicle parts and tire taxes correspond fairly well with the Non-user Taxes: An alternative source of road finan- criteria given above and, used in conjunction with fuel cing is taxes on indirect beneficiaries of road services tax, can be framed so as to bring road user charges or even general tax revenues. In fact, full road cost more closely into line with actual marginal costs, recovery in developing countries with comparatively perhaps by being imposed on the heavier vehicles that small vehicle fleets would have to resort to such under-contribute under a regime based exclusively on sources. Although there is no theoretical pricing fuel tax. principle involved, it might be considered desirable, in the light of social equity criteria, to raise such taxes Distance Taxes: Other usage related taxes applicable to from indirect beneficiaries rather than general tax- commercial vehicles are those levied directly on passen- payers. Two examples are a local sales tax on agricul- ger fares and freight charges, reflecting both vehicle tural produce largely induced by a road improvement or weight and distance traveled. But although such taxes a tax on local market stall holders benefitting from are related to road damage, they do not correspond improved marketing prospects. Such taxes, not being especially well with the general criteria, being costly to directly linked to road usage, are not particularly collect and open to evasion, particularly in countries appropriate in themselves for marginal cost pricing, but with weak administrative systems. Sophisticated taxes they can be used to complement a multi-part road user of this type have been used in some developed coun- charging system as a means to correct for over tries, but they are not common in developing countries. dependence on usage-linked taxes. Tolls: Tolls are an extremely flexible form of usage- related charges in that they can be differentiated Formulating an Economically Efficient according to vehicle type, journey, length and time. Road User Charging System Consequently, they are, in theory, particularly suitable for marginal cost pricing. In practice, tolls are only In most Sub-Saharan African countries, revenues from practicable under conditions of fairly heavy traffic road user charges are adequate to cover the construct- flows yielding sufficient revenues to cover the costs of ion, administration and maintenance costs of the road providing and maintaining collection and access facili- system. In some cases they yield a considerable surplus, ties. Under light traffic conditions collection costs as in Sudan, Zimbabwe and Cameroon, where they are absorb a high proportion of revenues, or tolls have to estimated to have been more than double the expendi- be raised so far above marginal costs to deter transport tures. As taxes on road users are usually relied upon by operators from making economically desirablejourneys. governments as sources of general revenue, it is not Tolls are, therefore, not common in developing always the case that the roads administration receives countries, except on some heavily trafficked roads, (as back in its budgetary allocation sufficient funds to in Mexico, Korea and the Philippines) and on some sustain a desirable level of road expenditures. More- isolated feeder roads, as in Zaire, where local circums- over, even if achieved, total cost recovery does not tances render evasion or misappropriation difficult. necessarily guarantee consistency with the marginal 47 Ian Smith: Road Financing and Pricing in Developing Countries costs pricing principle that a user should incur on each might occur if multi-axled commercial vehicles were so journey charges at least equal to the variable mainte- heavily taxed as to deter transporters from substituting nance costs imposed. There are a few instances of cons- them for road-damaging, two-axle rigid trucks. cious attempts to adopt marginal cost principles, or even market correcting taxes at all, in national road user Many countries adopt a fuel tax as the foundation of charging systems. Most tax systems have developed in their user charging structure, both for its practical a piecemeal manner, sometimes pre-dating indepen- advantages and its correlation with road damage. The dence, and, insofar as there is any rationale behind the wide base of this tax also makes it a useful source of charges, it is generally straightforward revenue raising, general tax revenues. But, in view of the tendency of a total sector cost recovery or, occasionally, a social fuel tax to either over-collect on lighter vehicles or objective such as income redistribution. under-collect on heavier vehicles, it should be set such that it reduces over-recovery. It could then be supple- In formulating a road user charging system based on mented by a charge on vehicles, tires or spare parts, marginal cost principles, account must first be taken of imposed only, or principally, on heavier vehicles to other policy goals of the existing road tax system. If, bring their total charges more closely into line with for example, the government decides that road user their high marginal costs. But as under-recovery would charges should cover total roads sector expenditures and still tend to emerge with increasing vehicle weight at contribute to general tax revenues without undue distor- the upper end of the range, vehicle registration fees tion of demand, then these objectives should be regar- bearing relatively heavily on these larger vehicles could ded as constraints determining the extent to which be used as a further complementary pricing measure. marginal cost pricing or other market correcting Although not distance related, the incidence and level principles can be incorporated within the tax structure. of registration fees can be finely ordered so as to Political and administrative factors should also be redress, in average terms, the discrepancy between the considered. If, for example, record data is insufficient charges and marginal costs of the heaviest vehicle or adequate supervision is impracticable, then it would classes. Also, as mentioned earlier, their neutral effect be unwise to introduce a distance tax on passengers and on shorter term usage, once they are paid, enables them freight however theoretically attractive. Similarly, it to contribute effectively to general revenues, particu- may not be politically feasible to effect, as least in a larly at the local government level. single phase, the tax increase desirable for a marginal cost pricing system. Finally, transport coordinating This general approach is illustrated schematically in requirements should be kept in mind; it would not, for Figure 1, which shows the general relationship these instance, be economic to reduce a user charge to secure principles would establish between short-run marginal more efficient use of a low marginal-cost road if it costs and road user revenues on a given road network. would have the effect of diverting traffic from a railway The diagram shows how total taxes levied on each offering even lower cost transport. In short, a second- vehicle type correspond to the short-run marginal costs, best solution, featuring at least some of the benefits of that is maintenance costs, imposed on the road network. marginal cost pricing, may have to be accepted in view In this illustration, revenues exceed costs in most cases. of other policy goals, and of political and administrative But the extent to which these surpluses will collectively constraints. exceed the corresponding shortfalls, yielding a contri- bution to invariable road costs and/or general tax Subject to these constraints, the general approach that revenues, will depend on the composition of the vehicle might be taken by a developing country wishing to fleet. It should be appreciated, however, that the most restructure its road user charging system and obtain appropriate structure and level of charges for develop- some of the benefits of marginal cost pricing, would be ing a country will depend on national circumstances, as follows. First, for reasons of internal financial including the extent and condition of the road network, discipline and the limited choice of taxation sources, composition of the vehicle fleet, elasticity of demand a contribution from road users to fixed road costs and for road transport, and that it is unlikely that any two general tax taxation would probably remain necessary. countries have the same optimum road pricing structure. But this should be raised only to the extent that the The system outlined above for recovering road mainte- pattern of traffic usage is not distorted too far from that nance costs in an economically efficient manner should, which would have resulted under a pure short-run therefore, be regarded as a general guide to be changed marginal cost pricing policy. This type of distortion or modified as local conditions require. Endnotes: 1. The concept of a "marginal cost" is rather more complex so it should not be regarded as always interchangeable with "variable cost." 2. See "Interim Guidelines on Road User Taxation" IBRD. Transportation Department. November 5, 1986. Table 1. 48 Ian Smith: Road Financing and Pricing in Developing Countries Figure 1: Specimen Structure of Road User Charging System O ] Surplus of charges over costs (Available for contributions to invariable costs and general tax revenues after off-setting corresponding shortfalls of charges below costs) Vehicle Shortfall of charges below costs Reistration Taxes on Vehicles, Tires, Spare Parts o Road user tax 0 Fuel Tax Short run variable costs Vehicle Type 49 Asif Faiz Planning, Programming, and Budgeting for Road Maintenance Summary activities, the wide span of management control, and structured delegation of authority from the maintenance The rapid expansion and upgrading of road networks in headquarters at the apex to the maintenance crew at the the 1970s in Sub-Saharan countries have not been lowest level of control, suggest that the programming matched with a commensurate increase in maintenance and budgeting system supporting road maintenance budgets and institutional capacities. Road damage has management should have the following attributes: escalated well beyond the maintenance capacity of most highway agencies. Corrective measures require new it should be based on physical monitoring and skills, technologies, and management processes invol- evaluation of the entire road network; ving a sharp departure from traditional practices. In many road agencies, maintenance decisions are based it should have a multi-year horizon; and on sources of information that are quite variable and often inconsistent. As a result, road agencies are unable it should unify all maintenance operations ranging to document the overall condition of their road systems, from routine maintenance to rehabilitation under a nor are they able to provide a defensible justification common system of resource allocation. for their maintenance budget requests or render an acceptable accounting of the public funds expended on The development of a maintenance program and the road maintenance and the results achieved. accompanying budget requires an estimate of the maintenance work needed during the budget period and the cost of performing that work. While several Planning and Managing Public approaches have been used to obtain these two items, Expenditure on Roads a defensible maintenance program and budget must be based on reliable information on road conditions, Planning, programming, and budgeting (PPB) are the traffic, and the cost of maintenance operations. basic processes for allocating, scheduling, spending, and controlling public funds for road development and A number of management systems are available to pro- maintenance programs. The PPB process involves inten- vide factual information and criteria (performance and sive inter-agency interaction and coordination, with quantity standards), and a systematic approach to the planning and budgeting functions managed by core effective programming, management, and application of ministries such as finance and planning. The program- road maintenance resources. Management systems, ming activity is the only part of the PIPB process supported by effective information databases, have directly managed and controlled by the road agency resulted in 5-15% savings in the annual budgets of road and hence is of critical importance in the rational agencies. The main objective of these systems is to application of road expenditures. The physical output of facilitate the processing and analysis of information programming is a road development and maintenance for decision-making and management control. This program that can be a powerful management tool for objective can also be achieved with simple techniques phasing new projects, monitoring ongoing projects and (e.g., visual surveys and assessments) and manual activities, identifying a program slice for the annual record keeping, provided that information is collected budget, adjusting spending priorities under budget and processed diligently and systematically. constraints, and providing factual information for preparing and monitoring the development plan and the In many road agencies, maintenance decisions are based budget. The spatially dispersed nature of maintenance on information that is variable and often inconsistent. As a result, road agencies are unable to document the overall condition of their road systems, justify their maintenance budget requests, or render an accounting Asif Faiz Is Transport Operations Ad%iser of the public funds expended on road maintenance and with the World Bank, Washington D.C. the results achieved. With increasing pressures to control public spending, road agencies are being @ 1989, SSATP - World Bank/ECA required to provide defensible and consistent justifications for their spending programs. 50 Asif Faiz: Planning, Programming and Budgeting for Road Maintenance Budgeting for Road Maintenance enhanced by establishing a maintenance budget review committee consisting of the chief maintenance engineer, The main objective of the budget is to provide a mean- a few district engineers representing field personnel, ingful and operational framework for accountability, and one or more representatives of the planning and while allowing for sufficient flexibility in the finance ministries. application of allocated funds. Ideally, the budget should be viewed as a contract committing the road Proposed expenditures by the road agency must be jus- agency to produce a quantum of work outputs for the tified. This entails estimating the value of the capital financial resources it receives from the government. represented by road network and the costs borne by the The budget should spell out the obligations and road users. The consequences of insufficient mainte- responsibilities of each party so there is a clear basis nance must be explained in terms of the deterioration of for auditing and assessing budget performance. There the road network, the eventual costs of deferred mainte- are three types of road maintenance budgets in common nance, and the higher costs sustained by road users. use: line-item, lump-sum, and program. Major maintenance activities such as periodic resur- facing, strengthening and rehabilitation should be Experience suggests that program/performance-type supported by quantified economic justification for each budgets are best suited for road maintenance programs, project or road link. Routine maintenance operations as they are relatively simple to implement and strike an should be based on standards and levels of service deri- appropriate balance between the accountability and ved from cost-effectiveness analysis. flexibility objectives of budgeting. A program budget also provides a basis for a "contract" between the There is generally no organized constituency to support government and the road agency that links funds alloca- or endorse the road maintenance program. The road tion and physical outputs. The main caution in the use agency should work with the media and potential of this type of budget is to restrict maintenance interest groups (e.g., professional and trade associations activities or work items included in the budget to a of contractors and transporters) to make the political manageable number. Otherwise the budget exercise can leadership and the public aware of the effects and costs become complicated, costly and time-consuming. As of failing to maintain the roads. with many other physical processes, about 20% of maintenance activities account for over 80% of the maintenance resources, and these key maintenance Classification of Road Expenditures operations should be the focus of program budgets. Many countries have separate budgets for current and Maintenance by contract simplifies the use of program capital expenditures on roads with new road budgets, since a direct link is established between investments covered by the capital budget and maintenance expenditures and physical outputs. Future maintenance under the current budget. The existence of maintenance cost estimates can be reliably prepared by two budgets is generally institutionalized in two budget- the analysis of bids and completed maintenance con- making bodies-Ministries of Finance often are tracts. Contract maintenance also provides considerable responsible for current budgets while Ministries of flexibility in adjusting maintenance programs in the Planning are in charge of capital budgets. Lack of face of budget cuts, as there are fewer resources tied up coordination between the two has often led to in components such as permanent labor and equipment, inefficiencies in the allocation of resources to the road which tend to drive the scope and frequency of mainte- agency. Road construction and betterment programs are nance operations. Contract maintenance, however, often fully funded in the capital budget while requires a multi-year programming and budgeting cycle maintenance operations remain under-funded because of to ensure a steady flow of work for private contractors statutory ceilings on current expenditures. Where the and to avoid delays in payment for completed work. If two budgets are overseen by separate ministries, it budget preparation is not based on a maintenance becomes almost impossible to reallocate funds from management system, it should be formulated on the new construction to maintenance and rehabilitation. basis of: Even where the management of the two budgets is unified under a single government agency, the rigidities inspection of roads, facilities, and equipment; of a dual budgeting system render such a reallocation difficult. * the previous year's expenditure by major mainte- nance activities and past experience; and Incorporating certain road maintenance activities into the capital budget would help to reduce the bias toward * assessment of changed conditions such as adjust- investment in physical capital (new construction) at the ments in road inventory. expense of current operations and maintenance. For example, resurfacing (periodic maintenance) and rehabi- The budget preparation process can be significantly litation of worn-out roads could reasonably be classed 51 Asif Faiz: Planning, Programming and Budgeting for Road Maintenance as capital rather than current expenditure. Planners however, slow the implementation of maintenance might then pay more attention to the need to maintain programs and adversely affect the morale, staffing, and older roads and assess the future maintenance require- managerial capabilities of road maintenance organiza- ments of new construction projects. The budgetary tions. Funding uncertainties play havoc with operations constraints on rehabilitation would also be less rigid. that cannot be uniformly programmed over the budget Such a reclassification should also be helpful in year because of a well-defined construction season. The reorienting the programs of external aid agencies. A release of maintenance funds by central ministries can more effective proposition would be to integrate capital be considerably streamlined if the road agency prepares and current budgets in a unified road budget and to reliable forecasts of its spending requirements. select maintenance, rehabilitation and new construction projects on the basis of their economic worth. Whether The assurance of a steady and reliable flow of funds for unitary or dual, the budget should be comprehensive. It maintenance programs is often used as an argument for should include all spending on roads whether financed special earmarked funds for roads. A road fund can by general taxes, earmarked sources of revenue, bor- ensure a steady source of funding for critical mainte- rowing or grants. Regardless of how road expenditures nance services and provide protection against unreliable are classified, effective coordination between central disbursement procedures. ministries (finance and planning) and the road agency is essential to ensure adequate allocation and control of public funds for road construction and maintenance Program Adjustment under Budget Constraints programs. Budgetary shortfalls can make even a realistically planned road maintenance program obsolete, as funding Integrating Donor-funded Projects for various categories of maintenance expenditures may into the PPB Process fall below the minimum effective level. The problem may be further exacerbated if much of the budget goes Donors finance a large portion of road investment toward the wages of a large labor force. A small cut budgets in many sub-Saharan countries and their reluct- can bring much of the agency's work to a standstill if, ance to fund current maintenance expenditures tends to for example, it implies that the agency cannot buy fuel complicate policymaking in the roads sector. In many or spare parts. Even when funds have been appropriated countries donors deal directly with the road agencies, for maintenance, political or private interests can thus diluting the central control of the budget. Lack of pressure road authorities (or their financial sources) to a central perspective makes tradeoffs between road divert funds. For these reasons setting priorities and investments and maintenance difficult to assess and developing contingency plans should be a part of the overall spending on roads difficult to contain. In some budgeting exercise. This can be accomplished in part by cases counterpart funds may be separated from the formulating a "core" maintenance program consisting of budget to support various donor-supported investment a group of roads and activities that should receive projects, leaving fewer resources for the road agency's funding under all circumstances together with a list of maintenance programs. activities to be funded as additional resources become available. The practice of "across-the-board" cuts or Besides the need for change in donor policies on partially funding all maintenance activities should be funding maintenance expenditures, all foreign aid for abandoned. road programs should be incorporated in the central budget. Donor projects should be subject to the same standard of central review as domestically-financed road Program Review and Evaluation projects, with full attention paid to recurrent funding requirements. Donor activities should be incorporated It is a common legal requirement that public expendi- into the normal programming and budgeting cycle so tures on roads be subject to financial audits. Such audits that availability of donor funding does not distort the mostly examine if funds were spent as authorized and spending priorities in the roads sector. This calls for put little emphasis on the value obtained from the more effective coordination of aid programs in the public spending on roads. Periodic reviews of road roads sector by borrower governments and their road maintenance programs should ensure an adequate link agencies. between physical and financial progress. A further objective of performance audits should be to relate financial flows and maintenance performance indicators Release of Funds to the state of the roads. Periodic reviews should be supplemented by a comprehensive retrospective evalua- To cope with uncertainties and budgetary shortages, tion reported annually in a public document. Such an central ministries often slow the release of funds to evaluation should include an analysis of the objectives spending agencies. Such indirect forms of control, of each road maintenance activity, the progress made in 52 Asif Faiz: Planning, Programming and Budgeting for Road Maintenance achieving these objectives, and an assessment of the and consistent justification for their spending programs. benefits derived from maintenance activities. Traditional approaches to road planning, programming and budgeting (PPB) have focused mainly on new cons- truction projects, relegating maintenance to a residual Introduction activity. This bias is still evident in the road expen- ditures. Based on a sample of 19 Sub-Saharan countries The rapid expansion and upgrading of road networks in (Table 2), a number of countries mainly in Western the 1960s and 1970s (Table 1) has outstripped the Africa (Benin, Ghana, Nigeria and Togo), now recogni- maintenance budgets and institutional capacities of most ze the need to increase allocations for maintenance and countries in Sub-Saharan Africa. This road construction rehabilitation. For the 26 countries for which 1986-1988 boom has doubled the paved road length since 1971, data are available new construction and upgrading and in some countries has resulted in networks with a (excluding rehabilitation) accounted for 46% of road skewed age distribution, which concentrates major expenditures in Eastern and Southern Africa in 1987-88, maintenance and strengthening requirements in cyclical compared to about 36% in Western Africa. periods, requiring a manifold increase in maintenance outlays. Deterioration of paved roads is gradual and The increasing complexity and scope of maintenance barely perceptible during a long initial phase that can operations has blurred the distinction between last up to two-thirds of the pavement's life cycle. This construction and maintenance activities. Maintenance is followed by a rapidly escalating rate of deterioration can no longer be treated as a residual activity. leading to structural failure. Hence, resurfacing and Programming and budgeting practices for road expen- strengthening requirements cannot be assessed accura- ditures must be overhauled so that road budgets bear tely and programmed without a systematic procedure some semblance to physical requirements and mainte- for pavement monitoring and evaluation (World Bank, nance is accorded priority in budget allocations. The 1988 b). Traffic has also become much heavier than financial stakes are high-the restoration backlog alone expected and axle-loadings have exceeded the design is US$5.0 billion to rectify the past neglect of road capacity of pavements. Maintenance operations such as maintenance in Sub-Saharan Africa (23% of paved pavement resurfacing, strengthening, and rehabilitation roads and 39% of unpaved roads in poor condition) and can be as costly and technically complex as new road another US$1.2 billion is needed annually for resur- construction. Corrective measures therefore require new facing, strengthening and routine maintenance to skills, technologies, and management processes invol- prevent deterioration of the remaining network. ving a radical departure from traditional practices. The planning, programming, and budgeting process With increasing pressures to control public spending, for road maintenance programs appears simple, but road agencies are being required to provide a defensible its implementation raises a number of policy and Table 1. EVOLUTION OF SUB-SAHARAN ROAD NETWORKS al 1971 (km) 1987 (kn) Total Road Paved Total Road Paved Network Network Network Network Eastern and Southern Africa 367,800 22,400 503,000 42,400 Western Africa 341,300 30,700 430,900 67,000 Sub-Saharan Africa 719,100 53,100 933,900 109,400 a/ Excluding Comoros; Djibouti, Mozambique and Zimbabwe for which 1971 data were not available. 53 Asif Faik: Planning, Programming and Budgeting for Road Maintenance Table 2. DISTRIBUTION OF ROAD EXPENDITURES: CONSTRUCTION VS. MAINTENANCE (19 Sub-Saharan Countries) Percent Distribution of Road Expenditures 1981-82 1986-88 New Constmuction/Inprovements 66% 58% Reconstruction and Rehabilitation 13% 17% Resurfacing and Routine Maintenance 20% 25% operational issues. The purpose of this paper is to years. The first year program becomes the basis for the identify some of these issues and explore options for budget and includes projects and activities with specific improving the programming and budgeting processes designs and detailed cost estimates. The second year for road maintenance, including the use of management program includes projects and operations at the design systems and related analytical tools. The planning stage for inclusion in the following year's budget. The techniques for road programs are fairly well established programs for the third and subsequent years identify the and are not covered in this paper. Although budgeting scope, design requirements, and estimated costs of involves both revenue and expenditure, this paper deals planned expenditures. The program for each year should mainly with the expenditure. include separate estimates of investment and mainte- nance requirements for the road system. Compared to periodic updating of the medium-term plan (commonly Basic Concepts a 4 or 5 year cycle) as part of a larger national planning exercise, the multi-year rolling program should be Planning, programming, and budgeting are the basic updated annually by the highway agency in conjunction processes for allocating, scheduling, spending, and with the annual budget exercise. controlling public funds for road development and maintenance programs. The medium-term plan (4-5 The budget is the authoritative legal document outlining years) identifies sector development goals and object- the amount of money allocated for a specified time ives, evaluates spending categories and alternatives, sets period to the road agency to spend on activities and the phasing of major capital investments over several functions for which it is responsible. The main purpose years, and assesses the sustainability of planned expen- of the budget is to allocate resources to various ditures and revenues over the plan period. In some activities and provide a basis for control. The mainte- countries, the medium-term plan is supplemented (and nance budget is that portion of the road agency's in some instances substituted) by annual plans to permit budget that includes funds for maintaining roads, greater flexibility in addressing short-term problems bridges, appurtenances, roadside, maintenance stations and to achieve greater synchronization with the annual and equipment, traffic services, rest areas and other budget. facilities and services. As shown in Exhibit 1, the PPB process involves intensive inter-agency interaction and Programming translates the medium-term plan into a coordination. The central planning office/ministry is multi-year program of discrete projects and activities commonly responsible for the economic development based on an assessment of expected resources and the plan and for approving the development budget, while absorptive capacity of the implementation agency. In ministry of finance/office of the budget manages the case of road programs, this requires projections of the current budget and controls all expenditures. The future physical and operational conditions and needs of programming activity is the only part of the PPB the road system, establishment of spending priorities, process directly managed and controlled by the road and their phasing over a rolling three to five year agency and hence is of critical importance in the period. Programs are quite specific for the first two rational application of road expenditures. 54 Asif Faiz: Planning, Programming and Budgeting for Road Maintenance Exhibit 1 - THE PPB PROCESS (An idealized framework for the PPB process is shown in Exhibit 2). The spatially dispersed nature of maintenance activities, the wide span of management control, and structured delegation of authority from the maintenance headquarters at the apex to the mainte- nance crew at the lowest level of control, suggest that the PPB system supporting road maintenance manage- ment should have the following attributes: * it should be based on physical monitoring and eva- luation of the entire road network Ministry of Planning Road Agency Ministry of Finance * it should have a multi-year horizon * it should unify all maintenance operations ranging from routine maintenance to rehabilitation under a common system of resource allocation. The physical output of programming is a Road Devel- Basic Information Requirements opment and Maintenance Program that serves as a management tool for phasing new projects, monitoring The development of a maintenance program and the ongoing projects and activities, identifying a program accompanying budget requires an estimate of the slice for the annual budget, adjusting spending priorities maintenance work needed during the budget period and to meet budget constraints, and providing factual infor- the estimated cost of performing that work. While mation for preparing and monitoring the development several approaches have been used to generate these plan and the budget. estimates, the preparation of a defensible maintenance program and budget requires three basic elements: Many road agencies perceive their role as an imple- mentation agency responsible for executing programs a link-by-link assessment of the condition of and budgets given to them by core ministries such as the road network and identification of major finance and planning. Planning and budgeting are deficiencies. perceived as two distinctly different activities under traffic distribution on the road network by volume separate departments with little or no interaction. The planning effort is focused on physical planning and and type of traffic. design and budgeting is perceived mostly as a cost unit cost estimates for the main categories of accounting exercise for controlling expenditures and maintenance operations including pavement resurfa- justifying budget requests. Such road agencies are cing and routine maintenance, strengthening, rehabi- generally unable to make a convincing case for their litation, and reconstruction works. programs and bear the brunt of budget cuts. For effec- tive management of road expenditures, planning, programming and budgeting must be seen as an integra- Exhibit 2. AN IDEALIZED FRAMEWORK ted process with programming providing the bridge FOR PLANNING, PROGRAMMING AND between financial expenditures and physical outputs. BUDGETING FOR ROAD MAINTENANCE An Operational Framework for Road Maintenance, Planning, Exhibit 2. An idealzed Framework for Planning, Programming and Budgeting Programming and Budgeting for Road Maintenance SI(State of the Road Network Road maintenance planning and budgeting consists of hysal Condition and Trafic) the following essential procedures (FHWA, 1985): s Physical Needs * defining objectives and constraints (Routine Maitnanc, Resrfad St thening, * assessing conditions and needs Resource Requirements (Manpower, Equipment, Materials, Contractual Services) * specifying work activities and standards n (Budget) * developing annual work programs and budgets 55 Asif Faiz: Planning, Programming and Budgeting for Road Maintenance The condition assessment provides an inventory of A number of systems are available to provide factual maintenance elements and an estimate of the mainte- information and criteria (performance and quantity nance workload. The traffic data provide a key input standards) for systematic approaches to the effective the selection of appropriate maintenance policies and management and application of road maintenance for prioritizing maintenance operations. Reliable unit resources. Management systems can add greatly to costs permit the translation of the maintenance overall maintenance efficiency, resulting in a 5% to workload into a working budget. It is, however, not 15% savings in the annual budgets of road agencies uncommon to find maintenance budgets assembled by (FHWA, 1985). Management systems, however, tend to multiplying aggregate road lengths (undifferentiated by address specific elements (e.g., pavements, bridges, traffic or condition) by unit costs of maintenance opera- equipment, maintenance) of the road management tions derived from largely theoretical desk exercises. spectrum and have overlapping attributes. Generally, Such a budget bears no resemblance to actual needs; it they are not integrated into a comprehensive road cannot be defended before decision-makers and is of no management system with appropriate information and value in providing guidance to maintenance managers feedback linkages between the various sub-systems. in the field. Reliable information on road conditions, traffic, and the cost of maintenance operations, and its The management systems commonly in use in road regular updating through periodic surveys, are critical agencies to support the PPB process can be grouped in terms of establishing realistic maintenance programs into a hierarchy based on the object of management as and budgets. Without this information, programming shown in Table 3. These management systems have and budgeting becomes a sterile academic exercise, common information requirements (e.g., a geographic irrespective of the sophisticated procedures and models location system) and overlapping attributes (e.g., a involved. features or asset inventory). A major challenge for road agencies is to: Management Information Systems for PPB - consolidate the information needs of various mana- gement systems into a common information system A "management information system" (MIS) provides for road management; information for determining the condition/status of assets, processes or activities and for making mana- * integrate the plethora of management systems into gement decisions. MIS is a sub-set of a management the organizational structure of the road agency as system and provides information to support various these systems often transcend the traditional orga- components of the management system. Most of the nizational divisions based on functional respon- developments in MIS are a by-product of the advances sibilities (e.g., planning, design, construction and in micro-computer technology. (FHWA, 1985). maintenance); Table 3. RELATIONSHIP OF ROAD MANAGEMENT SYSTEMS TO PPB Object of Management Activities Information used for PPB A major component of Pavement Management, Multi-year and annual the Road System Bridge Management, maintenance work programs Roadside Management, and budgets Traffic Systems Management A major operational Construction Management, Annual budgets, organizing, function or activity Maintenance Management scheduling and controlling performed on the Road maintenance operations System A factor input needed Equipment Management, Procurement of equipment, for an operational Personnel Management, personnel and materials needed function or activity Materials Supply and for multi-year programs and Logistics Management related expenditures in the annual budget 56 Asif Faiz: Planning, Programming and Budgeting for Road Maintenance consolidate the enormous amounts of data generated in common use: line-item, lump-sum, and program (see by decentralized organizational units into inform- Exhibit 3 for examples). In addition, Zero-based ation suitable for central management control and Budgeting (ZBB) has been used as a tool for budget decision-making; justification. mobilize the support and cooperation of field personnel in the introduction and operation of these Line-Item (Object of Expenditure) Budget management systems as they constitute an added administrative burden, often require the learning of In this type of budget, maintenance allocations are new skills (computer technology), and are perceived determined on the basis of money instead of work to be as job-threatening; and accomplished. The budget lists proposed expenditures by basic items of expense: payroll, supplies and mate- establish a linkage between these operational rials, equipment and, to some extent, contracted servi- management systems and financial accounting and ces. These amounts are sometimes listed separately control procedures and systems. under several activities to ensure availability of funds for specific services such as pavement marking, vegeta- It is beyond the scope of this paper to attempt to tion control, and rest area maintenance. With a line- discuss these issues. Suffice it to state that Dvement item budget, the funds are used on basis of individual and bridge management systems are e!entially judgement instead of work objectives or comparative programming tools-they provide informat,on on dhe levels of service. Work decisions, for the most part, are state of roads and bridges and strategies for network- made by the lowest level of supervisors and budget level programs and specific projects (resurfacing, expenditures are not related to work outputs. Line-item strengthening, rehabilitation and reconstruction) within budgets can be highly restrictive and offer little flexi- the program. Construction and maintenance manage- bility. For example, the allotment for any line item ment systems are used to plan, budget, and schedule (such as materials) may not be exceeded even if there maintenance and construction activities. These systems is an excess of funds in another line-item (e.g., equip- provide the cost information for construction and ment). This type of budget does offer some advantages maintenance operations and estimates of workload in that it is easy to prepare as it requires simple requirements for scheduling. They include cost control projections of historic expenditure patterns and a known and performance audit mechanisms and interface with labor force. It is also easy to administer since the central financial control and audit procedures. budget items are the same as the expense items incurred Equipment management and other related systems are during budget execution. aimed to maximize the productivity of equipment and other inputs (labor, materials) required for maintenance Program/Performance Budget operations. The main objective of these systems is to facilitate the processing and analysis of information for The development of maintenance management systems decision-making and management control. This and cost accounting procedures has led to changes in objective can be achieved equally weh with simple budget approaches. The program or performance budget techniques (e.g., visual surveys and assessments) and (see Exhibit 4 for example) is based on detailed work manual record keeping, provided that the information is programs broken down into activities (e.g., crack collected and processed diligently and systematically. A sealing, pothole patching, surface treatments, overlays), simple but effective pavement management system is with predetermined estimates of work for each activity. described in the Niger Case Study. The program budget defines the amount of work that is planned and expected to be performed. Senior manage- ment makes the decisions on the levels of service and Budgeting Systems for Road Maintenance work methods. This budget not only indicates what is to be accomplished but also what it will cost. It can The main objective of the budget is to provide a mean- also be used to demonstrate what will not be accom- ingful and operational framework for accountability, plished if the budget is significantly reduced. Some while allowing for sufficient flexibility in the program budgets specify allocations for each major application of allocated funds. The budget should be activity such as surface treatments. While expenditures viewed as a contract between the road agency and the may not exceed the allocations for specific activities, government, with the road agency committed to the program budget offers considerable flexibility in produce a quantum of work outputs for the financial the use of component resources (labor, equipment, resources it receives from the government. The budget materials), which are not appropriated by each object of should spell out the obligations and responsibilities of expenditure as in a line-item budget. The program each party so that there is a clear basis for auditing and budget offers the best balance between the flexibility assessing budget performance at the end of the fiscal and accountability principles underlying maintenance year. There are thee types of road maintenance budgets budgeting. 57 Asif Faiz: Planning, Programming and Budgeting for Road Maintenance Exhibit 3. TYPE OF ROAD MAINTENANCE BUDGETS A. LINE-ITEM BUDGET SUMMARY Fund: GENERAL Department: HIGHWAYS ACTIVITY: ROAD MAINTENANCE CLASSIFICATION ACTUAL 1982 BUDGET 1983 BUDGET 1984 Personal Services 65,429.18 83,198.00 87,927.00 Contractual Services 6,312.18 7,000.00 7,500.00 Commodities 4,450.02 3,540.00 4,450.00 Other Charges 19,946.15 22,000.00 26,500.00 Gross Expenditures 96,137.53 115,738.00 126,377.00 Reduction of Costs 62 2,500.00 2500.00 Net Expenditures 95,007.91 113,238.00 123,877.00 B. PERFORMANCE BUDGET SUMMARY BUDGET REPORT Fiscal Year: 1982 Department: HIGHWAYS Activity: ROAD MAINTENANCE ACTIVITY WORK AND COST No. Description In-House Contract Total 1101 Spot Premix Patching Work 8050.00 0 8050.00 Units: Sq. Feet Cost 33,407.50 0 33,407.50 1103 Recycle Asphalt Ptch Work 2010.00 500.00 2510.00 Units: Sq. Feet Cost 10271.10 2485.00 1 1100 Roadway Maintenance Cost 43,678.60 2485.00 46,163.60 3201 Roadway Mowing Work 873.00 315.00 1188.00 Units: Swath Mi Cost 3,622.95 1332.45 4955.40 3204 Litter Pickup Work 375.00 0 375.00 Units: Man Hrs. Cost 5350 0 5632.50 3200 Roadside Services Cost 9 5 1,2.45 1 Total All Activities Cost 52,934.05 3,817.45 56,751.50 3s,632 2,53.09 38,256.1 88,617.37 6390.54 95,007.91 C. LUMP-SUM BUDGET RECURRENT BUDGET ESTIMATE ACTUAL REVISED EST. EST. CODE SUBJECT 1982 1983 1984 000314 Maintenance of Highways 95007.91 113,238.00 123,877.00 Source: Adapted from American Public Works Association, Street and Highway Maintenance Manual. Washington, D.C. (1985). 58 Asif Faiz: Planning, Programming and Budgeting for Road Maintenance Lump-Sum Budget tied up in non-fungible factor components such as permanent labor and equipment, which otherwise tend With this type of budget, funds are appropriated in one to drive the scope and frequency of maintenance lump sum for maintenance purposes and appear as a operations. Contract maintenance, however, requires a single-line item. Although this budget allows the multi-year programming and budgeting cycle to ensure greatest flexibility, budget preparation must be based a steady flow of work for private contractors and to on a sound physical program and performance closely avoid delays in payment for completed work. scrutinized to ensure accountability. The use of a lump- sum budget should be predicated on the presence of an advanced maintenance programming and evaluation capability. Classification of Road Expenditures The most important distinction in road budgets is the Other Budgetary Systems separation between current and capital transactions. Some countries have separate budgets for current and Two other budgetary systems have been used in public capital expenditures on roads. Dual budgets originated works programs. These include the Planning, in the 1930s with the idea that the current budget Programming and Budgetary System (PPBS) introduced (covering current expenditures) was to be financed by in the U.S. Department of Defense in the 1960s and the taxation and the capital budget (covering the acquisition Zero-Based Budgeting (ZBB) introduced in the U.S. of new assets that would generate returns in the future federal government in 1977 to screen out the historic by borrowing and other capital revenues. This distinct- continuation of unneeded programs. Both these systems ion is based on the premise that borrowing to fund involve complex goal-setting exercises and focus on consumption is not acceptable. There are several processes rather than results. Neither has proved an variants on the current/capital theme: recurring and effective budgetary system for road maintenance. nonrecurring, ordinary and extraordinary, revenue and Experience suggests that program/performance-type capital, current and investment, above and below the budgets are best suited for road maintenance programs, line, and development and maintenance budgets (Prem- as they are relatively simple to implement and strike an chand, 1983). Implementation of development plans has appropriate balance between the accountability and led to a frequent association of new road investments flexibility objectives of budgeting. Furthermore, a with the capital budget and maintenance with the program budget provides a basis for establishing a current budget. The existence of two budgets is gene- "contract" between the government and the road agency rally institutionalized in two budget-making bodies- by providing a linkage between allocation of funds and Ministries of Finance often are responsible for current physical outputs. The main caution in the use of this budgets while Ministries of Planning are in charge of type of budget is to restrict maintenance activities or capital budgets. Lack of coordination between the two work items included in the budget to a manageable has often led to inefficiencies in the allocation of number. Otherwise the budget exercise can become resources to the road agency. Thus, it is not unusual for complicated, costly, and time-consuming. As with many road construction and betterment programs to be fully other physical processes, about 20% of maintenance funded in the capital budget whereas maintenance activities account for over 80% of the maintenance operations remain underfunded because of statutory resources and these key maintenance operations should ceilings on current expenditures. Where the two budgets be the focus of program budgets. Where labor redun- are overseen by separate ministries, it becomes almost dancy is an issue, program budgets may be reinforced impossible to reallocate funds from new construction to by numerical limits on the labor force that the road maintenance and rehabilitation. Even where the mana- agency may hire. This option may raise costs if there gement of the two budgets is unified under a single are cyclical peaks in the maintenance work load. government agency, the rigidities of a dual budgeting system render such a reallocation difficult. Maintenance by contract simplifies the use of program budgets, since a direct link is established between Road expenditures in Mauritius (Table 4) clearly show maintenance expenditures and physical outputs. The the problems associated with dual budgets. The growing intermediate step of estimating factor inputs (labor, imbalance between capital and current expenditures equipment, materials) can be dispensed with except for between 1983/84 and 1987/88 is readily apparent, with establishing initial base contract rates and periodic expenditures on maintenance stagnating over the five- checks on contract bids. Future maintenance cost year period. It is interesting to note that the distribution estimates can be reliably prepared using information of budgetary resources between periodic and routine from analysis of bids and completed maintenance maintenance within the current budget appears quite contracts. Contract maintenance also provides consi- reasonable. Only in the broader context of overall road derable flexibility in adjusting maintenance programs in expenditures does the imbalance between investments the face of budget cuts, as there are fewer resources and maintenance become apparent. 59 Exhibit 4. MAINTENANCE PERFORMANCE BUDGET SUMMARIES A. Maintenance District Level WORK PROGRAM OBJECT OF EXPENDITURE CONTRACTUAL QQQ MAINTENANCE ACTIVITY IN WORK UNITS INY.S L|BOR ECUIPMENI MA[EILSk SERVICES. ETC TOTAL BUDGET $ S $ S $ ROADWAY SURFACE 101 Patti with premx 750 tons mix 600 14400 2.400 4,500 21,300 102 Level with premix 6,000 tons m'x 392 9,410 7.230 25.970 53,610 103 Deep patch with 1,500 Ions mix 275 6,600 7,760 8,990 23,250 199 Other roadway 1500 1,500 26.000 19,570 6,210 61,780 surface activities man days SUBA-TOTAL ROADWAY 15,548 373,160 229,110 290.560 43.200 936,050 SHOULDERS AND SIDE AROA AYSFC 201 Slade/Reshape 7,200 shouider 1.800 43.200 99,200 1,520 144.000 wit/w1thout m-les adding matenal 202 Patch with aggregate 9.000 average 220 5,280 5,160 10,600 - 21.040 or stabilized matenial yards ground 299 Other shoulder actvities 900 man days 900 21,200 11,980 9,610 43.190 901 Employment Servles 3.200 vehiceas 400 9600 540 -10140 and repair 951 Feld Supervion 6.000 man days 6,000 144,000 36000 - 10.000 952 Laborers 9.200 man days 91000 220,800 220.800 DISTRICT TOTAL REFOA AJnlSTMFNTS 59,800 1.435200 827.660 1,015.560 68,780 3,347,180 36000 2 - 1 36,000 (9,600) - (5 ) - (10,140) ISTRAT MAINTFNANC RU DT2 1,481,600 4 27,560 1,015,020 68.760 343730040 B. Highway Agency Level WORK PROGRAM OBJECT OF EXPENDITURE CONTRACTUAL QQE MAINTENANCE ACTIVITY IN WORK UNITS INMAN DAYS LAO EQUIPMENI MlATERILSk SERVICES. ETC TOTAL BUDGET ROADWAY SURFACE 101 Patch with premix 3.500 tons mix 2.300 67,200 11,200 21,000 - 99,400 102 Level with premix 32,000 tons mix 2,090 50,200 43,900 192.000 - 286.100 103 Deep patch with premix 7,000 tons mix 1.285 30.8000 36,200 42,000 - 109.000 or fuil depth replacement C. Planning/Finance Level OBJECT OF FXPENDITURE Roadway Surfaces 1.415 1,022 1,260 321 4,018 26 Shoulers and Side Approaches 206 189 221 -618 4 Orainage 391 170 210 -771 5 Roadside 1,100 510 398 -2,008 13 Major Structures 307 67 90 -464 3 Snow & Ice Control 602 1,300 1,848 -3.550 23 Traffic Services 99" 390 774 -2.160 14 Extraordinary Maintenance 63 61 28 - 152 1 Servi:e Functions & Overtisadai 1,057 226 97 160 1,540 10 Setterment 91 45 13 -149 1 STATE MAINTENANCE BUDGET 6.230 3,900 41739 481 154010-0 Expwxd#tur Peircentage .4. 91211 Source: R.E Jorgensen, D.H.Park and W.G. Mortenson - Stiret and Highway Maintenance Manual Course Notes. The Institute of Transportation and Traffle Engineering, University of California. Asif Faiz: Planning, Programming and Budgeting for Road Maintenance Table 4. MAURITIUS: EXPENDITURE ON ROADS ------------------------------(RsInmillion)--------------------------- ITEM 1983/84 1984/85 1985/86 1986187 1987188 A. Capital - Road Construction 5.1 18.5 58.3 148.2 213.8 B. Current * Road Maintenance - Routine 2.8 2.8 2.6 3.0 4.2 - Periodic 9.9 10.5 10.4 11.2 10.9 * Administration aj 29.6 29.7 31.0 31.2 35.4 TOTAL 47.4 61.5 102.3 193.6 264.3 _/ Includes personne emoluments and other charges such as travelling, office expenses, etc. Source: Ministry of Works, November 1988 The traditional criteria for classifying expenditures Another approach to classifying road maintenance ex- under the capital budget are (Premchand, 1983): penditures is provided by the treatment of outlays on repairs in the UN System of National Accounts. Outlays * the productivity or the revenue (income) producing on repairs are distinguished as "current" or "capital." capability of the proposed expenditures, normally Current repairs are those that keep the assets "in proper through creation of tangible assets. working order", while capital outlays on repairs are those that "lengthen the expected normal lifetime use of * life expectancy of the asset created; assets with a fixed assets or increase the productivity of these goods life span longer than one year are included in the significantly". In order to be classified as capital, the capital budget. outlays should be "substantial" (Premchand, 1983). This approach would suggest that most road maintenance The strict application of these criteria to road mainte- expenditures including a substantial element of routine nance activities is rendered difficult as maintenance maintenance (e.g., patching potholes, blading gravel operations do not create tangible assets. Maintenance roads) could be considered as capital outlays on repairs helps to extend the life of existing assets or income and included in the capital budget producing capability. The bias toward investment in physical capital could be A somewhat looser interpretation of the above criteria reduced by incorporating certain road maintenance acti- would qualify periodic road resurfacing, pavement vities in the capital (new construction) at the expense strengthening, and rehabilitation works as capital of current operations and maintenance. For example, expenditures. The expected service life of these works resurfacing (periodic maintenance) and rehabilitation is more than one year, and they help to protect and in of worn-out roads can reasonably be classed as capital some cases expand the revenues generated by road rather than current expenditure. Planners might then users (through taxes on fuel and vehicles, tolls, etc.). pay more attention to the need to maintain older roads The revenue receipts, however, form part of a general and to assess the future maintenance requirements of pool or a road fund and cannot be directly linked to new construction projects. The budgetary constraints specific road maintenance or construction expenditures. on rehabilitation would also be less rigid. Such a 61 Asif Faiz: Planning, Programming and Budgeting for Road Maintenance reclassification should also be helpful in reorienting the nation of aid programs in the roads sector by borrower programs of external aid agencies. The arguments for governments and their road agencies. reclassifying expenditures should only be used where existing conventions distinguishing between current and capital cannot be altered, not when budget reform is Key Considerations in Budget the object. Preparation and Implimentation It might be even more effective to integrate capital and Budget Formulation current budgets into a unified road budget and to select maintenance, rehabilitation and new construction pro- Lacking political support and shielded from market jects on the basis of their economic worth, taking into pressures, the budgets for road maintenance are often consideration the future streams of expenditures and unrelated to known requirements. The preparation of the benefits (road user savings) in each case. road maintenance budget, therefore, should start at the smallest accounting unit in the maintenance organiza- Whether unitary or dual, the budget should be compre- tion, normally the district or the sub-district level, hensive. It should include all spending on roads whether to ensure that the maintenance budget bears some sem- financed by general taxes, earmarked sources of reve- blance to physical maintenance requirements, which nue, borrowing or grants. Regardless of how road may be dispersed over a large territorial area. A expenditures are classified, effective coordination correspondence between the physical implementation between central ministries (finance and planning) and unit and the budgetary accounting unit helps to enhance the road agency is essential to ensure adequate alloca- the accountability aspects of budgeting. If budget tion and control of public funds for road construction preparation is not based on a maintenance management and maintenance programs. system, it should be formulated on the basis of: inspection of roads, facilities, and equipment; Integrating Donor-Supported Projects in the PPB Process the previous year's expenditure by major mainte- nance activities and past experience; and Donors finance a large portion of road investment budgets in many Sub-Saharan countries, up to 95% in assessment of changed conditions, such as adjust- some countries. The extensive donor involvement ments in road inventory. coupled with their reluctance to fund current maintenance expenditures tends to complicate policy- The budget preparation process can be significantly making in the roads sector. In many countries, donors enhanced by establishing a maintenance budget review deal directly with the road agencies, thus diluting the committee consisting of the chief maintenance engineer, central control of the budget. Lack of a central a few district engineers representing field personnel, viewpoint makes tradeoffs between road investments and one or more representatives of the planning and and maintenance difficult to assess and overall spending finance ministries (Kelly, 1981). An example of a on roads difficult to contain. In some cases counterpart performance-type maintenance budget as it is processed funds may be separated from the budget to support from the district level to its final submission to the various donor-supported investment projects, leaving central budget agency is shown in Exhibit 4 (Jorgensen few resources for the road agency's maintenance et al. 1972). programs. In addition, the refusal of some donors to fund current spending on maintenance can aggravate domestic budgetary pressures or reduce effectiveness Justification of the Budget (World Bank, 1988, b). As in any well managed business organization, propo- Besides the need for change in donor policies on sed expenditures by the road agency must be justified. funding maintenance expenditures, all foreign aid for First, this entails estimating the value of the capital road programs should be incorporated in the central represented by the road network and the costs borne by budget. Donor-supported projects as well as domesti- the road users. The consequences of prolonged insuffi- cally-financed road operations should be subject to a cient maintenance must be explained in terms of the process of evaluation and prioritization in which due deterioration of the road network, the eventual costs of attention is paid to recurrent funding requirements. deferred maintenance, and the higher costs sustained by Donor activities should be incorporated into the normal road users. All major maintenance activities, such as programming and budgeting cycle so that availability of periodic resurfacing, strengthening, and rehabilitation donor funding does not distort the spending priorities in should be supported by a quantified economic justifica- the roads sector. This calls for more effective coordi- tion for each project or road link. Routine maintenance 62 Asif Faiz: Planning, Programming and Budgeting for Road Maintenance operations should be based on a set of standards and requests when budgets are formulated. Such indirect levels of service derived from an analysis of cost- forms of control, however, slow the implementation of effectiveness. Road maintenance standards and expendi- maintenance programs and adversely affect the morale, tures should be related to traffic volumes, and not to the staffing, and managerial capabilities of the road class of road, if it is accepted that the main purpose of maintenance organization. Funding uncertainties play roads is to carry traffic. Justification for an increased havoc with road maintenance operations that cannot be budget for the federal trunk roads system is presented programmed uniformly over the budget year because of in the Nigeria Case Study. a well-defined construction season. While it is possible to carry out such an analysis The release of maintenance funds by central ministries without the use of computer models, as exemplified in can be considerably streamlined if the road agency the case study on the Ghana Road Stabilization prepares reliable forecasts of its spending requirements. Program, a number of computer models-for example Such forecasts should be based on commitments made HDM-II (World Bank) and RTIM (TRRL)-have been and expected payments with a small amount added for developed to evaluate road maintenance strategies and contingencies. The original budget submission should programs. These models can help to make a convincing include a quarterly estimate of spending requirements. case to legislatures and top decision-makers for These quarterly estimates should be revised once the adequate funding for road maintenance. HDM-III can maintenance budget has been approved or the road also be coupled with the companion EBM to find the agency has received authority to incur expenditures. best way of using road agency funds under budget The assurance of a steady and reliable flow of funds for constraints. Within the planning, budgeting, and maintenance programs is often used as an argument for programming functions of a highway agency, the model special earmarked funds for roads. A road fund can can be used to establish budget levels that minimize the reduce the political inefficiency inherent in the total cost of road transportation, policies and standards allocation of general funds. Where effectively managed, for construction and maintenance programs consistent it can ensure a steady source of funding for critical with minimizing total transport costs given resource maintenance services and provide protection against constraints, and medium- and long-term investment and unreliable disbursement procedures. expenditure programs. Program Adjustment under Budget Constraints Mobilizing Public Support Road agencies often overprogram to protect their opera- There is generally no organized constituency to support tions from arbitrary cuts by finance and planning or endorse the road maintenance program; thus the ministries and pay too little attention to priorities, justification of the maintenance budget falls primarily resource constraints, or phasing. Unexpected budgetary on the road agency. Planned use of the media at budget shortfalls, however, can make even a well-planned road time can be an asset, but road maintenance is a peren- maintenance program obsolete, as funding for various nial function and should be supported by a year-round categories of maintenance expenditures may fall below budget selling job. Periodic press releases and presen- the minimum effective level. The problem may be fur- tations to professional, social or civic groups can be ther exacerbated if much of the budget goes toward the part of the marketing of road maintenance, particularly wages of a large labor force. The disposable portion of if the road agency has an effective public relations the budget fluctuates much more than the total when office. Opportunities should also be provided to elected budgets are cut or prices rise. A small cut can bring officials and the public to provide organized and much of the agency's work to a standstill if, for systematic inputs into the budget process. The road example, it implies that the agency cannot buy fuel or agency should work with the media and potential inte- spare parts. Moreover, even when funds have been rest groups (e.g., professional and trade associations appropriated for maintenance, political or private of contractors and transporters) to make the political interests put pressure on road authorities (or their leadership and the public aware of the effects and high financial sources) to divert funds to other purposes. costs of failing to maintain the roads (World Bank, Such interference, often becomes one of management's 1986). biggest challenges (World Bank 1988). For these reasons setting priorities and developing contingency plans should be a part of the budgeting exercise. This Release of Funds can be accomplished in part by formulating a "core" maintenance program consisting of a group of roads To cope with uncertainties and budgetary shortages, and activities that should receive funding under all central ministries often slow down the release of funds circumstances (e.g., basic routine maintenance, patch- to spending agencies. Slow release of funds is often an ing, blading, safety-related maintenance, and high easier way of controlling a budget than denying funding priority resurfacing and rehabilitation works) together 63 Asif Faiz: Planning, Programming and Budgeting for Road Maintenance with a list of activities to be funded as additional Periodic reviews should be supplemented by a compre- resources become available. The practice of "across-the- hensive retrospective evaluation reported annually in a board" cuts or partial funding of all maintenance acti- public document. Such an evaluation should include an vities should be abandoned. Common techniques used analysis of the objectives of each road maintenance by central ministries for reducing budgetary expendi- activity and the progress made in achieving these tures associated with these techniques are shown in objectives; an examination of the effectiveness of the Table 5. procedures, schedules, and factor inputs (labor, equip- ment and materials) used for implementation of the maintenance program; and an assessment of the benefits Program Review and Evaluation derived from maintenance activities. It is a common legal requirement that public expen- A major issue in program review and evaluation is the ditures on roads be subject to financial audits. location of the evaluation authority. It might be argued Such audits mostly examine if funds were spent as that if the evaluation authority were located in the road authorized and put little emphasis on the value obtained agency, it could be used in a self-serving manner, main- from the public spending on roads. Periodic reviews of ly to obtain additional funds for the road programs. road maintenance programs should ensure an adequate Given the technical and specialized nature of road linkage between physical and financial progress. Such programs, the evaluation authority should reside in the reviews should identify the lags in physical progress as road agency but the evaluation unit or department well as areas where money expenditures are ahead of should have sufficient independence so that the object- physical progress. A further objective of performance ivity of the evaluation process is not compromised. This audits should be to relate financial flows and mainte- can be best achieved by having an experienced senior nance performance or technical indicators to the state of officer head the evaluation unit, reporting directly to the the roads. minister or head of the road agency (Premchand, 1983). 64 Asif Faiz: Planning, Programming and Budgeting for Road Maintenance TABLE 5. TECHNIQUES FOR TRIMMING BUDGETARY EXPENDITURES Nature of Technique Measures Used Implications for Road Maintenance Operations Across-the-board cuts in General percentage cuts in all Mainly affects the disposable portion of the road expenditures; rescissions. activities. maintenance budget (operating expenditures, fuel, spares) as the wage bill cannot be reduced in the short term. A small cut can bring the maintenance operation to a standstill. Specific activity cuts: Elimination of expenditures Lowering maintenance service levels (e.g., frequency impoundments of funds on specific maintenance. of routine operations), elimination of some mainte- or activities. maintenance activities, and network contraction. Selection of high- In the context of a resource Substitution of overlays by seal periodic resurfacing yielding operations. squeeze reliance is placed on m on by more intensive patching. Reducing frequency of maintenance operations that have of blading and regravelling. lower agency costs but still yield high economic return. Reduction in expenditure Reduction in administrative posts Short-term effect on the budget is minimal but provides on personnel and not filling existing posts. a good strategy for reducing the maintenance wage bill bill over time. Quarterly cash mana- Release of quarterly apportionments Not an effective technique for maintenance programs gement budgets: cash to road agency so that they remain as maintenance work load is not evenly adjustment limits and other within limits of specified resources distributed over time and is subject to peaks adjustment mechanisms. for maintenance. Adjustment within resulting from climatic and geographical conditions. those ceilings is a matter for the road agencies to decide. Source: Adapted from Premchand (1983). References 1. R.E. Jorgensen, D.H. Park, and W.G. Mortensen. (1972) Street and Highway Maintenance Manual Course Notes. The Institute of Transportation and Traffic Engineering, University of California, Berkeley. 2. James F. Kelley. (October 1981) Formulating and Justifying Highway Maintenance Budgets. NCHRP Synthesis of Highway Practice 80. Transportation Research Board.Washington, D.C. 3. A. Prerichand. (1983) Government Budgetary and Expenditure Controls - Theory and Practice. International Monetary Fund, Washington, D.C. 4. Federal Highway Administration, U.S. Department of Transportation. (1985) Roads and Streets Maintenance Management System (MMS). Washington, D.C. 5. World Bank. (1988 a) World Development Report, Washington, D.C., pp. 105-130. 6. World Bank. (1988 b) Road Deterioration in Developing Countries - Policies and Remedies. A World Bank Policy Study, Washington, D.C. 65 Robert C. Petts Road Maintenance Management and Operational Planning Summary appropriate geometric and serviceability standards This paper proposes policy objectives in the area of for various categories of roads; realistic road road maintenance management with reference to opera- maintenance objectives, both long term and inter- tional planning, programming and monitoring, and mediate; road maintenance priorities; presents options and actions for achieving these objectives. * upgrading criteria: earth to gravel, gravel to bitumen/concrete standards; Planning can be shown to be required at two distinct levels with respect to road maintenance (Figure 1). At the utilisation of finite or limited national resources the upper level network planning deals with the mana- such as gravel, bitumen, cement; gement of the highway network, of which road mainte- nance is but one component. At the other level is the utilisation of local resources such as labour, operational planning which deals more with the resour- simple equipment or the private sector; and ces directly allocated to road maintenance. Both plan- ning roles are crucial to the successful management and the management of axle loading on the road maintenance of the road network. network. Network and Operational Planning Some of these operational policies have a significant political dimension. All of them must be tackled to The road network is a national asset that must be ensure effective management of the road network. In managed effectively to enable an efficient transport order to develop these network planning policies, it is sector to support economic development. To manage necessary to have: the network effectively, policies need to be developed as a working framework for both investment in and an institutional framework that will enable policies maintenance of the road network. These policies should to be developed, agreed and implemented; cover at least the following areas: the resources required to collect, process and the balance between road agency and road user present the necessary data; costs; the systems to process the data and develop the the distribution of available road sector funding policy options for discussion at senior management between construction, rehabilitation and mainte- and political levels; and nance; the trained, experienced, and motivated manpower the extent of road network wholly maintainable to carry out the planning functions. using central organisation and funding: responsi- bilities, funding and resourcing for the remainder of Critical appraisal of the network planning function in the road network, most road authorities will show deficiencies in the above requirements. Robert C. Petts Is a consultant with Because of this the road maintenance authority is often the firm Howard Humphreys Consulting unable to perform several functions including: demons- Engineers Surrey, U.K. trating to political authorities and the general public the importance of road maintenance; mobilising appropriate The paper is edited and adapted by the SSATP or adequate finances for road maintenance; presenting from an original text submitted by the author coordinated policies to donors and facilitating rational 0 1989, SSATP - World BankJECA investment in the road sector; optimising the use of locally available resources including the private sector. Figure 2 illustrates the suggested framework for action. 66 Robert C. Petts: Road Maintenance Management and Operational Planning Operational Planning These are the key fist-level issues related to Mainte- nance Management which should be effectively tackled Operational planning, programming and monitoring if road maintenance performance is to be improved. (PPM) concerns the management of the funds and Figure 4 illustrates the suggested framework for action. resources allocated, particularly to road maintenance. The principal operational road maintenance functions are related in a fairly simple annual cycle. Figure 3 Options for Improving Road illustrates this flow of functions commencing with Maintenance Management establishing and quantifying maintenance needs. This section discusses the options for improving road The planning functions should, of course, commence maintenance performance; it considers improvement well in advance of the maintenance funding year. options regarding functional separation, resources, data Monitoring and reporting will feed back into the requirements, systems, and personnel aspects. planning process for subsequent years. Each of these functions will contribute to the effectiveness of road maintenance. Collectively the PPM functions will have Functional Separation a significant influence on overall road maintenance performance. It is often asserted that the field engineer knows his network, particularly in an objective way. In fact, he PPM can be constrained by the following factors: will probably not appreciate the options for maintenance interventions and the full associated costs and benefits * organisational framework and individual responsi- to the network. Furthermore, high turnover in staff and bilities inappropriate for effective PPM; other duties may prevent the engineer from becoming acquainted with his network or its needs. In addition, * no budget for PPM functions; accountability is very difficult to achieve when the same person is identifying needs, planning, organising, " appropriate procedures and systems not established controlling and reporting the work to a senior or central to carry cut the PPM functions; remote person. * personnel resources not provided, trained or moti- There is a strong case for separating the operational vated to carry out the PPM functions; planning and monitoring functions from the scheduling and implementing functions. This is usually successfully " insufficient data or access to data to carry out achieved for construction works where accountability in specific PPM functions; terms of completing works to time, to specification and to cost against planned criteria is possible. Without * physical resources not provided, e.g., survey equip- separate planning and monitoring functions it is very ment and transport; difficult to plan the best use of available road mainte- nance resources and to be satisfied that the work is * lack of guidelines regarding priorities and inter- carried out effectively and efficiently. vention criteria; The separation of the operational planning and moni- * constraints not properly identified and tacked; toring duties from implementation also allows flexibility regarding the following options for maintenance imple- " technology or implementation options not available; mentation: " insufficient or irregular flow of funds. * Force Account (Direct Labor) These factors constrain effective operational planning, * Contractor (Individual or Company) programming and monitoring with knock-on conse- quences for deficiencies in the following areas: * Agency Agreement-Local Authority, Land- owner(s), Commercial enterprise (e.g., plantations), * management of financial resources, NGOs. * management of physical resources, * Voluntary or "Social Duty" participation (e.g., for tertiary roads). * use of local resources and the private sector, The role of planning and programming within road * internal accountability. maintenance organisations needs to be carefully defined 67 Robert C. Petts: Road Maintenance Management and Operational Planning and an appropriate organisational structure developed * decide the appropriate degree of mechanisation or to: sophistication of data collection, processing, storage and dissemination; provide sufficient authority to effectively carry out the planning and monitoring functions; * review data collection capability and be realistic in estimating future capability; and provide an adequate chain of responsibility and accountability. * consider the data requirements of other road main- tenance functions. There is some scope for private sector participation in planning and programming functions, for example, with The essential data required for effective PPM fall respect to regular surveys to determine road conditions mainly into the following categories: and maintenance needs. Road Inventory and Condition: maintenance needs; Resources Maintenance Resources: manpower, equipment and support, and materials; Planning and monitoring functions cannot be carried out without funding. There are no guidelines available for Maintenance Achievement and Productivities; assessing an appropriate budget or resource provision for these activities. However, in the rural highway Maintenance Unit Costs. construction sector, design and supervision of the work are typically 8% of the total cost of works. This ensures These data need apply to both Network and Operational quantification and specification of works and comple- Planning with different degrees of aggregation. The tion to these requirements. categories of data listed above are required to support policy and strategy development and decisions particu- Discussion regarding appropriate allocations for PPM larly in equipment management, appropriate use of should be encouraged. A cost-benefit relationship of, available resources and technology, use of local for example, 5% of total maintenance costs allocated to contractors and consultants and staff. PPM, to secure an increase in effective maintenance of 50% would be a very worthwhile investment. Specific personnel, accommodation, transport, equipment and Systems budget allocations demonstrate the commitment to PPM and protect the function in times of overall funding Effective systems and procedures for planning, pro- cutbacks. gramming and monitoring need to be established, based on manual or computer-assisted systems. The main advantages of computer systems are the large amounts Data Requirements of data that can be processed, stored and easily accessed. However, the appropriate operational frame- Adequate data are required to support PPM functions. work and the discipline of correct data collection and A number of PPM systems installed in recent years vetting are equally necessary for both computer and have been overly optimistic regarding the extent and manual systems. accuracy of data that will be collected. Computer systems require specialist technical support For a PPM system the guiding principles should be to: and spares and training of operators and users. There are dangers that hardware could suffer similar problems * collect only the data essential to support important to road maintenance equipment unless adequate support PPM decisions, at least initially; systems are developed. Another potential pitfall is that, because the system is available, it will encourage addi- * decide the extent of data collection for each item; tional demands. This can easily lead to overloading of the system. There should also be fall-back systems and * determine the accuracy required; procedures for the inevitable occasions when systems break down. Systems will invariably need to be tailored * decide frequency of collection and updating to dovetail with existing systems and procedures, regu- required; lations, organisation structure and responsibilities, 68 Robert C. Petts Road Maintenance Management and Operational Planning personnel resources and capabilities, and network and Insufficient attention is normally given to the road maintenance characteristics. motivation and accountability of personnel. Efforts regarding the provision of adequate funding and Network planning has particular system requirements resources will be wasted if maintenance personnel are for the development of policies and plans. Some sort of not motivated to perform and if they are not modelling is normally required to carry out these accountable. functions. Various computer models exist, such as 11DM III and RTIM 2. The options are to use these Perceptions of status, respect and authority to carry out models as they stand, or to take components of these duties have a significant bearing on the motivation of systems and tailor them to individual road authority personnel at all levels. Remuneration is also a major requirements. influence. Public sector remuneration in many African countries is very poor and is becoming increasingly so. The PPM requirements of routine and periodic mainte- Serious consideration must be given to the provision of nance are somewhat different, and it may be appro- incomes commensurate with duties, status and personal priate to structure the systems to meet these different needs. If managers are forced to supplement salaries to needs. meet basic needs, their attentions will certainly be diverted from official duties to activities that will Routine maintenance is a more continuous need with a satisfy the income shortfall. This significantly affects variety of operations required on a road section during management availability. Poor remuneration encourages each year. Periodic maintenance operations on the other personnel to fall back on their family, clan or tribe. As hand are usually only required on a road section after remuneration problems increase there will be a stronger a period of 5-10 years. Periodic maintenance needs can case for a significant shift to private sector involvement usually be predicted well in advance given appropriate with its greater scope for flexibility, motivation, and pavement monitoring. accountability. It is essential that these human factors be carefully considered when planning interventions to In terms of resources, routine maintenance operations improve maintenance functions. are usually limited in extent and in resource require- ments, whereas periodic resurfacing is usually required over a significant length of road and necessitates Policy Development significant resource mobilisation. This section discusses the considerations which are There are two basic tasks involved in programming and relevant to the development of policy action plans or deploying resources: strategies for improving road maintenance performance. A review of current maintenance problems, capabilities, * Identification and quantification of maintenance constraints and influences is an important first step needs, followed by application of priority guidelines to defining needs and developing a strategy to improve to resource and funding constraints and performance. Management tools such as Goal-Oriented identification of work that can be achieved and Project Planning (GOPP) can provide a useful frame- deployment of the resources to the worksites. This work for achieving this, as well as formulating action is the system typically used for equipment-based plans and monitoring implementation. A case study routine maintenance working from area road camps presented with this paper describes the experience of and for periodic resurfacing works. the application of GOPP to the Kenya Minor Roads Program. * Allocation of resources to individual roads according to resource and funding constraints and It is important to build as much as possible on existing overall maintenance needs assessment, followed by systems, procedures and experience, to enhance or com- direction of operations, according to priorities. This plement these systems, unless they have a detrimental is the system used by the Kenya Minor Roads effect. Program using lengthsmen contractors for routine maintenance. The requirements and PPM systems It is important to limit data collection to information necessary for these two options are very different. essential for important functions, at least initially. However, it is also important to design systems to accommodate possible developments in functions and Personnel data requirements. The provision of sufficiently trained and experienced The development of systems should be carried out with personnel is a basic necessity for the implementation of the involvement of the key personnel expected to planning, programming and monitoring functions. contribute to and benefit from the system. It is impor- 69 Robert C. Pets: Road Maintenance Management and Operational Planning tant that they be convinced of the benefits of new sys- Flexibility to adjust implementation in light of a review tems. Key personnel must be motivated to ensure that is important. Interventions should be realistic regarding the system succeeds. the rate of progress achievable with respect to: required institutional changes; established methods, It will not be possible to improve all aspects of main- procedures and interests; personnel resources, training, tenance planning and management in the short term. It skills and experience; and the ability to set and meet will be important to define priorities based on inter- targets. ventions that are likely to create the best increases in effectiveness given the constraints to bo overcome. Training for personnel involved with all PPM functions will be an initial and ongoing requirement. The ongoing Development of PPM systems should be carried out training will be essential to cover updating and in a phased manner, ideally using a pilot phase or refresher roles as well as personnel replacements due selective introduction to test assumptions and systems. to retirements, promotions, transfers and resignations. 70 Robert C. Peas: Road Maintenance Management and Operational Planning Objective Tree for Improved Road Maintenance Road Maintenance Higher Is Improved Level Objective Other Physical Planning, Programming Other Improvements and Monitoring is Improved improvements Polloy Objective Figure 1 Framework for Action: Network Planning Road Maintenance Higher Is Improved Level Objective Other Improvements Adequate Finances Mobillsed E-I roved Useo Political and Public Donor Coordination Loca Resources and Awareness improved Satisfactory Private Sector Appropriate Policies Network Planning Improved + +4 Policy Frameon Resources Date Systems Manpower Acti Figure 2 71 Robert C Pents: Road Maintenance Management and Operational Planning Figure 3: Annual Maintenance Cycle Establish and Quantify A0 Maintenance Needs Report Achievement Consider Technology and Implementation Options Compare to Plan Cost Resource Requirements/Options Monitor work output, Resources and costs Prepare Draft Annual Plan within expected Budget and Resource (Initiate, Organise and Constraints, using Supervise works) Priority Guidelines Programme Work Prepare Budget (Weekly/Monthly) Submission Finalize Annual Plan on X Notification of Funds Allocation Figure 4: Framework for Action: Operational Planning, Programming and Monitoring Road Maintenance Higher is Improved Level Other Objective Other Improvements Improvements Management of Management of Improved Use of Accountability Financial Resources Physical Resources Local Resources Acco d Improved Improved and Private Sector Improve Operational Planning, Programming and Monitoring Improved 47L k 4k4 t Policy t t t t t Action 72 Fraouna Resources Date Systems Manpower Topic A: Case Study Ethiopia: Making Management Systems Work Nearly one third of the highway network in Ethiopia Finally, the Equipment Management System provides was built before 1960, and some roads were built as asset control procedures (equipment classification, early as 1930. It has been a policy to build compara- equipment identification, equipment inventory, rental tively weak pavements. At the same time, the legal axle recoveries, equipment disposal, equipment usage data load is low (eight tons per single axle) and generally and purchasing strategy), service support (e.g., pre- disregarded. A comprehensive survey carried out some ventive maintenance program, spare parts inventory years ago indicated that axle loads of more than 13 tons control), data support (e.g., equipment reports), finance were quite common. The combination of high axle support, (budgets, revenues), equipment replacement loads and weak pavements has led to the rapid deterio- strategy, and computerization of operational data. ration of pavements and to high maintenance costs. The success of modem Management Systems, however, In addition to the age of the road vehicles an I traffic depends to a great extent on the available human overloading, there are several other factors that have reses ordnl sient staf m b contibued o te por ondtio ofroas ad dfi- resources. Accordingly, sufficient staff must be contributed to the poor condition of roads and defi- provided at all levels to operate the Maintenance ciencies in maintenance standards. These factors include Management System. In Ethiopia, a continuous program foreign exchange constramts on capital equipment and has been launched to train staff who could carry the spare parts, shortage of personnel and sufficient opera- system through. Unfortunately, there has been a ting budget, and lack of experienced staff to make shortage of supervisory staff to monitor and evaluate effective use of management systems. work progress at the field level, and promote communication between the different levels of manage- In Ethiopia, an important lesson drawn over a thirty- ment involved in planning, organizing, directing and year period (1951-1980) was the importance of insti- controlling the maintenance program. The system has, tutional development in the form of improving Mana- however, created a greater awareness of problems of gement Systems. In this regard, the World Bank road maintenance and has demonstrated the procedures assisted the Ethiopian Road Authority to introduce and work methods useful in solving them. several management systems-Maintenance Manage- ment System, Equipment Management System, and Financial Information System. The Maintenance Lack of maintenance equipment and spare parts has Management System provides a rational process for been a major problem in Ethiopia and no amount of developing the maintenance and includes an operational management can compensate for the deficiency. This framework for scheduling, monitoring azd evaluating problem is likely to remain over the medium term, with maintenance operations. The introduction of the road foreign exchange availability being a major constraint Maintenance Management System (initially tested in a on development activities in the country. Low avail- pilot area and later on implemented nationwide) has ability of equipment will continue for some years to assisted managers to be efficient and cost effective in hinder better performance in road maintenance. Avail- controlling various activities. The Fiscal Information/ ability of key items of equipment (graders, asphalt Maintenance interface has provided a consistent form of distributors) is likely to remain less than 40% in the costing that provides reasonably reliable cost estimates. short term. 73 Topic A: Case Study Ghana: The Road Network Stabilization Program* Introduction Deterioration Cycle The trunk roads in Ghana consist of 5,782 km of paved It is estimated that with basic routine maintenance, and 8,352 km of unpaved roads, making a total of including patching of potholes and timely repair of 14,134 km. Most of the network was built before 1970, cracks and edge failures, a newly constructed paved but subsequently suffered fron serious neglect of road in Ghana can remain in good condition for about maintenance. Today, about 40% of the trunk roads are ten years; thereafter, in fair condition for another seven in good condition and 30 percent in fair condition. Due years, during which time it can be restored to good to the inadequate maintenance in the past, a large condition with a thin overlay or a surface reseal. If no backlog has built up that needs to be cleared urgently, periodic maintenance is performed during this time, the in addition to carrying out the routine and periodic pavement will deteriorate into poor condition, at which maintenance required each year. Until last year, perio- time a total reconstruction or resurfacing of the pave- dic road maintenance covered only about 20% of the inent will be required to restore the road to good condi- estimated annual needs. If this trend were to continue, tion. On this basis, and assuming uniform age distri- almost a total collapse of road transport would bution of the roads, it is conjectured that about 1/10th inevitably result. A program to clear the backlog of of the paved roads in good condition will make the maintenance must, of course, take into account the need transition to fair condition each year, and about 1/7th of to spread the investment over a reasonable period of the roads in fair condition will move to poor condition time while simultaneously dealing with the continuing during the same time. For gravel roads, the correspond- deterioration of roads during the plan period. ing fractions are both assumed to be 1/7th. Maintenance Requirements Traffic Major rehabilitation of the badly deteriorated paved Traffic on the trunk road network in Ghana is not very roads require, in most cases, complete reconstruction of high. The average ADT is less than 1,000 vpd over the pavement, including some realigrunent and earth- 76% of the paved roads and less than 200 vpd over works, and major repairs to drainage structures. This 78% of the unpaved network. On most sections, the task is estimated to cost US$250,000 per km. To restore medium and heavy truck traffic accounts for less than the remainder of the paved roads in poor condition, 30% of total volume and has equivalent standard axle resurfacing of the pavement consisting of the addition load factors that range from about 1.5 to 3.0 which are of a new base course and a surface dressing will be not exceptionally high in comparison to those in other required. In some cases, embankments may need to be Sub-Saharan countries, raised or reruilt together with minor shoulder repairs. The estimated cost for these activities varies from US$35,000 per km to US$65,000 per km. An average Pavement Strength figure of US$50,000 per km is used here. Pavements that need to be restored from fair to good condition The pavement in most cases consists of 150 nun of require only rescTling at an estimated cost of gravel subbase, 150-200 mm of gravel base and either US$22,000 per km. a single or double surface dressing or in a few cases, asphalt concrete surfacing. The subgrade strength as The major activity required on unpaved roads is regra- measured by the California Bearing Ratio (CBR), ran- veling of the surface. However, depending on whether ges from an average of 5% to 15%. In most cases, the the road is in fair or poor condition and on the degree pavement structural number (SN) varies from 1.5 to of deterioration, different amounts of repairs of the 3.0. The gravel roads design calls for a 150 in 200 mm shoulders and road formation will be required. For of well compacted, good quality gravel surface. Yet, in simplicity, the average cost of regraveling, including many cases it has not been replenished in a long time. repairs, is taken as US$7,000 per km. Adapted from Anfl S. Bhandari and Kwasi Abbey-Sam - Proceedings of Seminar (, PTRC Summer Annual Meeting, University of Bath England, Vol. P. 309 (1988). 74 Ghana: The Road Network Stabilization Program - Case Study Network Stabilization Plan Such roads warrant only routine maintenance, including patching of potholes and sealing of cracks until such The optimal mix of road conditions in the entire time as the traffic increases sufficiently to justify network can only be determined on the basis of pavement reconstruction. Data was not available at the minimizing total transport costs, i.e., the sum of time to determine the optimal condition mix for the maintenance and vehicle operating costs plus any new trunk road network in Ghana. construction costs. Even if funds are unlimited, it is not necessarily optimal to keep 100% of the network in Therefore, in the interim, a desirable mix consisting good condition at all times. Studies in other countries of about 9,600 km in good condition, 3,000 lan in fair have shown, for example, the periodic resurfacing on condition and 1,500 lan in poor condition, was stipula- the very low volume paved roads (with ADT less than ted, with a breakdown by paved and unpaved roads as about 150 vpd) is difficult to justify economically, shown in Table 1. particularly under budget constraints. Table 1: DESIRABLE CONDITION MIX OF THE NETWORK Road Type Unit Good Fair Poor Total Paved km 4,282 1,000 500 5,782 % 74 17 9 100 Unpaved (Oravel) kn 5,352 2,000 1,000 8,352 % 64 24 12 100 Total Network km 9,634 3,000 1,500 14,134 % 68 21 11 100 Seven-Year Stabilization Program badly deteriorated roads is planned to increase from 150 and 60 km annually thereafter. Table 2 shows the seven-year stabilization program derived in this manner, except that in order to fit the The periodic maintenance expenditure in the first five physical output to the budget requirements, and to build years amounts to US$28 m per annum, decreasing to up the major rehabilitation program slowly over the US$18.8 m over the next two years, before stabilizing next seven years, it was necessary to alter the inter- at US$15.8 m per annum thereafter. Funds required for mediate target lengths in some years. major rehabilitation increase gradually from US$37.5 m in 1988 to US$67.5 m in 1992, falling off to US$55.5 Under the plan shown, the gravel road network will m in 1994 and to US$15 m per annum thereafter. stabilize in five years. The periodic maintenance needs on the paved network will stabilize in seven years, The fraction of the combined network that is in good during which time the backlog requiring major rehabi- condition increases steadily from about 30% to about litation will also be cleared. As seen from Table 2, the 70% at the end of the plan period and is kept at that program requires 918 km of regraveling in 1988, rising level with funds that are well within the existing to 1,224 km in 1992, and stabilizing thereafter to 765 maintenance budget. During the same period, the frac- km per annum. As more and more roads are added into tion of roads in poor condition decreases from about the good condition category, resealing needs will 40% to about 10% and the fraction in fair condition increase steadily from 50 km in 1988 to 285 km in decreases from 30% to about 20%. 1995 and thereafter, while resurfacing needs will decrease from 409 km in 1988 to 83 kin in 1995 and If funds are not made available to embark upon the thereafter. Major rehabilitation and strengthening of the accelerated program of clearing the backlog as 75 Ghana: The Road Network Stabilization Program - Case Study stipulated here, then it can be shown that with only the The program is developed in such a way that the current committed level of funding (approximately backlog of maintenance will be cleared on the gravel US$16 m for periodic maintenance and US$25 m for roads in five years and on the paved network in seven major rehabilitation), it would take about 20 to 30 years years. The fraction of the network in good condition to accomplish the same task of stabilizing the network will improve from about 30% to 70% while at the same to the desired condition mix. time the fraction in poor condition will reduce from 40% to about 10% in seven years. The maintenance expenditure required thereafter will stabilize to Funding manageable levels annually to maintain the network at the desirable condition level. The key elements of the The program, as derived above, called for almost a two- program that have made it successful so far may be to three-fold increase in the annual budget allocation for identified as follows: periodic maintenance of trunk roads made in the past to the Ghana Highways Authority. However, the Government has, since 1987, committed itself to * The program is spread over a realistic time period increase the annual funding for periodic maintenance by and takes into account the continuing deterioration of almost 50% to approximately $16 m per annum. This the roads during this period. would be sufficient to cope with the requirements after the backlog has been cleared and the network condition * While the funds required for implementing the stabilized. Meanwhile, external financing will continue program are greater than past allocations under to be required to clear the backlog under the accelerated government budget, they are not unrealistically high program. for external financing. In addition, the plan is accompanied by a doubling of local funds and a commitment by government to leave the project Conclusion intact in its current and future public investment programs. Ghana has developed a practical program for clearing the backlog of road maintenance and preventing further The project is being closely monitored and loss of the valuable investments in its road infra- supervised by the Ghana Highway Authority with the structure. assistance of local and foreign consultants. 76 Table 2: NETWORK STABILIZATION PLAN (1988-1995) AND PROJECTED ROAD CONDITIONS Year Item Good Fair Poor Reh. Good Fair Poor Pere.Mte. Maj.Reh. 1988 Starting Position 1,593 1,236 2,953 2,672 2,989 2,691 Percent Distribution(%) 28 21 51 32 36 32 1989 Without 1988 M&R Prog. 1,434 1,219 3,130 2,290 2,944 3,118 1988 Expected M&R Prog. 609 -50 -409 -150 918 -153 -765 28.0 37.5 1989 With 1988 M&R Prog. 2,043 1,169 2,571 3,208 2,791 2,353 Percent Distribution(%) 35 20 44 38 33 28 1990 Without 1989 M&R Prog. 1,839 1,206 2,738 2,750 2,851 2,752 1989 Expected M&R Prog. 644 -104 -375 -165 994 -257 -737 28.0 41.3 1990 With 1989 M&R Prog. 2,483 1,102 2,198 3,744 2,594 2,015 Percent Distribution(%) 43 19 38 45 31 24 1991 Without 1990 M&R Prog. 2,234 1,193 2,355 3,209 2,758 2,385 1990 Expected M&R Prog. 680 -150 -345 -185 1,071 -361 -710 28.0 46.3 1991 With 1990 M&R Ptog. 2,914 1,043 1,825 4,280 2,397 1,675 Percent Distribution(%) 50 18 32 51 29 20 1992 Without 1991 M&R Prog. 2,623 1,186 1,974 3,668 2,666 2,018 1991 Expected M&R Prog. 710 -160 -330 -220 1,147 -467 -680 28.0 55.0 1992 With 1991 M&R Prog. 3,333 1,026 1,424 4,815 2,199 1,338 Percent Distribution(%) 58 18 25 58 26 16 1993 Without 1992 M&R Prog. 3,000 1,212 1,571 4,128 2,573 1,652 1992 Expected M&R Prog. 777 -212 -295 -270 1,224 -572 -652 28.0 67.0 1993 With 1992 M&R Prog. 3,777 1,000 1,006 5,352 2,001 1,000 Percent Distribution(%) 65 17 64 24 12 1994 Without 1993 M&R Prog. 3,399 1,235 1,149 4,587 2,479 1,286 1993 Expected M&R Prog. 650 -235 -165 -250 765 -479 -286 18.8 62.5 1994 With 1993 M&R Prog. 4,049 1,000 734 5,352 2,000 1,000 Percent Distribution(%) 570 17 13 64 24 12 1995 Without 1994 M&R Prog. 3,644 1,262 876 4,587 2,479 1,286 1994 Expected M&R Prog. 637 -262 -153 -222 765 -479 -286 18.8 55.5 1995 With 1994 M&R Prog. 4,281 1,000 501 5,352 2,000 1,000 Percent Distribution(%) 74 17 9 64 24 12 1996 Without 1995 M&R Prog. 3,853 1,285 644 4,587 2,479 1,286 1995 Expected M&R Prog. 428 -285 -83 -60 765 -479 -286 15.8 15.0 1996 With 1995 M&R Prog. 4,281 1,000 501 5,352 2,000 1,000 Percent Distribution(%) 74 17 9 64 24 12 1996 Expected M&R Prog. 428 -28 -83 -60 765 -479 -286 15.8 15 Topic A: Case Study Kenya: Minor Roads Program Maintenance System* Overview Through this committee the roads implemented under the Minor Roads Program are planned, selected and Road transport in Kenya is one of the main surface implemented. modes of transport. Essentially, it is the most important mode of transport. It has been developed over the years, from the tracks and trails that were used by traders and Mobilization and Management travellers between the hinterland and the coast, to the of Financial Resources present tarmac highways of today. With the advent of the Kenya-Uganda Railway in the early 1900, tracks The Rural Access Roads Program was initiated in 1974, formed the main access to the line, and with time, and it aimed at providing farm to market access in particularly after independence, the promotion of road twenty-three highly populous and agriculturally transport, through the improvement of the tracks and potential districts in Kenya. trails to all weather roads has been a major objective of the Government of Kenya. Its aims and objectives included: Kenya's road network comprises some 160,000 km of . creation of meaningful employment in the rural roads ranging from bitumen surfaced roads to earth areas through the use of labor-based mothods in roads. Of the 160,000 kIn, 153,000 km are classified road construction; while the rest (97,000 km) are unclassified. The latter comprises earth tracks that are either maintained by the . provision of all weather access to markets, farms county councils or unmaintained, although they allow and social centers; the passage of traffic during the dry weather. raising agricultural production and/or diversity in The classified road network which comprises 63,000 agricultural techniques from subsistence to cash km is essentially the responsibility of the central crops; Government and in particular the Roads Department of the Ministry of Public Works insofar as its planning, raising the standard of living of the rural construction and maintenance is concerned. The population. network is grouped into seven categories which are based on the service given and not on the traffic or the To achieve the above objectives there was a need to surface type. mobilize both financial and human resources. On July 1, 1983, the Government of Kenya initiated a Several donors contributed to the implementation of the policy in which the responsibility of the planning and program, including SIDA, USAID, World Bank, implementation of rural development was shifted from NORAD, DANIDA, Netherlands, ODA (UK), CIDA, the Headquarters of Ministries to the Districts. This SDC, and ILO. The Government of Kenya contributed strategy is known as the "District Focus for Rural mainly the infrastructural and human resources required Development" and is based on the principle of a for the program. At the end of the implementation complementary relationship between the Ministries in phase a total of 8,000 km had been built. their sectorial approach to development and the districts with integrated approach to local needs. In the current improvement-based program of minor roads, 4,500 km of tertiary roads in the rural areas are Each district has a District Development Committee expected to be improved. The following donors are which is the foundation of the decentralized rural devel- participating in this effort: NORAD, SIDA, CIDA, opment strategy. It comprises technical personnel from Netherlands, DANIDA, SDC, EEC and LO. The various ministries, the political members of Parliament financial component is mainly in grant form amounting and representatives of local and non-governmental to 80% of the total budget estimated at K 865 million development related organizations. Its Chairman is the over a five-year period. District Commissioner. Author: B. G. Ariga is Senior Superintendenl Eginieerwh Kenya's Runl Roads Access Programme 78 Kenya: Minor Roads Programme Maintenance System - Case Study Management of Physical Resources of pavements which takes place due to the over- loading of the pavement by overloaded vehicles. The physical resources for the implementation of the program include mainly equipment and the office In addition the transportation of bulk goods on roads is infrastructures. Each district has supervisory vehicles being discouraged in favor of the rail system which is (Land Rovers and motorcycles), trucks for haulage of more efficient for this type of load. An oil pipeline has construction materials, tractor/trailers for haulage of been built from Mobasa to Nairobi and is proposed for gravel, water and fuel bowers for storage of water and extension to Western Kenya in an effort to reduce the fuel respectively. overloading burden on the road network. Tc facilitate the maintenance of these vital pieces of The use of gravel or murram as a road surface material equipment, each district is equipped with a standard is second to bitumen in the provision of all weather workshop and essential tools. Each district is in turn roads. About a third of the road network is to gravel supported by a Regional Workshop headed by a Re- standard. The gravel is normally applied to newly gional Mechanic. improved earth roads to, or close to, engineered standard. It is also used in the regravelling of roads, Donor Coordination which normally has an average cycle period of 4-5 years. With the continued increase in land use for The Minor Roads Program is a multi-donor funded agriculture, coupled with enormous requirements for project. Coordinating the activities of all the donors gravel, there is a general feeling that the existing gravel involves an annual meeting and is held between the sources are on the decline, and the Ministry has sought Government of Kenya and the donors. These annual the use of other materials and/or the preservation of the donors review and evaluation meetings are coordinated gravel surface, in order to meet all weather roads needs. under the auspices of the International Labor Organi- In particular, the Ministry is investigating the use of oil zation. The participants on the donors' side are mainly seals on compacted gravel surfaces particularly on low representatives from the donors' headquarters and volume roads. It is hoped that in due course, the Nairobi. Ministry will devise ways and means to reduce the gravel requirements. This will reduce the need for To monitor the progress of the project on a continuous maintenance operations related to regravellirg thereby basis, several mini-donor meetings are held between the safe on gravel and associated costs. Government of Kenya and the locally based donor All road construction and maintenance activities can be representatives. These are coordinated by the Nairobi undertaken by labor with limited equipment support as based IL0 representative, has been proved under the Rural Access/Minor Roads To supplement the resources of the Governent of Program. In a developing country like Kenya, where Kenya,plocalt pithe esonrcts and supersen o equipment, spares and fuel have to be procured outside Kenya, local private contractors and suppliers are tecuty riigtesac oeg xhne h sometimes called upon to participate in the program's the country, draining the scarce foreign exchange, the activities, such as, graveling of roads with long chienteusoflbraedmhdseoesn haulages, supply of local tools and construction applaudable proposition. It is in this respect that the maes, supply of equpmtsss and long-term objective of the Minor Roads Program is to materials, and supply of equipments, spares and repairs. delofutrlarinnsvtchqesnras repars. develop further labor intensive techniques in roads construction and maintenance. This will ensure the use Use of Local Resources of the local resources of labor, effectively and efficiently. In an effort to find extra local resources for the maintenance of roads, the government, in 1984, enacted Normal road construction activities are carried out by an Act of Parliament known as the "Public Road Toll workers using simple tools. Gravelling of the roads is Act" to provide for the collection of tolls on specific undertaken using tractors and trailers for haulage, while public roads. The Toll Fund was to supplement the excavation, loading, unloading and spreading are carried allocations from the Treasury. About 8-No. out of the out by the workers. gazetted 15-No. toll stations are already operational in the country. During the 1987/88 fiscal year, a total of Contracted lengthpersons maintain the roads using Kshs. 114 million was collected. simple handtools. They carry out routine and urgent maintenance. Periodic maintenance, entailing regravel- The Government of Kenya has instituted the axle load ling is carried out in similar manner to gravelling, but control program in order to curb the premature failure on a limited scale. 79 Kenya: Minor Roads Programme Maintenance System - Case Study The Ministry is carrying out a study to determine the Task work: a worker is paid a fixed daily wage in productivity of lengthpersons to arrive at reasonable return for a fixed quantity of work. lengths that each can adequately maintain. Prompt payment of wages: besides fixing a wage Advantages in the use of the local resources of labor rate which will attract a labor force, and is include: commensurate to production, the other most important motivation of the workers is to pay them * savings in scarce foreign exchange; on time; nothing else lowers the morale of the workers as much as delayed payment. To this end, * reduction in recurrent costs related to accommoda- the program ensures prompt payments to workers. tion and transport; * local involvement in the project creates interest and Developing Managerial and initiative; Technical Skills * workers have the social benefit of being with their Utilization of labor-based methods for road construction families; and and maintenance is a developing technology. To this end the Ministry of Public Works has established ways * creation of meaningful employment. of tackling the issues pertaining to the development of this technology, which includes the establishment of a Internal Accountability, Incentives Technology Unit and a Minor Roads Training School. and Staff Motivation A Technology Unit has been established to investigate various technical and organizational aspects of the The Minor Roads Program is managed by the Ministry Minor Roads Program and also to coordinate the studies of Public Works within the Roads Department. It is being undertaken by consultants. The results of regulated under the service regulations governing the the work of the Unit will be disseminated in the Kenya civil service. The latter entails built-in internal Program through the revision of the Technical Manual, accountability in terms of finance, physical output, courses and seminars. discipline etc. The Minor Roads Training School is geared mainly to For all permanent staff within the program, a scheme of the training and retraining of the personnel in the Minor service stipulating the available promotional oppor- Roads Program in aspects related to the enhancement of tunities exists and is applicable. labor based methods. It offers both theoretical and practical courses and operates construction and For the economy and success of a labor-based cons- maintenance sites for personnel. As of April 1989, the truction program, it has been found that high labor school will extend the use of its facilities to the training productivity is fundamental. To ensure this high of personnel in the rest of the Roads Department. productivity, certain management systems have been instituted to provide incentive schemes to motivate the To enhance the management skills of senior personnel, workers. These are: the ministry, in conjunction with donors, has been organizaing workshops based on GOPP-Goal-Oriented * Daily pay: a worker is paid an agreed sum of Project Planning. Two such workshops have been held money each day in return for working a fixed to date; a third is planned for May 1989. In addition to number of hours. these workshops, personnel within the Ministry have been attending short seminars and courses inside and * Piece work: workers are paid a sum of money per outside the country. The Management and Reporting unit output; the daily output is left to the discretion System is now being computerized to facilitate the of the site supervisor. program's planning and monitoring. 80 Kenya: Minor Roads Programme Maintenance System - Case Study Endnotes 1. HHMS procedures manual MOPW, 1st August 1989, Revised Edition December, 1988. 2. Project Proposal for MRP, MOTC, January 1985. 3. General policy paper on the rehabilitation and maintenance of Rural Access Roads and Minor Roads P15-83 of May 1983 Ministry of Transport and Communications. 4. The Maintenance of Rural Access Roads in Kenya, a discussion paper, ILO, July 1982. 5. Road Toll Operations named, MOTC, November 1984. 6. Rules and Regulations for the Public Roads Toll Fund MOTC, April 1986. 7. The Minor Roads Program interim Road Maintenance Manual, Ministry of Public Works, April 1988. 8. R.C. Petts Discussion Paper on the maintenance of rural access roads and the scope for the extension of labor-based methods into the routine maintenance of classified roads in Kenya, ILO 1982. 9. Ove Arup and Partners for ILO, Kenya Rural Road Maintenance Study - Final Report (1987). 10. A Perspective on Road Maintenance and Deterioration in Africa, R. Robinson, TRRL - 4th African Highway Maintenance Conference. 81 Topic A: Case Study Kenya: Goal Oriented Project Planning* Introduction project management during implementation. If a problem, external to the project, corresponding to an Policy action planning and project action planning are assumption worsens over time, the project should either both carried out with the aim of improving/solving a be discontinued or extended in scope to include the problem area. This involves the analysis of the problem solution of the problem with the support of higher in the sector considered. Out of the analysis, expedient political authorities. The risks bound with the objectives are identified, strategies devised and steps assumptions may very often reduce the effectiveness of and measures planned for producing the expected the projects and developmental impact (sustainability). improvements. From the methodological point of view, A project designed with policy action planning is likely the same planning tools can be adopted both for project to have more of an impact. Figure 4 shows possible and policy action planning. A very effective tool for policy action planning for improving Rural and Minor project planning is the "Goal-Oriented Project Planning" Roads maintenance in Kenya. With the goal of (GOPP) method, which was used on the Kenyan Minor "improving Rural and Minor Roads maintenance"(see Roads Program (KMRP). The goal of the KMRP is to Figure 4: Goal), five policy objectives should be improve the maintenance of some selected 12,000 lan considered and weighted. Options for achieving the of rural and minor roads in Kenya by developing and policy objectives should be identified and implemented implementing a sustainable maintenance system. GOPP through suitable activities to the extent deemed was used for the 1988 annual Donors and Government necessary. Problems and objectives could be clarified of Kenya KMRP review meeting. GOPP enabled the by a planning team using GOPP and could be presented requirements and views of the Kenyan Government and to the political authority for approval. In the proposed seven donor agencies to be coordinated and action plans policy action planning, the KMRP objectives are still to be jointly developed for future program imple- valid, because the program can achieve the policy mentation. objective of "improving efficiency of maintenance operations"(see Figure 4), but other activities related to Overview the other four policy objectives should be implemented. By following this policy approach, action effectiveness With GOPP, a planning team agrees on a central would be increased as well as the developmental problem for a situation: the so-called "core problem". impact. When following a narrow project-based Causes and effects of the core problem are explored approach to solve a sector's problems, the efficiency of and their interrelationship graphically represented in the projects can be high, but the cumulative influence of form of a chart: the so-called[ "problem tree". Figure 1 problems outside the project scope are likely to shows the problem tree for the KMRP. Using the dramatically reduce its effectiveness, impact and GOPP method, the problem tree is turned into a sustainability. corresponding "Objectives Tree" by turning each problem into a corresponding objective. Figure 2 shows the objectives tree for the KMRP. Not all the problems Conclusions can be solved within the scope of a project and that is why in Figure 2 several problems have not been turned Goal-Oriented Project Planning is a very effective into objectives. These remaining problems, which lie problem-solving and action-planning tool. It is very outside the project scope, represent risks of failure well suited for both policy action planning andpProject affecting the project. Therefore these risks have to be action planning. It has proved very valuable in the evaluated by the planning team and the corresponding context of the KMRP, allowing the Ministry and seven assumptions stated in the project design. Figure 3 now donors to: shows the objectives of the KMRP and the assumptions now incorporated in the planning. The influence of * agree on the prioritization of objectives and on the these assumptions will have to be monitored by the implementation of phased strategies; . L. Canonica, Swiss Development Corporation. 82 Kenya: Goal Oriented Project Planning - Case Study prepare a jointly agreed action plan and basis for GOPP as a valuable problem-solving and planning tool monitoring for further implementation of the creates transparency for the problem area. It can be KMRP; advantageous when used for project planning, Sbe aware of and jointly evaluate risks affecting the increasing efficiency and optimizing effectiveness and * rbgaare oimpact under the given circumstances, but it can also be program; used for policy action planning, increasing effectiveness * be aware of and tackle long-term issues related to and the impact of any following action. program effectiveness and sustainability. Maintenance of Rural and Minor Roads Insufficient Publil and Core p oblem Political Gansport Lg Ter Government Awareness of Needs and KMRP Budget Maintenance Priorities not Efficleancy Manpower Allocation importance Assessed Too Low Planning not Secured Toinsufficient Role of Ministry's Private Manpower Staff Orgnization Technical Financial Sector Planning and Performance an Planning Issues Management Too Low no aToo Low insufficient Unresolved Insufficient IIns********* Poor Budget Iraining o Graveling not Related to Inadequate 4 Or n lonal insufficient Implementation tructure Inrflln cit Capacity Lack ot Number of Equipment Budget Plans Supervision + IKey Staff Maintenance not Followed Insufficient Insufficient Staff Lack Interim Road Lack of Motaton Management Maintenance Q aff MotIatin Sytemnotfor Fin. Mgt. 4 Skills ImplementedPI + Poor Manpower Reporting System Donors Donors Selection & not Developed as Requirements Coordination Management Tool not Harmonised Insufficient Figure 1: PROBLEM TREE FOR THE KMRP A core problem is agreed upon by the planning team ("KMRP efficiency is too low") and the cause-effect relationships of the core problem are explored and graphically represented. Dotted lines link problems which cannot be solved by the KMRP-management and require higher authority's decision. 83 Kenya: Goal Oriented Project Planning - Case Study Gal] Maintenance K of Rural and Minor Roada F- + tisk Rk Project Planning Objective Rak Rak Public and TMGvrmn Political aport KMRP Long d Government Awareness of Needs and Efficiency Manpower t Maintenance Priorities Improved Planning AllSctn mortanco not Assessed Insufflc=t kaPlanned Output Of Ministry's - Role of Ma Staff Organization Technical Financial Private A d and Planning issues Management Se Low Devel ment Improved improved Worked Out Improved Aciiis Activities Activities Activities ITaing OrartonlG mp2 to prImproved Capacit Notation: ObjecriRosadlon Key Staff (Actiity) Objetive iUmpOved insufficient ipoe Lack of ~ ~StaffManeacfoFinil Skillsluaseimpeene=Aalal Riska to be Evaluated Isk Figure 2: OBJECTIVES TREE FOR THE KMRP The objectives tree is obtained from the problem tree, turning problems into objectives for their solution/improvement. The graphical representation indicates the means-to-end relationships among objectives. Problems which cannot be solved by the KMRP remain problems, representing risks for the achievement of the program's objectives, and they will have to be evaluated by the planning team. These remaining problems/risks are represented in rectangular shapes linked by dotted lines to the objectives tree. In the figure, activities are identified to produce outputs which would achieve the project planning objective: "KMRP efficiency is improved." The project planning objective would contribute to the goal: "Maintenance of rural and minor roads is improved." 84 Topic A: Case Study Malawi: Maintenance and Rehabilitation Management System* Introduction Most of the road network in Malawi was constructed in condition, upgrading of road sections from earth to the early 1960s. Ever since there has been a continuing gravel and from gravel to bitumen standards. The program of new road construction, reconstruction of designated road network as of 1986 (excluding the road aging sections of the network that have come to the end network in municipal areas.) is as follows: of their useful life and are no longer in serviceable ROAD Main Secondary District Branch Estate U TOTAL TYPE (M) (S) (D) (B) (E) km km ki km ki km km Bitumen 1812 260 24 0 8 73 2177 Gravel 127 149 16 0 0 0 291 Earth 733 2333 5316 136 108 335 8961 TOTAL 2672 2742 5356 136 116 408 11429 There has been a rapid expansion in Malawi's rural government on an agency basis. economy. With the recent construction of road links to neighboring countries and the loss of railway links to the The current road designation was done in the 1960s. Since seaports of Nacala and Beira in Mozambique, Malawi then there has been an increase in traffic levels on most relies more on road transport for the movement of its parts of the road network. The road designation has been goods both internally and for exports and imports. The reviewed to take into account changes in the function and need to keep the road network adequately maintained is, importance and act as a guideline for setting priorities for therefore, of utmost importance to the country's economy. the ongoing national road development program. To implement an effective road maintenance and rehabilitation program, it was essential to have an organized system for planning, controlling, and monitoring The Maintenance and Rehabilitation the road maintenance and rehabilitation program. It is for Management System (MARMS) this reason that the Maintenance and Rehabilitation Management System (MARMS), a tool for the proper On a construction project, with well defined activities, management of the road maintenance program for the project network techniques are used to develop a logical nation's main road network system was implemented in approach to planning, organizing, scheduling, control- 1984 to improve, rather than replace the existing practice. ling, and evaluating the progress of the project, as well Earlier the District Road Improvement and Maintenance as the level of expenditure at every stage of the project. Program (DRIMP) was introduced for the rehabilitation It is difficult, if not impossible, to use such techniques and maintenance of the district road network that is vital for maintenance work since the activities involved are for communication in the rural areas of the country. clearly not as well defined, and the work load is usually demand-driven. Maintenance work load responds to Central government (through the Ministry of Works) is changing factors that contribute to the deterioration of responsible for the maintenance of the designated Main the condition of a road, the weather, traffic volumes, (M), Secondary (S), and a few important District (D) and axle loading, and indeed road maintenance practice, just undesignated (U) roads. Local government through the to mention a few. MARMS provides managers a tool to district councils is responsible for the maintenance of the manage routine maintenance and rehabilitation works. designated District (D) road network. The rest of the The objective of implementing MARMS in the network is maintained by other organizations or by the Malawi's Roads Department of the Ministry of Works Prepared by Mr. -H. Msolomba, Malawi's Deputy Controller of Roads (Construction and Maintenance). 85 Malawi: Maintenance and Rehabilitation Management System - Case Study was to provide managers with a tool that would assist period (if the level of service was acceptable) or set a them in providing an efficient and effective road new level if what was achieved during the previous maintenance program. MARMS is the basis for* period was too high or not acceptable. * achieving a uniform level of maintenance of roads Annual Work Load, Work Program and Budget. throughout the country; Annual work programs for each district by road type are prepared from the inventory data collected from the * preparing an annual work program based on districts, the performance standards, and the set service priorities identified from maintenance feature and/or levels. The district totals are summed to form regional condition inventories and the level of service to be budgets, and regional budgets are further summed to provided as determined by policymakers; form the national road maintenance budget. The budget requests (combined with budget requests for other * efficiently allocating resources, i.e., labor, materials, sections within the roads department) are then presented and equipment needed to perform the annual work to the Treasury. If funds are allocated as requested, program; there are no adjustments made to the work program. However, if fewer funds than requested to fulfill the * preparing a performance-based budget to support the planned program are allocated, there will be a need to annual work program; make adjustments to the work program either by redu- cing the level of maintenance service to be provided on * scheduling, authorizing, and performing work in all or some activities on part of or the whole network, accordance with methods and procedures designed or by reducing the amount of inventory units on which to ensure optimum efficiency; the work would be performed, or both. Consideration would have to be given to the relative importance of * reporting work performance in ways that permit activities and sections of the network on which service management to effectively control and evaluate levels will be reduced). When the work program is maintenance work program and operations; and approved and funds are allocated to the regions each district supervisor is sanctioned with funds to enable * improving in communication between all responsible him to carry out the work on his program for each for the management of the road maintenance period. program. The district supervisors then schedule and authorize The steps involved in MARMS are as follows: work as per the agreed program. Work is scheduled on a fortnightly basis taking into account work priorities as Maintenance feature and condition inventory. identified during inspection trips. The work accomplish- Maintenance feature and condition inventories are ed is reported to the region using reporting forms. The conducted twice a year by district road supervisors. The report contains information for each activity, resources purpose of these inventories are twofold: to use and to used, where on the road network the work was done, prepare the work program for the following year, and and the work accomplished. This information is record- to update and revise the work program in between the ed into a data management system at the regional head- planning period. The procedure was made very simple quarters and performance and evaluation reports are so as to make it possible for each road supervisor to prepared and distributed to district, regional and conduct an inventory for the network for which he is headquarters managers to use for control and evaluation responsible. purposes. The MARMS flow Chart shows how the sys- tem operates (See Annex 2). Performance Standards. The performance standards in use were prepared in conjunction with the road supervisors. The objective was to standardize methods Management and Policy Issues of performing work activities. The performance Addressed by MARMS standards outline the work method to be used, the standard resource requirements for a standard crew, the The implementation of MARMS in the Roads expected daily production, and performance criteria for Department of the Ministry of Works has allowed the each activity. The standards are updated at headquarters government to address several important management after past performance reports have been studied or and policy issues that have contributed to a more when a more efficient method of carrying out an effective and efficient maintenance and rehabilitation activity has been identified. program for the road network in the country. Setting service levels. Service levels are set at MARMS has assisted management in identifying in headquarters, normally to maintain the level of detail the maintenance work load for each management maintenance service provided during the most recent unit. The work load is broken down into activity levels 86 Malawi: Maintenance and Rehabilitation Management System - Case Study for each management unit. This has made it possible to headquarters whereby funds are allocated quarterly for set and measure performance for the road maintenance work programmed for each quarter. At the end of the effort and also to measure the effectiveness of the road quarter a meeting is a arranged to evaluate the maintenance efforts for each management unit and performance for the period. Any major divergence from eventually for the department. the plan either in work performance or level of expenditure is accounted for. The issue of funds for the Through the reorganization of road maintenance dis- following quarter is made taking into account any tricts and zones in setting up the management system, savings, over expenditures, and revision to the program it has become easier to identify road maintenance that are necessary. supervisory personnel, and basic camp and equipment requirements. It was, therefore, easier to identify The implementation of the management system in the training needs for staff development, and to continue maintenance section of the roads department has assist- training for serving staff to improve their technical and ed in clarifying the objectives of each management unit. managerial skills. Equipment is a major input in road Prior to the introduction of the system most of the maintenance programs. Unavailability of equipment in planning for work was done by the regional managers. serviceable conditions or simply the lack of an adequate The district road supervisors were agents for carrying supply of a particular piece of equipment has, in the out maintenance work as instructed. The district road past, resulted in delayed and often more costly supervisors are now responsible for planning for main- completion, or in the extreme case, failure to complete tenance work in their district. They are now accountable a maintenance program. With the management system, financially and for work performance. There is an planning for the availability of equipment at the right improvement in management skills at the district level place at the right time is made easy. Sometimes pro- as a result of the increased responsibility and training grams have been delayed due to the unavailability of provided. The district supervisors and the zone road materials in sufficient quantities when required. This, foremen are more aware of the costs involved in carry- too, results in unnecessary and costly delays sometimes ing out various maintenance activities. As a result there resulting from a lack of adequate forward planning. The is more thought given to planning and scheduling main- MARMS help managers to identify the material tenance work at the district level in order to reduce requirements to fulfil the work programmed for each costs. Comparison of work performance between period. If some materials need advance ordering, districts has aroused the spirit of competition, and each managers are made aware of this requirement and can supervisor has the incentive to perform as well or better press for orders in advance to ensure delivery in time than others doing similar work. The district supervisors for the activity for which the materials are required. have to make their own work schedules based on work Sometimes because of financial constraints, programs priorities as identified during field inspection trips. The have been delayed. Sometimes efforts to catch up with decentralized short-term planning for maintenance work the program following late issue of funds have resulted in the districts (previously done by regional managers, in poor work quality and a more expensive program now the responsibility of the district supervisors) and because of increased overheads as a result of having to the availability of more detailed monitoring capability, keep people and equipment idle. The system makes it through performance reports, has relieved the regional possible for management to identify cash requirements managers of some of their former responsibilities. They for each period and so plan for the adequate provision can now concentrate their efforts on control and evalua- of funds in advance. In cases when funds are delayed tion and planning for the long term. the system allows management to adjust the program so as to reduce the effects of the delay in the allocation of financial resources, or when it is obvious that delays in Management of Periodic Maintenance allocation of funds are inevitable, advise the financing and Rehabilitation Work agencies of the expected adverse effects. Routine maintenance work is done by direct labor The budgets prepared by the system are based on the through the regional controller of works establishments. work load estimated by taking inventories, work Periodic maintenance and rehabilitation work is required to achieve a set level of maintenance service, contracted out most of the time. The ministry still and a set performance standard. Unless the factors that maintains Road Construction Units (RCUS) which carry contribute the deterioration of the road condition change out some of the rehabilitation projects. Manual methods drastically during a planning period, the planned budget similar to MARMS are used to manage rehabilitation estimates are close to the actual requirements. To works done by these in-house construction units. There ensure that the agreed budgets are not exceeded for no are reasons for the allocation of some of the good reason, the work progress is controlled by rehabilitation works to the RCUS. The RCUS are used performance reports which are submitted at agreed for training engineers and technicians. They are readily intervals. In addition a contractor-client relationship available to respond to emergencies. The activity unit was established between the regional offices and costs achieved by these units form the basis for 87 Malawi: Maintenance and Rehabilitation Management System - Case Study comparing unit rates used by contractors when bidding The road department management structure was reorga- for work of a similar nature. Sometimes because nized to provide a structure with additional staff to take projects are funded locally, or because of limitations responsibility of planning, control and evaluation for imposed on exports of local currency, many contractors maintenance, rehabilitation, and new construction pro- are not willing to bid for locally funded projects. There grams. The main changes were: are very few indigenous local contractors that are capable of carrying out road rehabilitation works * the formation of the maintenance and construction satisfactorily. When such situations arise there is little division at headquarters level. choice but to use the RCUS. However, they are required to plan and budget for the rehabilitation works * the merging the Roads and Design Departments into and report work performance as with the regional one department. controllers. * the formation of the Road Planning Unit within the Planning, selection, and appraisal for road rehabilitation Design and Planning Unit. projects is done by the Road Planning Unit using the Highway Design Model (HDM3). This unit was esta- * the establishment of individual units within each blished at the same time the maintenance management division to be responsible for planning and system was being implemented to assist with the monitoring. selection of rehabilitation projects. This is the first step towards the development of a pavement management * the establishment of a Mechanical Engineer's section system which is necessary for the proper planning of a to take responsibility for the provision and road preventive maintenance program. The activity unit implementation of a preventive maintenance program costs from MARMS and the RCUS manual systems are for the department's basic equipment fleet. used as input data to the highway design model. The Organization Structure - Roads Department Notes: COR = Controller of Roads CCE = Chief Civil Engineer Secretary for Works ACCE = Assistant Chief Civil Engineer PCE = Principal Civil Engineer PME = Principal Mechanical Engineer Commissioner for Works Roads Dep Citmeent Regional Controller of Works (3 No. Regions) Planning Construction and Des*n and Maintenance (Deputy 009R) (Deputy COR) Roads Planning and Cotacts Soils and Materils Construction Maintenance Branch Documents Branch Laboratory Branch Branch Branch (CCE) (CCE) (ACB) (CCE) (COCE) Planning inventoy Bridge investigation Construction Trunk Rural Planning & Direct E uipment rmming & Traffic Airport Design Research control Roads Roads Monitoring Labor Services nh Scin Design Section Section Section Section Section Section Section Section (POE) (POE) (CE)n (PCE) (PCE) (PCE) (PCE) (PCE) (PCE) (PCE) (PME) 88 Ministry of Works - Malawi Malawi: Maintenance and Rehabilitation Management System - Case Study MINISTRY OF WORKS AND SUPPLIES Roads Department MAINTENANCE and REHABILITATION MANAGEMENT SYSTEM 1.WORK PLANNING 7. SYSTEM MODIFICATION 2. WORK PROGRAMME AND IMPROVEMENT DEVELOPMENT MAINTENANCE MANAGEMENT INFORMATION FLOW CHART 6. WORK EVALUATION I 3. WORK AND CONTROL AUTHORIZATION 5. WORK PERFORMANCE 4. WORK AND REPORTING SCHEDULE 89 Topic A: Case Study Niger: A Practical Management System for Programming Periodic Maintenance* Niger is a landlocked country in West Africa that periodic resurfacing programs, including cost estimates extends from the northern fringe of a rain-fed agri- and economic justifications. cultural region into the heart of the Sahara desert. Nearly 90% of its six million population is concentrated along the southern border in the 12% of the land that is Data Collection arable. Niger is one of the poorest countries in the world with a per capita GNP of about US$200, and an The immediate goal of the RMU was to produce credi- economy dominated by subsistence agriculture. ble periodic resurfacing programs. In view of the Adequate transportation is critical to Niger. Large limited human and financial resources available, data stretches of nearly empty land exist between population collection was confined to the parameters that were centers. High transportation costs limit the necessary to achieve this goal. competitiveness of Niger's products on the world market, make imported items expensive, and add to the Some information was assembled without field visits, cost of delivering services to distant urban centers and such as the definition of the network, historical the scattered rural population. information on each road link, and quarry locations. In Niger, the PWD is officially responsible only for The road network in Niger is 9,800 km long; 3,160 km "classified" or national highways. However, partly of the roads are paved. Traffic volumes are low; outside because the PWD is the only organization with mainte- urban areas, the highest traffic volume is less than nance capabilities, and partly because the official 1,000 vpd, and only 546 km (17% of the paved roads) classification system is out of date, the PWD actually carry more than 300 vpd. maintains more than the classified network. The main- tained network, therefore, includes paved and unpaved The road network is relatively new; the first one-lane national, regional, and rural roads, all managed by the paved roads were built in the 1960s. In the 1970s, all of PWD. A reference system of nodes and links was defi- these roads were widened to two lanes. A two-lane ned for this network. Each link is homogeneous as standard is now employed throughout the network. The much as possible from the point of view of traffic and paved roads are therefore at a point at which extensive class of road. periodic maintenance is required for the first time. The Public Works Department (PWD) grew into existence Other basic information includes the history of each over the same twenty-five year period. The Ministry of link in the network, such as the dates of original Public Works realized that a rational system was construction, major resurfacing, and strengthening; needed to develop a maintenance program to safeguard quarry locations; and quality and quantity of available investment in the road system. However, this system materials. Long stretches of road in Niger are far from would have to be tailored to Niger, a poor country with suitable road building materials and transport is a major a sparse but expansive road network and an extremely element of maintenance costs. limited number of engineers and technicians. The collection of data by field survey was not the A Road Management Unit (RMU) was therefore esta- responsibility of any existing PWD unit. The RMU, blished in the PWD with two objectives: to monitor the therefore, established, trained and administered its own condition of the network and the volume of traffic survey crews, three for traffic counts and one for road using it, and to develop periodic maintenance programs inventory and condition surveys. for the network on the basis of this data. The RMU must perform three major tasks to accomplish these objectives: collect data, on a continuous basis, on both Traffic Axle Load Surveys paved and unpaved roads; create and maintain a data bank; and develop annual medium- and long-term Traffic data are collected by manual and automatic Adapted from P. Long, G. Lawson, P. Mignerey, "A Periodic Maintenance Management System for Low-Volume Roads in Niger." TRR. No. 1106, Transportation Research Board, Washington, D.C. (1987). 90 Niger: A Practical Management System to Programming Periodic Maintenance - A Case Study counts by three crews based in regional centers. The * road characteristics, such as pavement width, right count program is in operation eleven months each year. and left shoulder width, presence of village or The manual counts last for either three or seven days; junction location, and type of drainage structure; the three day counts include a local market day. These counts include a classification of vehicles into five * roadside condition, such as right and left ditches, types. right and left shoulders, and cut or fill section; and Automatic counts are performed only on paved roads. * pavement condition, such as condition of surface The RMU has twelve counters, eight of which are elec- treatment, cracking and deformation. tronic and are read by a portable microcomputer (an Epson NX20) onto cassettes. They are used with The pavement condition characteristics are recorded on magnetic loop detectors. The other four are of an older a scale of 0 to 5, from excellent to bad, for the surface electromechanical type and are used with pneumatic treatment, and 0 to 3 for the extent of cracking and tube detectors. deformation. Data collected for unpaved roads are width, presence of corrugations, gravel loss, potholes, Axle load surveys are performed using portable scales, rutting depressions and crossfall. and the RMU has also introduced in-motion weighing on an experimental basis using a piezo-electric cable. The French APL 25 longitudinal profile analyzer was The cable is positioned in a transverse slot in the chosen to measure road roughness. The local crew was pavement, which is then filled with epoxy. The passage trained in its use by a technician from the French of an axle produces an electric signal that varies with Central Roads and Bridges Laboratory. The APL 25 re- the load, and the reading is stored in an electronic cords results on a standard cassette, which is directly control box. The reading is calibrated using standard read by a digital cassette reader for automatic input loads. The cable needs a stable platform for accurate to the RMU's computer. The software, in addition to measurements. Because the pavements in Niger were expressing to road roughness on the normal CAPL 25 relatively light and flexible, the RMU decided to install scale, converts the results into the International the cable in the center of a 30m-long Portland cement Roughness Index scale, which is used as a standard concrete slab. Arrangements were made with the Euro- input to the World Bank's Highway Design and Mainte- pean Development Fund (EDF) to include the slab in an nance Standards Model (HDM). Complete surveys of ongoing EDF-fianced contract to widen and strengthen the paved road network in Niger were performed in a section of the main east-west highway. The electronic 1985 and 1986. recording system produces a histogram of the number of passing axles in five classes: 1 to 5, 5 to 9, 9 to 13, 13 to 16, and more than 16 metric tons. The legal limit Economic Data for a single axle in Niger is 13 tons, or 28,600 metric lbs. If the experimental installation is successful, similar Three groups of economic data are collected: the unit installations are expected to be made on other sections costs of construction, rehabilitation and maintenance, of the paved road network. for both periodic and routine maintenance by contract or by force account; vehicle operating costs; and macroeconomic and traffic forecasts. Road Inventory and Condition Surveys Pentakilometer (5-lan) markers were placed on all Data Input and Storage paved roads and they are generally accurate. However, road improvements that shorten the alignment can upset The RMU was instrumental in introducing electronic the accuracy of all subsequent kilometer markers. An data processing to the Ministry of Public Works. A list independent kilometer reference system was, therefore of equipment was determined in 1984 and the following established, and the existing kilometer posts were items were chosen at that time: incorporated into it. Most unpaved roads do not have pentakilometer posts. Distances on these roads were * a Victor S1 computer with 512 kbytes of memory measured with a precise odometer (Halda Twinmaster), and two floppy disks with 1.2 mbytes of memory, and special markers were placed. * an Alpha 10 computer with 2 x 10 mbyte cartridges A windshield survey is a conventional, detailed visual (Bernouilli Box). analysis that is performed in a car and, when necessary, on foot. Distances art recorded with the precise odo- meter, and the roadside kilometer markers were incor- Maintenance Policies porated into the measurements. The following three groups of data are recorded: First, a decision methodology was established. In 1986, 91 Niger: A Practical Management System to Programming Periodic Maintenance - A Case Study the software that automatically read and input the APL low-only about one-fifth of the paved network has an roughness data was not yet available. Therefore, ADT of more than 300 and the highest traffic volume decision criteria were used from the three pavement is less than 1,000 vehicles per day. condition evaluations of the windshield survey: surface treatment condition, cracking, and deformation. The Maintenance Model first two are indications of surface distress, and the third of problems in the pavement structure below the A simplified version of the World Bank's HDM was surface. A two-dimensional decision grid was, therefore, applied in Niger. The inputs to the model are the road developed based on surface distress, defined as the sum inventory (both fixed and variable conditions), traffic of surface treatment condition and cracking and data, economic data, and the maintenance policy deci- deformation. The types of maintenance intervention, sion grid. which ranged from routine maintenance to strengthening the overlay and rehabilitating the road, The model first sets default values for required HDM were then related to the cells in the grid as shown in input data that are not collected in Niger, and trans- Figure 1. forms the Niger survey ratings for surface treatment condition, cracking, and deformation into HDM units. The thresholds and the different types of maintenance This provides the initial condition for the simulation works in the decision grid were positioned on the basis which is run with a specified or null maintenance poli- of engineering judgment. The positioning of these cy. The model predicts the condition of the road section thresholds was the subject of considerable discussion at the end of the year, as a result of its initial condition between engineers from the government and the World and the effects of traffic and climate derived from the Bank. They considered engineering standards that were HDM equations that were calibrated to conditions in commonly used in Niger and West Africa, and the Niger. The predicted condition is then compared to the results of World Bank research in other parts of the maintenance policies to determine if work would be world. Because the great majority of surfaces and required on a road section. If so, the maintenance quan- pavements in Niger were in good condition, persons tities and costs for the section are calculated. Then, the who conducted the windshield condition survey tended updated road condition is calculated. This road condi- to rate the road severely. The grid therefore might need tion then becomes the input for the second year of the to be extended for use by other countries. Traffic was simulation cycle, which is repeated for the total number not explicitly considered in establishing the maintenance of years of the analysis. The simulation cycle for Niger thresholds for surface dressed roads as it is unsoundly was ten years. Figure 1. MAINTENANCE POLICY DECISION GRID Combined Rating of Condition of Surface Treatment Plus Cracking 0 1 2 3 4 5 6 7 8 0 Routine Iaintenance - - SBST- DBST Only 1II Deformation Patching Patching Rating 2 Patching and and DBST Only 3 SBST Strengthening Rehabilitation 92 Niger: A Practical Management System to Programming Periodic Maintenance - A Case Study The total vehicle operating costs over the road section been allocated in the investment budget to periodically for each year are calculated, depending on the forecasts maintain the road network. The general policy of the of both traffic and road conditions. The total transport government and the trend among foreign donors to lend costs, which consist of vehicle operating costs and money for road maintenance have both been strength- maintenance costs, are summed for all sections of the ened by the RMU analysis. Budgetary allocations for road link. The total costs are then compared for the null this purpose are now supported by several donors. alternative with other maintenance policies. Then, the costs are discounted to develop an economic rate of return for the investment in periodic resurfacing on the Future Development road link. The maintenance program that is currently being execu- It should be noted that this analysis is performed for ted was based on the decision grid of maintenance each homogeneous section of a road link. In practice, policies related to pavement condition. The next step in the type of maintenance applied can vary in roughly the program was to refine the decision grid. The vehicle 100m lengths. This level of analysis is therefore needed for this is a national transport study that is now in to produce as accurate an estimate as possible of the progress in Niger. One important element of this study quantities of maintenance works. is the installation of the full HDM program in Niger. This is now possible because the HDM has been restructured to run on microcomputers with the capabi- Contract Documents lities of the IBM AT. The network data in the RMU data bank will be used to examine the sensitivity of the For lots that consisted of road sections that do not need thresholds that trigger each maintenance task. A wide to be strengthened, the results of the RMU analysis are range of different policies will be tested and applied to sufficient to be directly incorporated in the bills of links and sections that are representative of the whole quantities in contract documents. However, although the road network in Niger. The economic results will then average costs of improving severely deformed sections be calculated. A series of iterations will enable national are used to permit the RMU to develop a program of maintenance policies to be refined. These policies can works and its economic justification, the level of ana- then be applied to the link analysis to develop annual lysis is insufficient to define detailed engineering for maintenance programs and budgets. construction. A conventional engineering study needs to be performed for such sections, including deflection testing and test pits to identify the cause of the Conclusions problem, and to permit the improvement in pavement structure to be properly designed. As was stated earlier, Niger is a country with very limited human and financial resources. It is, therefore, important that the best possible use be made of all Results of the Analysis public expenditures, including highway maintenance. The Niger Road Maintenance Unit can ensure that The Government of Niger has as a stated policy to pre- funds are spent on those projects that give the highest serve the large public investment in roads. Despite returns by using the methods and techniques described financial difficulties, a satisfactory level of funding has in this study.* The views and interpretations expressed in this paper are those of the authors an should not be attributed to the World Bank, to its affiliated organizations, to the Govenunent of Niger, or to any individual acting in their behalf. 93 Topic A: Case Study Nigeria: A Case for Increased Maintenance Spending on Federal Trunk Roads* The federal trunk road system in Nigeria consists km including 985 km of dual carriageways. The road of 29,500 km of roads of which 28,600 km are outside types are: urban areas. The replacement value of this system, excluding major bridges and urban roads, is estimated Asphalt concrete 15,509 km to be N18.5 billion (US$1.00=N4.8 in 1988). There has Surface dressed 7,251 km been a substantial improvement in the road system over Gravel or earth 5,811 km the last ten years. During that period, the proportion of bituminous-surfaced roads in the system increased The condition of the federal highway system is from 58% to 73% to a present length of about 23,000 summarized below: ROAD SURFACE TYPE Total Condition Length Good Fair Poor Paved (ki) Dual carriageway Asphalt concrete 985 845 120 20 Single carriageway Asphalt concrete 14,520 12,140 2,100 280 Surface dressed 7,255 2,950 1,940 2,365 Unpaved Gravel 4,300 - 430 3,870 Earth 1,510 - 1,510 TOTAL 28,570 15,935 4,590 8,045 (100%) (56%) (28%) The condition of the network has deteriorated since This neglect of maintenance and the failure to carry out 1985 because of financial and institutional constraints timely strengthening of roads over the last decade has affecting road maintenance and strengthening activities. already contributed to a loss of about N2.0 billion in the capital stock of the federal highways. Year % Good %Fair %Poor Road traffic declined between 1983 and 1987 in the wake of the 1982-83 economic recession and the ensu- 1985 62 15 23 ing financial crisis. It is estimated that road traffic 1988 56 16 28 at present is 15-20% below the pre-1983 levels. The Source: Adapted from a World Bank's Mission Report (1988). 94 Nigeria: A Case for Increased Maintenance Spending on Federal Trunk Roads - Case Study distribution by traffic class is as follows: Government's overall financial constraints. The FHD prepared a budget following their normal method but More than 10,000 veh. per day (vpd) 652 km this did not comply with the guidelines issued by the 1,500 to 10,000 vpd 10,800 lan Ministry of Planning and Budget, which indicated that 300 to 1,500 vpd 12,258 km the 1988 budget should not exceed releases for 1988. 150 to 300 vpd 3,360 km The budget in 1989 for federal highways was N315 Less than 150 vpd 1,500 km million but releases were only N210 million. The budget request for 1989 should therefore have been The aggregate inter-urban traffic on federal highways is about N210 million, but the FHD request for 1989 was estimated to be 60 million veh-km per day. The corres- N1,390 million which obviously was totally unrealistic. ponding expenditure by road users (the cost of opera- This request immediately covered only ongoing con- ting the vehicles) is estimated to be N62.6 million per tracts and projects on the point of award. day or N23 billion per annum. The extra costs incurred by road users because of suboptimal maintenance of The difference between available financial resources inter-urban routes are about N810 million per annum. and needs is so great that prioritization is essential. The The foreign exchange component of this extra expendi- budget request should show priorities so that if the ture in terms of extra fuel, tires, spare parts, and allocation is less than the request it can be rationally the wear and tear on vehicles is about N647 million accommodated. In addition, an economic assessment of per annum, mostly borne by the road users in the returns on each project would demonstrate to the private sector. decision makers the benefits that were being forgone from projects not included. In the case of federal highways these economic benefits are mostly very high. Maintenance Policy The following general priorities are proposed, basically on economic grounds: The basic maintenance policy of maintaining about 5,600 km of the network by force account, and the * completion of ongoing projects which are subs- remainder (24,500 km less sections under rehabilitation tantially complete (e.g., more than 85% complete) contracts) by contract is good. However, only some 11,000 km of the network received routine mainte- * other ongoing overlay projects nance, either force account or contract, in 1988. The problem does not appear to be so much a shortage of other ongoing rehabilitation projects recurrent budget, it is more the diversion of the recurrent budget to pay for capital items. * completion of other ongoing projects The management of maintenance needs considerable * upgrading gravel and earth roads to bituminous improvement. The techniques of assessing the needs, standard where it is justified by the volume of and planning, organizing and executing the works, are traffic weak and the Federal Ministry of Works and Housing (FMWH) should implement a sound maintenance mana- * new construction. gement system. The present system is largely one of reaction to crisis and works as long as ample funds are available. In a period of financial constraints it is a Consequences of Underbudgeting recipe for chaos. If the future funding for federal highways is continued A maintenance activity which is little employed in only at the level of the 1988 allocation, the pace of Nigeria is resealing, or bituminous surface treatment. deterioration will increase resulting in a high road This is a vital operation for preserving pavements, transportation costs with obvious economic implica- particularly in the higher rainfall areas. It appears that tions. Later, bringing the network back to a reasonably pavement resealing could be financed from the recur- good condition will be extremely costly. The conse- rent budget under the current budgetary practice. A quences of underspending on the rehabilitation of second maintenance activity which should be imple- federal highways are serious. By 1993, the condition of mented is a bridge inspection program. Bridges should the federal highways will have deteriorated to: 44% be regularly inspected for signs of deterioration, which Good, 21% Fair, and 34% Poor, resulting in a recons- can then be treated before there is a catastrophic failure. truction and rehabilitation backlog of N5.6 billion. In the meantime, the extra costs borne by road users will have risen to N1.6 billion per annum compared to NO.8 Budget Preparation billion in 1988. The wasted resources in road user costs over the five-year period will amount to N6.0 The Federal Highway Department's (FHD) present billion with a foreign exchange component of N4.8 budget preparation procedure is not related to the billion, assuming no growth in traffic. Thus, 95 Nigeria: A Case for Increased Maintenance Spending on Federal Trunk Roads - Case Study underspending on maintenance and rehabilitation by The extra road user costs will result in increased N4.0 billion over the 1989-1993 period will exact the transport costs which will be passed on to shippers and following toll: consumers in higher freight rates and passenger fares. The current condition of Shagamu-Benin Expressway is a good illustration of this situation where road transport Amount Foreign companies have announced their intention to increase Exchange their freight and passenger rates if the road is not Component urgently put back into good condition. In addition to the above road user costs, there will be time delays to Rehabilitation and Reconstruction N5.6 bn N3.0 bn passengers and in-transit inventory costs, which can Backlog: (if done after 1993) become very high for high value manufactured goods Extra Road User Costs N6.0 bn N4.8 bn and perishable agricultural commodities. (1989-93) Total N11.6 bn N7.8 bn Maintenance and Restoration Needs The program of road works to check further deteriora- In short, every naira underspent on maintenance and tion of federal roads, eliminate the maintenance backlog upgrading will result in three nairas in additional road over the next five years, and gradually reduce the reconstruction and user costs, with two of these nairas wasted resources in extra road user costs, as set out in in foreign exchange. detail above, is summarized in the table below. ANNUAL PROGRAM OF ROAD MAINTENANCE AND IMPROVEMENT WORKS (1989-1993) Work Item Objective Length Expenditures Annual of Road over 5 years Expenditure (km) (N million) (N million) A. Capital Asphalt concrete To provide adequate strengthening of 1,700 522 104 overlays roads in still fair to good condition. Reconstruction To eliminate the backlog of deferred 1,225 432 86 (surface dressed) maintenance on roads which have as a consequence deteriorated to poor condition. Reconstruction To eliminate the backlog of deferred 1,000 530 106 (asphalt-concrete) maintenance on deteriorated roads in poor condition which carry heavy traffic. Upgrading of gravel To reduce the excessive cost of vehicle 3,210 1,548 310 roads to paved standards operation on gravel and earth roads where justified by the level of traffic. Sub-total Capital 3,032 606 B. Recurrent Resealing To preserve roads in fair to good condition. 1,000 Annually 100 Routine maintenance To maintain an acceptable level of service 24,000 Annually 126 and prevent deterioration of the network Other maintenance Annually 47 Sub-total Recurrent 273 96 Nigeria: A Case for Increased Maintenance Spending on Federal Trunk Roads - Case Study Economic Justification The estimated economic rates of return for the five-year program of road maintenance and improvement program are summarized below: FIVE-YEAR PROGRAM (1989-1993) Work Item Road Length Total Length of Road (km) with (km) Expenditure Economic Rates of Return over 100% 30-100% 12-20% - AC Overlays 1,700 522 225 900 575 - Reconstruction 2,225 962 510 1,050 665 - Upgrading of Gravel Roads 3,210 1,548 215 1,265 1,730 to paved standards - Resealing (recurrent) 5,000 500 70 3,000 1,930 Total 12,135 3,532 1,020 6,215 4,900 These high economic returns provide a strong and clear difficult to contemplate additional taxes on road users justification for the proposed capital expenditures of in the current economic and political environment, full N3.8 billion (including provision for ongoing projects) cost recovery should be a medium-term objective in the and recurrent expenditures of N273 million a year over roads sector. The introduction of tolls on bridges and the 1989-93 period. On an annual basis, the proposed expressways, however, provides an additional source of expenditure of N760 million plus routine maintenance highway funding. Based on the rather simple toll expenditures of 273 million amounts to 5.5% of the schedule recently introduced and current traffic levels, value of the road capital stock and only 0.7% of DGP, revenues from bridge and highway tolls should amount a very reasonable level of highway maintenance and to about N66 million per annum (Lagos-1badan N20 improvement expenditures by international standards. million; Shagamu-Benin N10 million; Lagos-Badagry As a proportion of the total budget, this amount is less N10 million; Enugu-Port Harcourt N9 million; Obene- than was allocated in the late 1970s and early 1980s. Ajaokuta N2 million; Onitsha-Enugu N5 million; Bridges N10 million), provided there is no leakage of revenues. If the toll structure were set according to Bridging the Resource Gap distance travelled and raised to the level of cost savings over comparable alternative routes, it should be possible The shortfall in the needed expenditures on federal to increase the revenue to about N150-200 million per highways can be met through domestic resource mobili- annum. It would, however, be unwise to introduce addi- zation through road user taxes and tolls, and by external tional tolls if the condition of the toll highways is borrowing. At present the revenues from road user not first improved. In order to raise the efficiency of taxes (import duties and excise taxes on vehicles, tires, toll collection, and to reduce leakage of revenues, we spare parts etc) are more than offset by the subsidies believe that the collection of tolls should be contracted on gasoline and automotive diesel. While it may be out. 97 Topic A: Case Study Tanzania: Road Financing and Pricing Preface aggressivity on the rehabilitated roads, is between The purpose of this study is to demonstrate the extent 20%-30%. Despite the fact that the amount of to which the basic economic principles of road finan- investment or expenditures allocated to the transport cing, e.g., through road user taxation, as expounded in sector is directly related to the social and economic the seminar paper on "Road Financing and Pricing in development of a country, allocations directed to or Developing Countries" are relevant to or can be applied through the Ministry of Communications and Works to Tanzania. The extent and problems of applicability (MCW) have been declining over time. For example, are discussed in the light of the prevailing structure and government expenditure, both recurrent and problems of road maintenance as well as cost recovery development, in nominal terms on roads and bridges procedures in the country. declined from 5.2% of total government expenditure in 1976-78 to only about 2.6% in 1987-88. Between 1967- 68 and 1986-87, this share has been declining at an Introduction average annual rate of about 6.3%. Road transport is by far the most dominating mode of An equally important contributing factor to the general transport in Tanzania. It carries over 70% of the total poor performance in maintenance has been the uncoor- traffic available. Despite its importance, the road dinated and inadequately defined relationships between transport sector has constantly been faced with severe the MCW, Regional Authorities (for example Regional problems of maintenance and rehabilitation, leading to Engineers), and the Local Governments (District serious bottlenecks in the procurement and distribution Engineers). of goods and in passenger travel in the country. High operating costs, delays and safety risks are some of the The Government has launched a massive five-year outcomes of bad road conditions. The relatively rehabilitation and maintenance program of some major proportion of poor rural roads adds significantly to the roads in the country. Through this program, to which escalating operational costs of road transport. The poor the Government is fully committed, it is anticipated that performance in the transport sector in general and in about 70% of the paved and gravel roads should be in road transport in particular has largely been a result of reasonably good condition by 1992. For this purpose, the past neglect of investment and maintenance of roads the Government's investment budget share should both in terms of domestic budgetary allocations and increase from the present low level of 3% to about 15% foreign exchange. For example, while in the neigh- by 1991-92, after which it should stabilize at 12%. As boring countries the public investment program on for the rural roads sector, a "Core Rural Roads roads is around 15% of total, public investment, in the Rehabilitation and Maintenance Program" has been case of Tanzania it has averaged only about 3% in formulated by the Government for their systematic 1983/84 and 1987/88. Because of this fact and the improvement. About 25% of the 6,000 km of rural declining level of road transport services, the roads selected from 24 districts will be rehabilitated and Government has devised some measures in an effort to upgraded to gravel standard. Reclassification of these rectify the situation. roads will increase the gravel roads network by almost 55%. The rest of the earth roads will receive minimal maintenance due to their anticipated low traffic levels. The Need for Mobilization of Resources Since effective regular maintenance is equally important The country has an estimated total road length of for the rehabilitated roads to remain operational over a 82,000 km. Trunk roads constitute about 10,000 kIn, longer period, the balancing of development and out of which about 3,000 kn are asphalt-paved. The maintenance of the growing infrastructural (road) stock rest of the trunk roads are gravel roads traversing requires an optimal allocation of financial and technical certain regions and districts. Regional and district roads resources as well as improvement of institutional capa- account for about 21,000 km and 14,600 km respecti- city for the control and proper use of resources. The vely. The remaining 36,400 lan are rural (feeder) roads. institutions should be able to develop prioritization An estimated total of over 72,000 vehicles are currently schemes for maintenance implementation, particularly plying the roads of which the trucking fleet, comprising where capacity and resources are inadequate for total vehicles of different sizes and, hence differing work coverage. 98 Tanzania: Road Financing and Pricing - Case Study Current Road Taxation System road user charges expected to be collected in 1985/86 was Tsh. 3192.28 million compared to the amount ac- At present, the road user taxation instruments have a tually collected, Tsh. 1996.99 million or 62.6% (5). complex structure with a high level of inconsistency in This discrepancy is explained by lack of control and taxation rates, collection supervision and/or monitoring. monitoring resulting in undercollection, evasion and/or The instruments applied are registration tax, vehicle misappropriation. license fees, fuel tax, sales taxes on vehicle transfer, road toll taxes, import duties and sales taxes and In comparing revenues and maintenance expenditures foreign vehicle licence fees. A detailed account of the however, it should be noted that road taxation in complexity of each instrument is outlined in the World Tanzania is one of the principal ways of mobilizing Bank document entitled "Financial Performance of the resources for general revenue generation, as well as for Public Sector in Tanzania", A summary of road user road maintenance. revenues and expenditure between 1985-86 and 1987-88 is shown in Appendix 1. Annual Maintenance Requirements The total revenues collected through road user taxation amounted to Tsh. 1,996 million in 1985-88, compared Of the Tsh. 6,454.47 million total revenue collected in to Tsh. 6,454.47 million the previous year. Within the 1987-88, only Tsh. 2,652.71 million (41%) was alloca- tax regime road tolls contribute the largest proportion ted for road maintenance and the rest was contributed (34-40%) of revenue while motor vehicle registration to the general tax revenue. The subdivision of this contributes the lowest proportion (2-3%). expenditure is shown in Table 1 below. Development expenditure is relatively higher than recurrent The total revenues mobilized through these instruments expenditure from this source except for district roads. is much less than the projected theoretical levels. Total Table 1. SUB-DIVISION OF ROAD EXPENDITURES IN 1987-88 (Tsh. million) Trunk Regional District Roads Roads Roads Total Recurrent Expenditure 855.84 230.00 110.00 1,195.84 Development Expenditure 1,086.28 269.55 101.06 1,456.89 Total 1,942.12 499.55 211.06 2,652.73 Source: World Bank Tanzania: Financial Performance of the Public Transport Sector, Jan. 31, 1989. The road maintenance budget falls far short of require- trunk roads maintenance requirements, statistics from ments. At the same time, it has been established (World MCW (Appendix 2) indicate that a declining ratio of Bank) that revenues raised from road users during the allocation to the actual requirements will have to be past three years have been well in excess of expendi- compensated for in the future maintenance programs. tures on roads. Annual averages generally exceeded expenditures by a factor of about two. Hence road user The estimated cost of eliminating the nationwide taxes make a significant contribution to overall govern- backlog of road maintenance, in order to keep the road ment revenue. However, this positive balance was network in a stable condition, amounted to Tsh. 950 achieved through spending less on road maintenance million in 1985-86, rising to Tsh. 3,300 ,million in than was actually required in the long term to keep the 1986-87 and Tsh. 5,300 million in 1987-88. The routine roads in a stable, good condition. On an overall basis, and periodic maintenance requirements, making up a an estimated Tsh. 2,100 million should have been spent sizeable volume of total rehabilitation requirements, are on routine and periodic maintenance in 1985-87; the the activities that represent the largest backlog. comparable figures are Tsh. 5,200 million against Tsh. Organization and Sources of Finance 1,940 million actually allocated. A shortfall was also observed in 1987-88 where Tsh. 7,700 million was In order to avoid future cycles of road deterioration and required but only Tsh. 2,380 million was budgeted. On to reduce the financial gaps for maintenance, it is impe- 99 Tanzania: Road Financing and Pricing - Case Study rative that the agency responsible for the collection of Comparison of the Current Road Taxation resources be capable and well organized. Where user System with Marginal Cost-Based System charges constitute a significant proportion of actual maintenance expenditure, the scope for self-financing The current taxation system has some deficiencies for road infrastructure increases, i.e., charging for which would render the applicability of the marginal service under the cost recovery umbrella not only cost-based pricing system, despite its theoretical merits, augments road user revenues but also induces more difficult In the first place, current road user taxes do rational and efficient use of available resources. not accrue with the seven taxing criteria outlined in the Seminar Paper (page 7). The charging of road tolls at At present the Ministry of Finance, Planning and present varies with the weight of the vehicles, the Economic Affairs through its Customs and Sales Tax heavier ones paying more, but not with distance. This department, is the sole collector for the bulk of user takes only partial account of the vehicle aggressivity on charges. Another road revenue raising agency is the roads. Fuel tax, which varies less than proportionally to Transport Licencing Authority (TLS) under the MCW. aggressivity, is distorted further by the fact that diesel All the collected revenue is directed initially to the fuel is heavily subsidized by the lighter gasolines. This central general pool in the Ministry of Finance. runs counter to the marginal costing requirement that However, these two institutions appear to be less charges should rise in line with aggressivity. However, efficient in revenue collection mainly due to lack of the subsidization is deemed necessary by the Govern- qualified personnel and shortage of working facilities, ment, in order to keep the transportation costs bearable which usually result in low collection rates. to the majority of the customers who are largely agri- cultural producers scattered all over the country. The The Objectives and Structure of import duty and sales tax structure also is not directly Current Road Taxation System related to vehicle aggressivity, which is yet another departure from the marginal costing principle. At present there is no earmarking of resources for specific purposes, and there are also no binding require- Thus, the general structure of the road taxation--through ments for the allocation of resources. Each Ministry the various instruments and the heavy subsidization of prepares its budget which is presented and discussed in diesel fuel, together with the conditions that provide the Ministry of Finance. Usually the ministerial budgets loopholes for tax evasion and/or misappropriation--does have to conform to some predetermined ceilings. Accor- not meet the requirements for a short-run marginal cost ding to government officials some changes in this pricing principle. In short, it fails to meet the three policy are anticipated in the near future. However, marginal costing criteria given in Chapter II of the given the Government's commitment to improve the Seminar Paper. However, the second best alternative transport sector, there is need for a fresh look into the would probably be the adoption of the average cost question of earmarking and establishment of a "Road pricing principle that would at least, under the present Fund" for this particular Ministry. Earmarking has the conditions, ensure the recovery of all costs. The advantage that funds could be made directly available standard costs could be established and built in a "Road to the responsible ministry for the intended use. Fund" that would maintain a certain level of road However, it is often difficult to maintain such a "Fund" maintenance in the long run. because of the possible repeated "borrowing" from such revenues for other uses by the central government. At Another obstacle to marginal cost pricing, experienced the same time it would be necessary for the Ministry to to some extent in Tanzania, is the unrealistically low establish a certain level (cutoff-point) after which the pricing of road transport services required by the public "surplus" generated from the road user revenues would authorities which is common. Usually, officially con- be diverted to the central pool of the treasury. It is quite trolled rates fall short of operating cost coverage. They clear that, despite the government's weak fiscal are also standardized without taking into consideration situation, it is hardly possible to sacrifice the total road the different operating conditions in the country. Hence sector's contribution to the general revenue. there is need to permit rates to rise to the levels sufficient to cover not only operating costs but also Nevertheless, the contribution of some of these taxes, acceptable margins for own reinvestment and road user especially motor vehicle taxes, to total government tax tax contributions, perhaps through a "Road Fund". The revenue is expected to be only about 1.6% in 1988-89. reduction in operating costs following the resulting This share is translated into Tsh. 958.71 million, which infrastructural rehabilitation and maintenance should could be earmarked for the "Road Fund" without much protect the road transport user, partially if not wholly, distortion in the total government revenue basket. It from an increase in rates. Another possible revenue then becomes a real user charge. Contributions from raising measure would be necessary to broaden the tax- other sectors to the "Road Fund" are another possibility base to include all the direct and indirect beneficiaries considering the central role that the transport sector of road transport (although this is not a requirement of plays in supporting the other sectors. the marginal cost pricing theory). 100 Tanzania: Road Financing and Pricing - Case Study Modification of Road Taxation System in take into account distance as well as vehicle weight Accordance with Marginal Cost Pricing Principles (although this may raise problems of collection and administration). Finally, the Tanzanian fuel tax system, which allows subsidization of diesel fuel for the heavier The means by which the existing taxes, assessed above, vehicles, distorting even more the link with vehicle could be modified to bring them more closely into line aggresivity, should, perhaps, be reconsidered. with marginal cost principles. For example, license and registration fees for different vehicle types should be Changes in this direction would bring the curve of road sufficiently differentiated to take into account differing tax charges according to vehicle type more closely into degrees of vehicle aggressivity. In addition, axle load line with the corresponding maintenance cost curve as taxes which reflect vehicle aggressivity could be depicted in the diagram at the end of the Seminar introduced and enforced. Tolls should be restructured to Paper. References 1. Economic Survey 1987, June 1988, DSM. 2. Economic Survey, Various Issues, DSM. 3. Maro, W.E. The Current State of the Transport Sector in Tanzania: Tanzania Economic Trends (TET), Vol. 1, No. 4. 4. National Transport Policy (Drail), Ministry of Communication and Works, June, 1987, DSM. 5. World Bank; Tanzania: Financial Performance of the Public Transport Sector, January 31, 1989 6. World Bank: op. cit., (Appendix Table 6). 7. Customs and Sales Dept, Revenue on Imports for the Financial Year: 1987-88. 8. World Bank, op. cit. 9. Ministry of Finance, Economic Affairs and Planning, DSM. 101 Appendix 1: ROAD USER REVENUES AND EXPENDITURES 1985/86-1987/88 (Tsh. million) 1985/86 1986/87 1987/88 Amount % of Amount % of Amount % of rev. rev. rev. 1. Revenue A. MV Taxes & Licenses 72.11 23.2 99.56 27.9 94.74 20.9 MV Registration Tax 8.04 2.6 8.54 2.4 12.66 2.8 MV Transfer Tax 36.20 11.7 38.15 10.7 55.28 12.2 MV Road License 55.74 17.9 55.74 15.6 105.54 23.2 Road Toll Tax 122.88 39.5 137.63 38.5 156.08 34.3 Transport Licensing Fees 15.83 5.1 17.34 4.9 30.13 6.6 Sub-Total 310.80 100.0 356.96 100.0 454.47 100.0 B. Gasoline (Premium) Gasoline (Regular) 684.30 40.6 Diesel Fuel 20.63 1.2 Motor Vehicles 555.42 33.0 3500.00 6000.00 MV Spare Parts 214.56 12.7 Other Items 211.28 12.5 Sub-Total 1686.19 100.0 Total Revenue 1996.99 3859.25 6454.47 2. Expenditure Expenditure/Roads 1337.09 2191.81 2652.71 Contribution/Gen. 659.90 1667.44 3801.74 Taxation Total Expenditure 1996.99 3859.25 6454.47 Shortfall in Regular Maintenance (950.00) (3,330.00) (5,300.00) Source: World Bank Tanzania: Financial Performance of the Public Transport Sector, January 31, 1989. Policy Issues and Options Topic B: Management of Operations The inefficiency of road maintenance systems and poor * adopting appropriate technology and design stan- utilization of manpower and equipment have prevented dards and using local resources for self-reliance and investments in road maintenance from being fully sustainability methodologies that allow increasing effective in many Sub-Saharan African countries. decentralization. Effective and efficient management of operations is These issues and some options available for addressing crucial to addressing Sub-Saharan Africa's road deterio- them are discussed below. They are covered more fully ration problem by salvaging roads that have deteriorated in the three background papers prepared under RMI severely and protecting newer routes from a similar Seminar Topic B: "Operations and Management." fate. More effective management that produces demon- strable improvements in both the condition of roads and Accountability the efficient use of resources is also a key to creating the political commitment necessary to increase attention Problems to-and funding for-maintenance. It can also be a powerful tool for saving money, particularly foreign A lack of internal accountability impedes the effecti- exchange. veness of many road maintenance authorities in Sub- Saharan Africa. Designing and implementing systems Most road maintenance operations in Sub-Saharan to monitor a vast road network's condition and the Africa are run by large establishments operating by quantity, quality, and timeliness of performance of force account with geographically widespread opera- maintenance operations is difficult in all countries. tions that rely heavily on equipment. Maintenance It is, however, a key to effective planning and the operations planning and execution often overlap, and efficient use of resources-and crucial for convincing information systems are not adequate for management political and financial authorities of the need for to track the quantity and quality of performance or budgetary resources and the effective use of previous assess and prioritize needs. Maintenance managers have allocations. also been overburdened by the need to keep up huge- and often incompatible-equipment fleets and supervise Policy Options and Actions large, far-flung work forces. Information flow and streamlined management tasks are perhaps the two key Several steps can be taken to improve accountability factors in improving management efficiency. in road maintenance operations. One (discussed more fully under Topic C: Institutional Reform and Human This paper summarizes and addresses four key policy Resources Development) is structural: separating issues affecting the operation and management of road monitoring and planning from execution can strengthen maintenance and rehabilitation in Sub-Saharan Africa: both functions. The rationale for such a separation is similar to that commonly found on the financial side of * increasing accountability by improving information almost all government operations: those who carry out systems so maintenance managers can effectively tasks seldom have the time, the training, or the objec- plan and track performance. In many cases, this tivity to judge either financial or operational perfor- will involve separating responsibilities for planning mance. and monitoring functions from responsibilities for works execution; Separation of operations and their monitoring can take many forms. Some agencies will opt to develop cadres * adapting the size of mechanical equipment fleets to specifically trained in this function. Others will recast reflect maintenance potential and increasing the their organizational structures to concentrate on super- efficiency of equipment use by relying on private vision and monitoring while spinning operational func- contractors; tions off to contractors. Monitoring can also be ap- proached by creating an independent unit analogous to * spinning off management burdens through increased those that carry out financial audits, or by using private use of contractors; and firms. 103 Topic B: Management of Operations Whatever path is taken, a management information separately from highway maintenance operations, poor system will be required to track and analyze operational coordination-again, largely an information problem- progress. While computerized systems offer many often causes delays that further reduce plant availability. advantages in data collection, storage, and analysis, For most countries, foreign aid has been the major great care must be taken not to impose massive source of equipment and spares. That aid has some- amounts of new technology more quickly than often times also introduced unintended problems. Donors can be absorbed. Technology must also not be allowed have sometimes provided more equipment than coun- to divert attention from the more basic task of design- tries can efficiently manage; tied aid and international ing and organizing a system for gathering regular and tender procedures have prevented standardization of reliable field-level data. One lesson learned in both the equipment so that large and diverse spare parts stocks developing and the developed countries is that a cha- have to be created and coordinated, while technical ngeover to computer-based systems should be done in personnel needs additional training in operating and carefully phased steps. repairing equipment. African Experiences Policy Options and Actions A number of Sub-Saharan African countries make use Most countries will benefit from reducing and consoli- of maintenance management systems which can be dating their equipment fleets to a size and composition adapted to ensure the desired accountability for mainte- they can manage efficiently within the capabilities of nance operations. Maintenance management systems available staff, funding and support services. A smaller have been tested in Ethiopia, Ghana, Malawi, and fleet with higher availability and utilization rates Zimbabwe. However, these systems need to be supple- will save money while raising productivity and reducing mented with monitoring and evaluation functions. unit costs and management overhead. Equipment main- tenance itself can often be consolidated by creating In the U. K., for example, county road authorities have equipment pools as separate single-purpose management to publish annual reports that show their costs in units from which the roads authority can "hire" a plant. comparison with private contractors' charges. Beyond some point, consolidation and rationalization may make fleets too small to carry out all the work Increasing the Efficiency needed on the roads. Careful analysis-again, based on of Equipment Use good information and costing data-is then needed to assess whether some equipment maintenance tasks can Problems be cost-effectively contracted out. Many Sub-Saharan African country roads authorities are Outside firms can also be used to reduce a roads autho- trying-and often failing-to keep up equipment and rity's equipment maintenance burden. Plant and equip- vehicle fleets that are too large and too diverse to be ment can be hired from private sources, or private firms adequately maintained. Availability and utilization is can be contracted to maintain equipment. In countries very low; only about 20% of national road maintenance in which the private sector is not yet capable of entirely fleets is in working condition in some countries, and the taking over such tasks, this can be combined with pool- plant that is available often operates at only 60% or less ing some plant maintenance within the roads authority. of its normal work-rate. New equipment rapidly deterio- This can have an added advantage of creating a busi- rates because of inadequate maintenance, shortages of ness environment in which the private and public sector spares, and inadequate operator training. Most existing compete to foster efficiency. fleets cannot be run or serviced economically in their present condition. The result is a fleet with unnecessa- Private contractors that use and maintain their own rily high operating costs due to frequent breakdowns; fleets can be used for most road maintenance tasks this represents a large wasted investment, much of while a "core" fleet of equipment carries out essential which is in foreign exchange. works best managed by the roads organization. Equipment management problems are aggravated by Private fins may require strengthening to play an public sector financial controls and procurement regula- expanded role in contracting and equipment mainte- tions that hinder force account operations. Other rules nance, and governments may well find it economic to and regulations often prevent equipment managers from provide training in the requisite skills to build up their contracting maintenance and other jobs to private capability. Standardization of equipment should also be agencies. Information systems are often weak and sought, at least for the roads authority's fleet. Many understate the real costs of equipment ownership. countries need to institute firm policies and the disci- Where central mechanical departments are managed pline to maintain fleets of standardized equipment. 104 Topic B: Management of Operations Donors should assist in this effort by coordinating their invest in equipment and manpower that will strengthen support to individual countries to aid standardization their capabilities. Governments should consider offering and providing foreign exchange for spare parts. Stream- training programs to private contractors to increase the lining national procurement and supply regulations can skills pool. also enhance equipment management efficiency. Reviewing and, in many cases, simplifying contract management procedures, such as contract documents African Experience and specifications, can encourage firms to enter the market, as can improvements in the timeliness and The options mentioned above have been tried in various reliability of payment procedures. Increasing use of countries with mixed success. For example, in Lesotho private firms will increase the contracting authority's a government plant and vehicle pool was established in supervision and quality control responsibilities. 1972, but even until 1983 the management problems mentioned above persisted. To resolve these problems, realistic hire rates were set and revised periodically to African Experiences be in line with true costs. The fleet size was reduced by scrapping old unserviceable equipment and a core fleet Most countries routinely employ private contractors for maintained. Any additional equipment nefded were road rehabilitation and resurfacing works. The use of hired from private owners. This system proved s;uccess- contractors for routine maintenance is still uncommon, ful for plant hire. The combination of policy -cticns has although the "lengthmen" or petty contractors have been yielded positive results by reducing the effect iow engaged for specific road maintenance activities, funding usually had on equipment maintenance and including: operation in Lesotho. * the establishment of a rolling contract system with individual lengthmen recruited from villages along Increasing Use of Contractors local roads for maintaining some 7,800 km of road as part of the Kenya Rural Access Roads Program. Almost exclusive reliance on public sector force account operations for road maintenance has led in * The Gambia pilot project, which employed length- many countries to overstaffing, lack of incentives for men and petty contractors for road maintenance capable staff, rigid controls and rules that inhibit staff works. initiatives in adopting cost effective management solu- tions. While increased use of local contractors in road In Ghana, contractors using equipment-intensive meth- maintenance has been suggested as a possible solution, ods have traditionally been engaged for road rehabilita- many roads departments lack the capacity for engineer- tion. However, small contractors after four months of ing, tendering and supervision of maintenance contract practical training in labor-based road rehabilitation works needed to increase reliance on contractors. On techniques followed by two months of trial contracts, the other hand, domestic contracting and construction can each now produce, on average, 2 km of high industries are often underdeveloped. quality gravel road per month. A total of 19 such firms have been trained in the World Bank/UNDP financed The use of local contractors can increase efficiency and project, executed by ILO. The equipment needed was reduce costs if they can be mobilized to undertake road reduced to tractors, trailers, and compaction equipment. works. Market and competitive forces tend to act more This endorses the general policy of using the private strongly on private firms-especially small ones-than firms to reduce equipment fleets mentioned earlier. on public sector agencies. Their objectives are usually simple survival and profit and are not clouded by poli- tical considerations, and their relatively small size Appropriate Technology increases their flexibility. These factors motivate them and Local Resource Use strongly to use staff efficiently and maximize the use of labor rather than capital equipment to conserve resourc- Problems es. Although road maintenance techniques and organiza- tions in most regional countries have been geared to Possible Policy Options equipment intensive techniques derived from construct- ion and maintenance practices in developed countries, Stable markets and supportive policies are among the constraints on resources and the availability of under- most important factors in encouraging development of employed or unemployed labor, will often make the local contracting industries. If contracting firms know adoption of labor-intensive maintenance techniques they can expect work to be regularly available, they can economic. 105 Topic B: Management of Operations Maintenance budgets in most countries have been bridge-building-can bring about significant savings in shrinking in real terms and are causing increasing foreign exchange. proportions of resources to be devoted to salaries, with plant and equipment sometimes immobilized due to African Experiences lack of operating funds. The evidence from Sub-Saharan Africa increasingly points out that local resources, particularly labor, can be Greater use of labor-based techniques could lead to cost effectively employed for road maintenance and rehabili- savings and increased maintenance effectiveness. tation using labor-based techniques. In The Gambia, a pilot project on labor-based road maintenance has used There is also much scope for adapting design standards petty contracts and employed lengthmen to carry out to maintenance operations to take advantage of local measurable activities. The results show that such capabilities and local materials, thus saving foreign approaches employing small-scale, village-based con- exchange. tractors (men and women) are feasible and economic. The petty contractors quickly leamed the necessary Options for Action skills and effectively organized a number of workers for the jobs. However, this was possible with the develop- Where labor is available and can be motivated at daily ment of simplified procedures for awarding, control, wage rates of up to US$4.00, contractor or community/ and payment of petty contracts and for monitoring village-based maintenance crews can provide effective performance and productivity. low-cost road repair and maintenance. Considerable political commitment to using local resources such as Kenya, Malawi, and Ghana have also successfully labor exists in most countries, but this needs to be applied labor-intensive techniques in their rural road translated into practical administrative and technical rehabilitation programs. In Kenya, labor-based techni- programs. In most cases, it is necessary to phase such ques were successfully employed in the Kenya Rural programs through pilot projects of two or more years. Access Roads Project and the Minor Roads Project. Decentralizing the supervisory, administrative, contract- Malawi also presents a successful case of the applica- ing and payment authority required for increased use of tion of labor-intensive techniques for road rehabilitation labor-based techniques can often increase the efficiency in the Government's District Roads Improvement of such operations. This should be accompanied by staff Program. Ghana is also successfully undertaking labor- training, and the setting of standards for labor-intensive based rehabilitation of feeder roads which has complet- road works (tools, equipment and road materials). The ed high quality gravel roads 15% cheaper than by availability of local materials-such as timber for conventional methods, with up to 40% savings in foreign exchange. 106 Michael Leonard Equipment Management Summary * managers should be given authority to manage the equipment fleet and be accountable for it. Equipment availability and utilization is low in many equipment fleets in Sub-Saharan African countries-net * donors should coordinate their assistance programs utilization as low as 20% in some cases. Availability to provide a standardized equipment fleet and may be good when equipment is new, but declines provide foreign exchange for spare parts purchases rapidly as a result of inadequate maintenance, poor when needed. spares supply, lack of trained operators and mechanics and appropriate management. Some of the causes of The main policy issues addressed in the paper to poor equipment performance may be found in general improve equipment management in Sub-Saharan Afri- management and organizational deficiencies. These may can countries are: originate from a lack of qualified and trained staff, a lack of accountability and incentives within the govern- * to let the private sector have a larger role in provi- ment organization and a weakness in the management sion and maintenance of equipment for road mainte- information systems that understates the real costs of nance. equipment ownership. In addition, many equipment managers have unnecessary restrictions imposed upon * reduce the equipment fleets to a size that can be them in contracting repair work, hiring equipment or properly managed. obtaining urgent spares from the private sector. * donor commitment to a policy of in-country stan- Foreign aid can sometimes contribute to equipment dardization and foreign exchange support for spare management problems by making more money avail- parts. able for new equipment purchases, thereby increasing the fleet size beyond what can be managed effectively. Tied foreign aid and international bidding procedures Introduction introduce non-standard equipment into the fleet, creat- ing more spare parts, training, and management prob- Despite substantial foreign aid and technical assistance lems. to the roads sector in Sub-Saharan Africa, the equip- ment fleets used in road maintenance are not perform- The losses resulting from poor equipment utilization ing satisfactorily in terms of cost effectiveness and imply that there is an excessive plant capacity. This quality of service; the capital and the technical advice paper addresses these problems and proposes that: that have been made available have not been sufficient to bring about needed improvements in performance. * the equipment fleet should be of a size and compo- sition that can be properly managed. The route to improvement lies through institutional change and the application of new management poli- * the resources of the private sector should be used to cies, rather than through the provision of new resources. supplement government plant and equipment hold- Policies relating to pricing, cost recovery, organization ings. and the role of the private sector, as well as improve- ments in management and technical skills need to be introduced to obtain greater efficiency from already existing resources. In general the resources available, in terms of plant, vehicles and workshops appear to be Michael Leonard Is a consultant adequate: it is in their deployment that serious defi- with the firm T.P. O'Sullivan and Partners ciencies are evident. Oxfordshire, U.K. The paper Is edited and adapted by the SSATP from The size of the problem to be addressed is obvious an original text submitted by the author from anecdotal evidence and from what few surveys exist. Throughout the region there are examples of a 1989, SSATP - World Bank/ECA workshops full of broken down or cannibalized equip- ment, of fleets made up of widely different makes and types, and of shortages and mismatches in the provision 107 Michael Leonard- Equipment Management Table 1: ANNUAL ECONOMIC LOSS DUE TO EXCESS EQUIPMENT Annual Relative Utilization Fleet Size Annual Economic Loss (Hours) Required Basic Size of Fleet (USS millions) 20 50 100 200 1250 1 - - - - 1000 1.25 0.93 2.31 4.63 9.25 750 1.67 2.48 6.20 12.40 24.80 500 2.50 5.55 13.88 27.75 55.50 250 5.00 14.80 37.00 74.00 14B.00 Source: Haral and Eaton, 1986. of spare parts. In Sub-Saharan countries, 60-70% of the ment of plant could release funds from within these equipment may be broken down (e.g., Southern Sudan, very tight budgets to spend on materials and labor, the Tanzania). other major elements of road maintenance expenditure. An alternative way of illustrating the major financial In others, because of spares shortages or management gains to be realized from good equipment management problems, only 50% of available equipment is service- is to show the hourly costs of owning various types of able. And because of inadequate operator training the equipment at different levels of utilization (Table 2). plant that is used often operates at only 60% or less The difference between the 1000-hour utilization rate of normal efficiency and work-rate. This means that a (good) and the poor and very poor utilization rates significant part of the investment in plant, plus a similar common in Sub-Saharan Africa represent the losses due proportion of the investment in workshop tools and to underutilization, on an hourly basis. The economic support equipment, are non-productive in terms of life of these machines should be between 8,000 and actual work on the roads. It is not unusual to find that 10,000 hours: at current rates of utilization most of only 20% of total fleet strength may be actually work- these machines will be redundant or obsolete well ing on the roads at any given time. before they reach the end of their economic life. In financial terms this represents wasted investments of the order of US$2.5 million per annum for every Tackling the Problem US$10 million worth of plant in the region. Most of this wastage is in foreign exchange; if the equipment The large financial returns that can be achieved by that actually works on the roads was managed effective- introducing effective plant management are not ly much of this wasted investment could be released for achieved easily. Experience has shown that they depend alternative development programs requiring scarce upon institutional and managerial changes that are often foreign exchange. difficult to introduce, for they require the abandonment of profoundly entrenched biases in governments to- A 20% utilization implies that the investment in plant wards public ownership and administration of equip- is either much bigger than is necessary or that the fleet ment fleets. is bigger than can be successfully managed with the available resources. Either way the economic losses The principles to be followed in addressing the prob- from having fleets larger than can be managed effecti- lems of equipment management through institutional vely are enormous. Table I shows the economic losses reform are the following: incurred per annum at different rates of utilization and fleet sizes. Road maintenance budgets in most African * the fleet should be of a size and composition that countries are seriously inadequate; effective manage- will allow proper management. 108 Michael Leonard- Equipment Management Table 2. OWNERSHIP COSTS OF EQUIPMENT (US$) at Different Rates of Utilization Equipment Annual Ownership Costs 250 hr. p.a. 500 hr. p.a. 1000 hr. p.a. Relative Utilization Rate V. Poor Poor Good I Angledozer Cat D6D 30,900 123.6 61.8 30.9 2 Angledozer Cat D.8.L 73,300 293.2 146.6 73.3 3 Wheel Loader Cat 2m3 15,700 62.8 31.4 15.7 4 Heavy Grader Cat 16G 60,200 240.8 120.4 60.2 5 Heavy Grader Cat 14G 41,000 164.0 82.0 41.0 6 Maint Grader 120G 22,900 91.6 45.8 22.9 7 Tipper lxyland 7t 9,700 38.8 19.4 9.7 8 Tipper Leyland St 8,500 34.0 17.9 8.5 9 Landrover pickup 5,500 22.0 11.0 5.5 10 Road Roller 12t dead wt Aveling Barford D0012 10,330 41.3 20.6 10.33 the private sector resources should be used to have a fleet of plant and equipment that will never supplement government holdings of equipment operate effectively but simply clog their workshops and fleets. make expensive and extensive demands on their service organizations. funding arrangements should be secure and should take into account real costs. It is incumbent on fleet managers first to study the demand for vehicles and plant from their "customers", managers should have the authority to take deci- the users, and then to take a decision on what propor- sions and should be accountable for them. tion of the demand they are likely to be able to meet economically using their own resources. This assess- ment, balancing demand against resources, workshop Fleet Size and Composition support, spare parts supply, management skills, and trained operators and mechanics will result in a decision Fleet managers need to make fundamental decisions on on the size of fleet that can be operated with reasonable fleet size and composition from which other considera- economy. No larger fleet should be maintained. tions will flow, on the relationship with the private sector, on the establishment of workshops and spare In coming to a decision on fleet size the managers will parts inventories, and on staffing. Many mechanical have to take into account the effect of composition and departments have large, aging fleets of heterogeneous age. Fleet composition should be determined essentially origin that cannot be run or serviced economically. It is by the needs of the user, by the advantages of standard- a recipe for low utilization, high costs, and low stan- ization, and by the availability of after sales service dards of service--in short, a recipe for poor output, and from suppliers. Too often fleet composition is determi- for the low morale that follows and compounds it. The ned by aid donors, whose procurement policies are cardinal principle is to retain a fleet of a size that can designed with the needs of their domestic suppliers in be managed using available resources of staff, funding, mind, rather than effectiveness in the hands of recipi- and support services. It is pointless to retain 60 graders ents--hence, the familiar sight in Sub-Saharan Africa of when only 20 can be serviced and kept available, yet machinery of many different origins, much of it sup- there will be resistance to disposing of units that cannot plied as part of past highway construction schemes. be properly maintained. On the one hand, government This creates a considerable burden for the hard-pressed procedures for the "boarding" and disposal of vehicles fleet managers, who try to provide spares and train may be cumbersome and designed more to prevent operators, not for one type of grader or dozer with an fraud than to facilitate disposal; on the other, there is a effective local agent, but with three or four types, some natural tendency within ministries to accumulate rather with no agent within thousands of kilometers. It takes than divest assets. The result is that many ministries determination and considerable diplomatic skill to re- 109 Michael Leonard- Equipment Management fuse machinery when offered free with an aid package. of funding for training and support services/inadequate However, if it is not refused standardization will not be maintenance. achieved and the cardinal objective, that of establishing a fleet of a size and composition that can be economi- cally run and maintained, will elude the fleet managers. Projected Plant Availability It is equally important to have a reasonably young fleet. However, a decision to scrap a proportion of equipment units and reduce fleet size to a manageable level brings The corollary of this is that old units must be scrapped, immediately in its train the question: what if the size and a clear policy of scrapping when units reach a of an economically manageable fleet is too small to certain age must be adopted. It is impractical to expect meet the demands put on it by the road department? a maintenance workshop to keep an aging fleet on the This question is almost certain to arise since demands road without enormous expenditures of time, facilities, on the roads department fluctuate and are difficult to and spares. When a ten-year old machine is overhauled, predict. It is almost impossible to maintain a fleet that it still remains a ten-year old machine. Although most could meet all of the roads department's requirements of the wearing parts will have been replaced, the and still remain economic to operate. stresses and misalignments introduced in other assem- blies will continue to create a condition of unreliability The realistic response to this issue is to treat the when full power is restored to the machine. It is there- government's own fleet as the 'core fleet', and to rely fore not surprising, based on the experience in many on the private sector to satisfy demand peaks or special countries, that the availability of equipment falls rapidly requirements. In countries where there is no private with age. The graph on the following page shows data sector, this policy cannot apply (even so, there could from Botswana typical of the relationship between still be a 'core fleet' dedicated to the roads depart- equipment availability and age. ment's requirements, with additional demand being met by arrangements with other public sector bodies). In If a correct decision is made on fleet size and composi- countries where the private sector is weak, the 'core ion, it will be possible to create a virtuous circle: better fleet' would be large. In countries with a strong private maintenance/higher availability/higher utilization/more sector and a political environment not hostile to con- economic use of plant/better cost recovery/increased cepts of privatization, the core fleet could be small, and funds available for support services and training/ better in some cases might be confined to emergency and maintenance. This contrasts with the vicious circle often security services only. The concept of a 'core fleet', of seen when a fleet is large, old and heterogeneous: whatever size, raises the question of the appropriate inadequate maintenance/low availability/low utilization/ relationship between the government fleet and the uneconomic use of plant/inadequate cost recovery/lack private sector. Projected Equipment Availability 100 80 S,--- < 0 Grader 540 3. 35% 0 30 20 - I -per 10 - - - 110 0 1 2 3 4 5 6 7 8 9 10 Age. Years Michael Leonard- Equipment Management Using the Resources of the Private Sector such as overcharging or cartels being formed. Self- regulating bodies, who can speak and negotiate for their Once government has decided to use the private sector members, can also impose the discipline of fair trading for equipment provision, there is a range of options on their members-such as associations of equipment open to it, from full-scale privatization of the govern- suppliers or Chambers of Commerce. Some examples ment fleet to sub-contracting certain maintenance and of privately-supplied services which have proven training functions to the private sector. The pros and successful in Sub-Saharan Africa are: cons of privatization, as such, are beyond the scope of this paper, and are essentially a matter for political * Management contracts: Consultants have been used judgement. Of more relevance is the contracting out of to provide management and technical assistance a substantial part of the equipment ownership and main- services under contract. These services can cover tenance burden. Beyond the use of private sector the strengthening of the existing fleet management, sources to supply plant at times of overload, it is workshop management and training. The counter- possible to go further and consign a major and perma- part training of local managers which goes with nent part of the equipment requirement to the private such contracts should provide long-term benefits to sector; in other words to use the private sector to the organization, supply part of the core fleet. Maintenance: Regular maintenance contracts at The proportion of the goverment's equipment require- advantageous rates can be negotiated with private ments to be met through the private sector is a matter sector workshops for certain types or classes of for individual judgement, country by country, and will equipment. Similarly, certain specialist maintenance depend crucially on (i) the strength of the private sector services can often be advantageously contracted out. in each country and (ii) the willingness of government to allow public sector activities to be carried out by the * Spare parts supply: Government can insist on a private sector. A positive attitude towards private sector spare parts contract with a supplier when purchasing involvement can be very beneficial to the total equip- new equipment, thus effectively 'hiving-off' a part ment provision effort. of its stores organization into the private sector, saving on its own overheads (stores management), Conditions of employment in the public sector with, reducing the cost of spares (through agreed dis- typically, job security but low rates of pay, tend to counts), and reducing the amount of capital tied up result in a lack of discipline (staff cannot be fired), and in the stores inventory. low motivation (staff cannot be rewarded with pay increases and performance-related bonuses). It is * Training: The training of operators and mechanics difficult to sustain a results-oriented management can be carried out by the main equipment suppliers regime under the constraints of such staffing policies, and should be made the subject of a contract at the time of purchasing equipment. Equipment suppliers Secondly, there exists within a competitive private have a particularly strong incentive to provide such sector a wide range of special skills, equipment and training as they want to see their equipment proper- facilities no government organization can maintain at an ly used. They sometimes have very good training economic cost. Thus the selective use of private sector facilities both in Africa and in their home countries, facilities can greatly increase the scope and cost-effec- which can be considered as an extension of the tiveness of the government fleet. government's in-house training facilities. Use of the private sector can take two main forms: The general concept of cooperation with private sector equipment suppliers to augment and strengthen a * where the private sector provides a substantial and government's own organization is one which has great defined part of the total equipment requirement, as potential advantages for the government. Hovever, already described; and, such a policy must be carried out in an active way, seeking to identify and utilize all the benefits that the * where the private sector provides specific services private sector can provide. This will require a genuine to the government fleet and sustained commitment by the government. In this latter role the private sector can be particularly Often governments prefer direct control and will resist effective across a whole range of activities, but its such an approach. They may also be misguided by their effectiveness depends on the willingness of government present accounting systems which can understate the equipment managers to define their requirements with true cost of ownership by ignoring capital costs, omit- precision and negotiate contracts to obtain what is ting interest charges, and understating or ignoring required. It may be necessary to introduce some form overheads. When comparing costs with private suppliers of regulation into the private sector to prevent abuses, these elements are often ignored, as are the taxes levied 111 Michael Leonard- Equipment Management on private companies, and an unfair comparison of When they are successful, hire funds produce cost costs is made. Some examples of currently quoted consciousness among equipment managers. They also private and public sector costs are shown in Table 3. introduce a need in the equipment hire organization to keep all plants in working order so that it is available In Lesotho, hire rates are an accurate reflection of for hire. The scheme also generates funds for purchas- actual running costs. The Tanzanian rates are not, and ing spares and replacement equipment. Unfortunately, it is doubtful if the rates in Botswana capture all the many schemes have failed because they have been costs. These figures suggest that the government hire pressured to keep their rates down to reduce the cost rates frequently carry a large element of subsidy and (or, more accurately, the apparent cost) of road con- that the private sector, properly utilized, should not struction and maintenance and thus allow roads authori- involve the government in higher costs and through ties to stretch their budgets. Another reason for failure owning and operating its own equipment, than it bears. of hire fund schemes is that governments find it diffi- cult to resist using the large balances that often accu- mulate in hire fund accounts-balances that are needed Funding Arrangements to purchase replacement units-for other purposes, thus depleting the accounts and making timely replacement The key to successful equipment management is proper impossible. As with other matters connected with road funding, based on accurate costing. Most of the prob- maintenance, the success of a hire fund depends on two lems met with in the overstocked and under-utilized factors: government commitment to the concept and equipment pools in parts of the developing world arise determined management. from bad accounting and inadequate financial provision. The two are linked. If actual operating costs are not The hire fund system is the preferred method of finan- known then financial provision will not be made for cing equipment pools within the public sector because them. If there is no secure source of funds then there is it encourages realistic accounting, accurate cost recov- no incentive to keep accurate cost records or attempt ery, and economical management. The heart of a hire cost recovery. fund scheme is its accounting system. The microcom- puter has made accurate accounting a good deal easier It is only when true costs are available to management in recent years, and there are now a number of pro- that it becomes feasible to introduce cost saving mea- grams available that make it possible to keep full cost- sures. For example, it can be shown that it is cost- histories of equipment, item by item, so that hire rates, effective to pay up to 25% more for a machine that operating costs and fund balances can be kept continu- conforms to local standardization policy than to accept ously under review. a cheaper non-standard option. The most effective way, within the public sector, to External Funding encourage accurate costing and adequate cost-recovery is to set up a hire fund through which to finance all Aid-supported projects often appear to succeed in their equipment operations. In its simplest form a hire fund equipment management because, among other reasons, is a system whereby the user is charged a hire fee they have access to foreign exchange and operate fairly which is designed to cover the owning and operating standardized fleets of equipment. Access to external costs of the piece of equipment. funding enables the project manager to airfreight urgent Table 3: HIRE RATE COMPARISON (US Dollars)/Hour Lesotho Tanzania Botswana UK Equipment Govt Private Govt Private Govt Private Private 120G Grader 50 48 7.4 127 26 70 27 D.6 Dozer 55 58 11.3 127 33 90 29 112 Michael Leonard- Equipment Management spares and to circumvent many of the delays encoun- force. Two-way communication is beneficial at all tered with normal government procedures. Furthermore, levels; some of the best ideas come from those at the having a standard fleet of equipment enables the work bench who have a different perspective from that manager to minimize the types of spares carried, the of the manager in his office. amount of training needed, and investment in stock inventories. Training: Morale, as well as efficiency, is greatly improved by training. The ability to do a job well helps Donors may wish to broaden their support to include to develop pride in work and enhances motivation. As the entire roads sector equipment fleet. Their role would a rule of thumb 2% of staff time, as a minimum, then be to aid, encourage, and support the principles of should be devoted to training. standardization of equipment and to provide foreign exchange to purchase spare parts, either channelled Compensation: Although public sector salaries are through equipment suppliers in the private sector or rarely as high as those in the private sector, it is directly to the roads agency concerned. possible for the public sector to maintain parity if such aspects as pension, job security, leave, and subsidized housing are taken into account. If parity cannot be The Accountability of Management maintained staff will continually be lost to the private sector. Managers, however well motivated, will not be A recent evaluation of workshops in a developing coun- able to achieve good results with a work force consist- try gave private sector workshops a rating of 75% and ing only of those who are unable to get better jobs government workshops a rating of 35%. These were elsewhere. based on the value of spares fitted and the number of jobs completed under approximately similar conditions. Thus, by paying attention to the environment within Many, familiar with the problems of road maintenance which a manager works, by providing a clear picture of in Sub-Saharan Africa, will feel that these figures are reality through simple management information sys- fairly typical for the region. They indicate not only a tems, by providing continuous access to training both lack of financial resources for such things as the for him and his work force, and by ensuring that purchase of spares, but also deficiencies in management compensation packages, taken as a whole, are compara- and motivation. ble with those in the private sector, it is possible to create conditions conducive to good management. The Management and motivation of staff are difficult pro- fundamental conditions, for the continuation of good blems to deal with in public sector plant organizations. management practice are: Such organizations, when under-resourced are over- whelmed by the magnitude of their operational diffi- accountability of the manager for his successes and culties-constant cannibalization of equipment, and his failures, and workshops full of machines that are not going to move for months. This has a damaging effect on the morale * the freedom to take decisions and to act on them. of a work force that has been unable to perform effec- tively because of shortage of spares. In the long term the work ethic is eroded. The problems are largely created by lack of performance-based financial incen- The Impact on Road Maintenance tives, cumbersome bureaucratic procedures, and by lack of accountability in management. This paper has focused on equipment management, and has sought to draw attention to ways of improving the If management is to be accountable, it must be allowed utilization of equipment through institutional and to make decisions and allowed access to the resources management change. All of the approaches recom- it needs to do the job. These are easy prescriptions to mended here have been tried and proved successful in make, but difficult to act on within a civil service Sub-Saharan Africa. In Lesotho, for example, a pro- environment. However, progress can be made by gram of institutional support and management assist- attending piecemeal to certain aspects of the problem: ance resulted in an improvement (over a five-year period, 1983-1988) in availability from 44% to 81%, Management Systems Reality is always instructive, and in utilization from 43% to 70%. A similar program and plant managers should have access to information, in The Gambia improved both availability and which they can use to make informed decisions. Man- utilization from 50% to 90% in only two years. agement systems must be simple, relevant and clearly understood. Managers need to monitor workshop Such results can only have a beneficial effect on road output, equipment performance, spares turnover, over- maintenance. The spectacle of the district road engineer head and unit costs, repairs and equipment output who is responsible for 500 km of road, yet is only Management also needs to communicate with its work provided with the equivalent of US$5,000 to keep a 113 Michael Leonard- Equipment Management fleet of 35 items in good condition is, unfortunately, not and adopt a different mix of labor and equipment. More unusual. It is no surprise that little of his equipment labor-intensive methods of construction not only reduce works, and the road network remains in poor condition. the requirement for equipment; they also provide a more than proportional saving in foreign exchange, It would be far better, in such cases, to operate with a since the simpler equipment can often be manufactured core fleet managed within a plant hire fund, thus locally. A third option is to reconsider the mix of reducing overhead and improving accountability. To equipment held by the roads department; for example reduce to a core fleet size, some of the items might be by owning only a fleet of graders and supervisory sold to the private sector, and then hired back. The vehicles, much of the essential routine maintenance effect would still be positive, since the plant would activity can be carried out. Tippers, rollers, front-end remain within the country, but now within a sector that loaders, etc., could then be hired as and when resources could find the funding and the incentives to use it make this possible. efficiently. There is, of course, no avoiding the fact that under- In cases where the core fleet is too small to handle the funding of road maintenance will hasten the already work required, and funds do not allow the necessary serious process of deterioration of the road networks in hiring, there are a number of options open to a roads the region. There is no magical solution to problems of department. One possibility is to adopt the same lack of resources. The meager resources available, approach to the road network proposed for the equip- however, could go a great deal further-perhaps twice ment fleet; to establish a 'core network', or to prioritize as far-if they were deployed within an institutional the network on the basis of available maintenance fund- structure that encourage, rather than inhibit, good ing. Another option is to simplify the equipment used management. References 1. C. Harral and J. Eaton, 1986, "Improving Equipment Management in Highway Authorities in Developing Countries" - World Bank Transportation Issues Series Discussion Paper TRP2. 2. International Road Federation, 1987, Proceedings of Symposium on "Management of Road Equipment" - Las Vegas, Nevada, USA. 3. Audit Commission for Local Authorities in England and Wales, 1984, Report on Improving Vehicle Fleet Management in Local Government - H.M.S.O. 4. T.P. O'Sullivan and Partners, 1984, The Management of the Government Fleet Final Report Third Highway Project, Ministry of Works, Lesotho. 5. NORAD and the Botswana Roads Department 1987, "Roads in Botswana ". 6. Peat Marwick McLintock, Hashemite Kingdom of Jordan, Aman Jordan, 1984, "Maintenance and Repair Facility Study". 114 Jan de Veen Appropriate Use of Available Resources and Technology Introduction The effectiveness of road maintenance organizations is impaired by a number of factors which are largely beyond the control of the responsible road maintenance Road Maintenance Activities staff. Percentage Distribution Figure 1 shows the typical distribution of funds for road Emergency maintenance. Figure 1 reflects the current state of the road network in many African countries. A large portion of available maintenance budgets has to be spent merely on keeping the roads in a passable condition. Relatively limited funds are spent on preventive, periodic and routine maintenance. In general, the trend is that emergency activities increase PoutIne at the expense of periodic and routine works. Figure 2 shows a typical road maintenance expenditure Parlodic pattern. The proportion of maintenance expenditure going to wages of permanent staff has grown over the years to the point that this type of expenditure typically represents up to 50% or more of the total maintenance allocations. In lean years when road maintenance allocations are reduced, it is the equipment and running Figure 1 expenses which suffer as the permanent labor must be paid. The result is idle plant and underemployed labor. Community-based, labor-intensive road crews can provide effective low-cost road repair and maintenance in many Sub-Saharan African countries. Spinning rehabilitation and maintenance off to small contractors and village groups can also reduce the work load of Sub-Saharan African road maintenance organizations trying to cope with diminishing resources and crippling Funds for Road Maintenance foreign exchange shortages. In several African coun- Percentage Distribution tries, involving local people in the upkeep of their own Permanent Labor roads has improved transport networks while boosting local economies and raising rural skill levels. Jan de Veen is a Construction Technology Adviser with the International Labour Casual Labor Ovrheads Organization in Geneva Equipment The paper Is edited and adapted by the SSATP from an original text submitted by the author 0 1989, SSATP - World Bank/ECA Figure 2 115 J. de Veen: Appropriate Use ofAvailable Resources & Technology Establishing a labor-based system is not, however, easy The potential gains of using labor-intensive methods or quick. It requires both political and technical com- should not, however, be allowed to obscure the fact that mitment. Planning and testing are needed to discover such systems are not easy to establish and, because of the right mix of labor- and capital-intensive works for their necessarily decentralized nature, are usually more each country, region, and road type. Training is re- difficult to administer than systems based on the direct quired to develop organizational and supervisory skills single line of command typical of governmental road to direct a decentralized road maintenance system. maintenance organizations. Many African road maintenance organizations are Moving to labor-based maintenance and rehabilitation seriously overburdened. While the transport networks begins with firm policy steps that recognize the gains to for which they are responsible are expanding, shortages be made through decentralization and privatization of of equipment and transport prevent optimum use of large parts of the road repair function. This usually their work forces. Resource shortages prevent adequate requires devolving significant analytic, supervisory, routine maintenance programs, so that much of the administrative, contracting, and payment authority from work they carry out involves responding to emergen- the center to the regional or district level. Training may cies, rather than undertaking regularly scheduled well be needed to develop the skills needed to carry out preventive measures that have much lower unit costs. these responsibilities. Standards must be set for the Budgets that are shrinking in real terms force an sorts of roads and works that will come under the new increasing proportion of resources to be devoted to program, as well as for the types of tools and light salaries, and equipment must be kept idle to save on equipment that will be needed. The case studies show operating costs. that a high-level commitment is a necessary first step for making labor-intensive methods work. This paper argues that labor-based maintenance systems can make a significant contribution to alleviating these Given commitment at the political level, the engineering constraints. The experience of a number of Sub-Saharan task of designing and establishing a labor-based mainte- African countries (see attached case studies) shows nance and rehabilitation system begins with the gather- local labor, organizations and skills can increase the ing of data on the functions and conditions of the links effectiveness of maintenance while lowering its costs. in the national road network, traffic levels, and the human, material and financial resources available. The analysis should include data on equipment costs, The Scope for Labor-Intensive availabilities, and utilization rates and the effects of Maintenance resource constraints on performance under the existing system. Labor availability-including its seasonal Labor-based road maintenance and rehabilitation can be distribution in agricultural areas-skills, productivity, technically feasible, cost effective, and extremely and costs should also be assessed, as should the extent reliable in most African situations in which terrain and capabilities of small contractors and grassroots conditions are not extreme. Its major limitations are organizations. labor availability and cost. A thorough analysis of this data-often supplemented Labor-intensive methods are used for three major types by pilot projects-is needed to find a proper balance of works: routine maintenance by force account or among the tasks to be assigned to the parts of a new contract (see The Gambia and Kenya case studies); road maintenance and repair system. Figure 4 shows a large-scale periodic maintenance, rehabilitation and decision-making process that can be used to make construction by force account (Kenya) or by contract choices as to what mix of labor- and capital-intensive (Ghana); and routine maintenance by agreement with technologies should be used for individual projects. local organizations (Ghana). Figure 3 shows typical organizational structures for each of these arrangements. In most situations, this data does not yet exist Road maintenance departments in developed as well as Labor-based force account and contract arrangements developing countries are generally mission, rather than have drawn popular and governmental support in many policy, oriented and little given to analysis of their countries, as they combine a number of national devel- overall approach or the appropriateness and cost-effecti- opment goals by saving foreign exchange, improving veness of alternative technologies. Thus, management transport networks, and providing productive employ- and staff training in developing new perspectives and ment, particularly in rural and village areas. The analyzing the feasibility and costs of new approaches is success of arrangements with village organizations often needed. Institutionally, most organizations see depends greatly on local traditions and a community's little incentive for changing time-honored approaches, perception of the gains it will make by maintaining particularly when they involve the scope of their access to transport routes. command or authority. Again, political commitment to 116 J. de Veen: Appropriate Use of Avzilable Resources & Technology Figure 3: ORGANIZATIONAL ALTERNATIVES TO ROAD REHABILITATION AND MAINTENANCE District Ministry of Public Works/ Authority Roads Department 5) Agreements 1) Casual workers 3) "Lengthmen" (a) with communities supported by PWD contractors (routine (paid at reduced rates) supervision and maintenance of road (b) ith youth or woesn payment (force sections) (p self-e account) (c) self-help 2) Specialized 4) Petty contracts labor-based contracts for easily measurable (rehabilitation works) maintenance activities change must be strong to overcome this tendency These systems and principles need to be developed and toward inertia. established before they are applied on a large scale. A pilot phase of two to three years is indispensable for In addition to the ongoing performance analysis de- this purpose. Following the data-collection phase scribed above, information is needed on the capabilities discussed above, policies and procedures need to be of local organizations and construction firms to make developed in six key areas: decisions on how they can be incorporated into the revised maintenance system. A system must be devised * Planning and programming systems for programming and controlling these inputs, the types of roads that will be maintained and repaired by labor- * Disbursement and payments procedures based methods, and the timing and levels of mainte- nance that will be sought from each type of interven- * Procurement procedures tion. Much of this information can be assembled by mounting experimental pilot and demonstration projects * Management and control systems to test various approaches. * Technical and organizational training Implementing Labor-Based Approaches * The establishment of organizational and adminis- trative structures for a large-scale program. Alternative maintenance and rehabilitation systems based on a maximum use of labor resources must be Efficient and cost-effective labor-based programs may based on organizational and management structures and be impossible to establish unless sufficient attention is principles that are perhaps more sophisticated than given to all of these aspects. If, on the other hand, those used for equipment-based systems. the political and engineering commitment exists to 117 J. de Veen: Appropriate Use of Amailable Resources & Technology Figure 4: PLANNING OF TECHNOLOGY CHOICE Design: Suitable/ Can change unsuitable for nobe made? no labor-based approach yes yes Site condition suitable for no labor? partly Deterrnlne a~orll Deerin a ppropriate yes{ nx of labor and machine Is labor available? no yes Is labor m Assess wage rates ange 1and incentive schemes Ipossible yes positive change possible C an target be met by no yes labor-based methods? (base on actual performance comparison) possibly Pilot project test Output Quality Plan long term o Training o Number of workers o Management o Produivit negative USE EQUIPMENT INTENSIVE APPROACH negative positive positve (base on results 1 ' ' 7of pilot project) Make financlal and USE LABOR-BASED , positive econonic analysis APPROACH of labor-based vs. negative equipment Intensive 118 J. de Veen: Appropriate Use ofAvailable Resources & Technology make the required front-end investment in establishing maintenance system, although they may be minimal if proper systems and procedures, the experience of a agreements with communities and/or defined village or number of African countries has shown that sustainable youth organizations are negotiated. Regular and sus- labor-based systems can be successfully established. tained payment can also be negotiated with individuals or "lengthmen" (who may be grouped together) or In this context, the World Bank/UNDP financed and through petty contracts. ILO executed a project to establish a contractor-based, labor-intensive road rehabilitation system in Ghana. The Experience obtained in Kenya provides a good example project began with a two-year pilot phase during which of routine maintenance contracts with lengthmen. The a team of specialists provided extensive training and Kenya Rural Access Roads Program has established a coaching to government and contractor staff carrying rolling contract system with lengthmen on some 7,800 out a set of trial contracts. In each case, four months of km of road. The most important lesson learned from practical training was followed by a two-month trial this experience is that the system can effectively utilize contract period. The lessons learned in this process locally recruited village labor to maintain rural roads, were then applied to the design of full-scale contracts. and that the system is cheaper than conventional approaches both in terms of foreign exchange and cost Each of the 19 small contractors trained by this pro- per km. The degree of effectiveness of the system gram is now able to produce 2 km of high quality varies from excellent to average depending to a consid- gravel road per month using labor-based methods; on a erable extent on the level of support provided the yearly basis they are able to rehabilitate some 450 km. lengthmen. The type of support required includes the The contractors produce the roads at a cost 15% below provision of instructions to the lengthmen regarding the that of the previous capital-intensive crews; perhaps timing and priorities of the different maintenance more importantly, the foreign exchange costs of these activities and back-up in terms of timely and regular projects have fallen 40%, as the only large equipment payment, inspections, and tools replacement. used are tractors, trailers, and compactors. In 1985 this routine maintenance system was extended One key to the success of the program has been increa- to part of the country's classified road network. In 1989 sed efficiency on the part of the contractors themselves a study was undertaken to investigate a further expan- as a result both of the training and, importantly, the sion of the system to cover routine maintenance work support given them by the public sector through im- on major parts of the classified road network. provements in their cash flows and their supplies of tools and essential materials. Isolating these key areas In The Gambia, a pilot project on labor-based road for improvement was a direct result of diagnosis, maintenance has experimented with petty contracts and practical and needs-driven training, and feedback lengthmen. Using petty contracts for the execution of through the pilot process. different routine maintenance activities has been shown to be particularly promising. The project has demon- Using village labor for routine maintenance has two strated that it is feasible and economic to contract out major advantages, i.e., the costs of transporting equip- maintenance activities such as desilting of ditches, ment and materials is kept to a minimum, and a feeling gravel excavation, grass-cutting and materials hauling of local involvement and responsibility is generated as long as quantities for these activities are easily through both the employment opportunities offered local measurable. Small-scale, village-based petty contractors men and women and their ability to experience the without previous experience quickly assimilate the value of their work directly in terms of increased access necessary skills to organize a number of workers. to the national transport network. There are also signifi- cant indirect benefits. For example, small tool-making Since most of the routine maintenance tasks are similar and repair facilities often spring up, generating even to agricultural activities, village workers are already more local income, and significant skills and organiza- familiar with the work techniques and only require tional capabilities can be developed. basic instruction on work quantities and quality control to perform satisfactorily. Women, in particular, are very It is easy, however, to underestimate the amount of interested in part-time routine maintenance work near preparatory work required to ensure the success of a their homes and are very conscientious in carrying out locally-based routine maintenance system. The key their tasks. The crucial issue is to adapt the working areas mentioned above all need to be addressed to environment so that the contractors can perform without establish a functional organizational structure able constraints and with confidence in the employer. to provide essential back-up services in terms of super- vision and regular and timely remuneration. In The Gambia considerable effort has gone into the development of simplified procedures for the awarding, In most cases inputs in the form of money or food will control and payment of petty contracts, the monitoring be necessary to establish a continuous and sustainable of labor productivity in road maintenance on daily and 119 J. de Veen: Appropriate Use of Amilable Resources & Technology task-work basis, and the training of government staff in In choosing between different alternatives the guiding planning, programming, inspection and measurement criterion should be cost effectiveness, i.e., the best techniques suited to a petty contract and lengthman results for the lowest cost per kilometer. Maintenance approach. The Gambia case study elaborates on these engineers/inspectors should be trained in assessing systems and procedures. the feasibility of involving communities in maintenance work. Guidelines should be developed specifying In applying any of the alternative options it is crucial to government inputs and community responsibilities for consider how workers and their supervisors will be different categories of roads. Proportionally greater motivated in the long term. Incentives at all levels must community inputs will normally be required in the case be incorporated as part of the system to make it sustain- of access roads perceived to be of direct interest able. For workers at the village level, incentives may to the communities. Selection criteria for roads to not have to be in the form of money. If there is signifi- be supervised and supported by governments should cant local interest in the road or road section, some reflect the level of inputs provided by the communities. assistance in the form of tools, construction materials and supervision may be sufficient to mobilize workers. The role of the maintenance engineer/inspector is vital In these cases, planning and programming assistance in establishing a sustainable local maintenance system. can be sufficient to mobilize and direct village labor at He is the direct liaison between the communities and specific times throughout the year to bring the road the responsible government authority. It is essential that back into a trafficable state. This type of maintenance he is provided with the means to (i) regularly visit and would therefore be provided not as a continuous low- supervise the village workers, and (ii) follow up on level routine maintenance input, but rather as a sched- promises of remuneration/incentives made during his uled and directed community input involving a signifi- negotiations with village committees. cant number of workers two to three times per year. The purpose of this type of intervention is to put minor It goes without saying that the personality and moti- access roads back into trafficable state when they are vation of the liaison man is extremely important, most urgently required. The timing of such interven- particularly during the initial establishment phase of the tions should be discussed and agreed upon between system. His selection and training should be done with villagers and the supervising technical ministry, and extreme care. depends on technical, economic and social consider- ations. Naturally this type of maintenance intervention Conclusion applies primarily to access roads with very low traffic levels and where communities are prepared to provide It is clear that the utilization of local human and collective inputs to safeguard their level of access to the material resources for road rehabilitation and main- main road network. The Ghana case study discusses tenance can be advantageous financially, politically and some preliminary experience with this approach. technically. Locally-based maintenance systems mini- mize the dependence of maintenance organizations on Finally, in some cases, local interest may be great foreign inputs and foreign exchange. They create much enough that financial contributions or local taxes can be needed productive employment in rural areas as well as negotiated with the local beneficiaries. local skills and a local sense of responsibility for the road network. Spin-offs of using local resources for In all these cases, it is advisable for a technical road works include the development of the rural eco- line ministry to use local administrations in nomy because of cash earnings of local workers and the setting up and monitoring of locally-based possibilities for the development of local industry, for maintenance approaches. An ideal road maintenance example for the fabrication/maintenance of simple system that makes optimum use of available resources hand-tools or local forms of transport. would most likely comprise a number of different maintenance alternatives. The optimum maintenance Such systems cannot, however, be established overnight approach for a particular road or section would be nor should they be applied indiscriminately. While they determined by factors such as the level of maintenance can often make a significant contribution to improving service required (which would in turn depend on the the effectiveness of road maintenance, they should be function and purpose of the road), local interest in the applied as complementary approaches in situations road, the availability of local labor, and the general where favorable conditions for use exist. availability of human, equipment, and financial resour- ces. Figure 3 illustrates a possible combination of If the potential of local systems is to be realized, it approaches for different road types. is necessary: 120 J. de Veen: Appropriate Use ofAvailable Resources & Technology Figure 3. A POSSIBLE COMBINATION OF MAINTENANCE APPROACHES FOR A ROAD NETWORK OF DIFFERENT CATEGORIES OF ROADS A. MAIN ROAD OR TRUNK ROAD Equipment supported by labor (Emergency works, grading) * Contracts (Periodic maintenance) * Petty contracts or lengthmen (Routine maintenance) B. REGIONAL ROAD * Equipment supported by labor (Emergency works, grading) * Equipment supported by labor (Emergency works, grading) * Contracts (Periodic maintenance) * Petty contracts or lengtLzs m (Routine maintenance) C. DISTRICT ROAD * Equipment supported by labor (Emergency works, grading) * Force account (Emergency works) * Contracts (Periodic maintenance) * Labor-based/simple equipment (Rehabilitation works) * Agreement with communities (Routine maintenance) * Petty contracts or lengthmen (Routine maintenance) D. ACCESS/FEEDER ROAD * Agreements with communities (Periodic rehabilitation w.) * Self-help with ministry supervision and material inputs (Routine maintenance) * for senior government staff to be able to make procedures should, to the extent feasible, be rational choices between different approaches based decentralized to avoid inordinate delays in recruit- on costs and effectiveness. Facts on the costs and ment, payment, and contract award. Labor-based performance of such different approaches need to approaches are very vulnerable to these types of be known. These facts should be assembled partly delays. as a matter of routine and partly through experimentation. Considerable data on productivity * for minimum back-up services and inputs to be pro- and performance of labor-based approaches is grammed and delivered. available and can be used as a basis for experimentation. In terms of policy initiatives this means that a govern- * for senior and mid-level government staff and, ment commitment to utilize locally-available resources where applicable, contractors to be able to must be translated into practical measures that allow efficiently organize and manage large unskilled such resources to be used effectively. Investments need labor forces and negotiate agreements with village- to be made in training, experimentation, system devel- based organizations. For this, specialized, practical opment and low-cost but specialized hardware. A two- training is a prerequisite. to three-year establishment phase is sufficient to provide a solid basis for a large scale application of * for administrative systems and procedures to be these systems. During this period, high-level political at times modified to allow for the effective func- support is needed to modify policies and procedures so tioning of locally-based systems. These systems and local systems can function efficiently. 121 J. de Veen: Appropriate Use ofAvailable Resources & Technology Policy modifications may be required in relation to the mobilizing and coordinating a consortium of donors establishment of appropriate wage levels for casual who have continued to support the respective expanding construction and maintenance workers, recruitment programs over a period of 15 years. procedures, conditions of employment, procurement and decentralization of responsibilities for contracting and The current policies of donor agencies and financial payment. institutions encourage the development of local skills, the utilization of available resources, and the parti- As regards the specialist assistance and foreign cipation of rural communities in their own development. exchange inputs that will be required for the These policies are in line with the priorities expressed establishment phase of labor-based programs, the Kenya in most national development plans. This implies that experience has shown that it is feasible to mobilize in most cases decision-makers will find a fertile ground substantial funding for this purpose from a variety of for the mobilization of external funding and the donors. The Kenya Government has taken the lead in coordination of the donor community. 122 Richard H. Neale and Derek Miles Use of Local Contractors and Consultants Summary or by foreign consulting firms, with site construction work the responsibility of government employees or Road maintenance requires the analysis and solution of foreign contractors. An increase in the use of local a diversity of road deterioration problems, over quite contractors and consultants may result in more effective substantial distances and through a varied geological road maintenance and in more general national and social landscape. It is argued that local consultants economic and social benefits. and contractors have the potential to be more effective and efficient than government organizations and foreign It is unlikely that the simple act of transferring work firms. If carefully encouraged, local firms would be from ministries to local firms-from the public to the better suited to finding technical solutions appropriate private sector-will have a magical effect. The practical to local skills and resources, and to manage the work problems remain the same, although some of the effects within local commercial, social, and political may be enhanced or diminished by the transfer from constraints. This would depend largely upon creating one sector to another. The essential difference is, enterprising, problem-solving management cultures, in therefore, one of management. As a broad general- which management practices are carefully aligned with ization, local, private companies have simpler objectives the local commercial, social, and political environment. than public sector organizations; they have a sharper Road maintenance would form a basis from which and more immediate motivation, and are able to firms could progress to undertake a wider range of operate much more flexibly. These characteristics make work. them better suited to problem solving; they will be better at "doing more with less" (Willoughby, 1981). Suggested action plans include: encouraging the creation and management of a stable market, within Local firms are generally not sufficiently developed in which enterprises can flourish; sensitive management of size, numbers or substance to have a significant effect, the necessary organizational changes, especially the and so require an effective program of assistance. Since transfer of staff from government agencies to the local the objective is to foster development of enterprising, enterprises; formulation of effective forms of contract; flexible, problem-solving firms it is axiomatic that any and support for a program of training and consultancy, program of assistance must be directed towards self- preferably based on local institutions. development rather than subsidy and protection; that is, the emphasis of the program should be to reward Introduction successful enterprises while providing a minimum level of protection against risk. In most countries the design and supervision of road maintenance are carried out by government ministries There are four elements to be considered in developing a strategy for increased use of local firms: Richard Neale is a Senior Lecturer * the technical aspects of road maintenance, and the in Civil Engineering at managerial implications; Loughborough University of Technology, U.K. and * the potential benefits of the use of local firms; Derek Miles Is Director of Construction Management Programmes at * the problems and impediments to implementation: International Labour Organisation, Geneva analysis of the difficulties which must be overcome; The paper Is edited and adapted by the SSATP from an and original text submitted by the author * the action plans: recommendations for investi- o 1989, SSATP - World Bank/ECA gations and initiatives for sustainable development of local firms. 123 Richard H. Neale & Derek Miles: Use of Local Contractors and Consultants Technical Aspects of Road Mainte- should present good opportunities for local consultants nance and Managerial Implications to use their skills and local knowledge to produce effective solutions within the capabilities of local Government road maintenance has to be managed so as contractors. to provide an efficient public service. In the case of private firms it has to be managed to produce Such strategies are, however, difficult to supervise. commercial results. When design decisions are devolved, it is difficult to maintain national performance standards. Because the The geometry of roads makes construction work diffi- technical problems of maintenance demand some on- cult to manage. A long, thin road site stretched over the site decisions, these problems are, to some extent, countryside is much more difficult to control than a common to whatever organization does the work. The compact building site. Communication and supervision response of most government agencies has been to are more difficult, transport of people and materials codify their requirements tightly and explicitly, becomes a key factor, and it is likely that the site will imposing a system of standardization upon designers traverse a variety of terrain and ground conditions, and and constructors. This follows the practice commonly perhaps climatic variations. The social topography will used in developed countries, but in Sub-Saharan African also vary-pastoral, rural, village, urban. countries this may mean that available resources are concentrated in the maintenance of some roads to high Generally, maintenance work is more difficult to standards, and doing nothing at all for others. When manage than new construction. New construction works formulating a road maintenance strategy in circums- are designed to a fairly consistent pattern, and much of tances where resources are severely limited, it may be the work can be standardized, planned and organized in that uniform national standards have to be one of the advance. When roads deteriorate, they do so for a casualties of compromise. variety of reasons and in a variety of ways. Therefore, the general sequence of maintenance work is: investi- Similar problems arise in the supervision of contractors gate, diagnose, remove any deterioration, and return to on maintenance work. It is difficult to specify the work original standard (or perhaps a revised standard). Thus, in a way that allows for design flexibility, difficult to compared to new construction, maintenance work requi- measure it, and equally difficult for the contractor to res diagnostic skills and a relatively broad range of price it. These problems can be overcome, but it is construction skills. The scope for standardized solutions difficult to write contract documents that will provide and forward planning diminishes. the client with a sound basis for controlling the work, and yet be readily comprehensible to contractors. Normal maintenance has few technical difficulties. In the case of gravel roads, this involves such activities as periodic regrading, ditching, clearing culverts and so on. Potential Benefits from Over time this has to be extended to include repair of the Use of Local Firms potholes and minor repairs to structures and culverts and, in badly neglected cases, to substantial renovation Three quite distinct factors must be considered: with some reconstruction. Paved roads are more dura- ble, prolonging the period before they begin to show * the transfer of work from government ministries signs that maintenance is required. Thereafter, a main- and agencies to private firms-"the efficiency tenance pattern similar to that for unpaved roads factor"; develops, but the solutions are more technically complex, often requiring substantial items of equipment the replacement of foreign firms by local ones- and non-local materials and more difficult managerial "the national development factor"; and tasks. changing designs and construction methods to suit In developing countries, which have chronic shortages local needs, skills and resources-"the employment of many of the basic requirements of road maintenance, and economic growth factor". these problems may become acute. Technically, local firms who are familiar with this environment should be more efficient than foreign firms; their managers speak The Eficiency Factor the local language, know the local customs, and understand the topography and climate. Also, they will It is generally recognized that the administration of road be less constrained in their working practices than management in developing countries by government government agencies. Routine maintenance should ministries and agencies could be considerably improved. cause few technical problems, and they should be well There are many reasons for this, but as a generalization placed to mobilize local resources. Restoration of badly government road agencies are overstaffed, provide little deteriorated roads presents more of a challenge, and real incentive for their staff to perform well, work 124 Richard H. Neale & Derek Miles: Use of Local Contractors and Consultants according to rigid rules, and ignore or resist local needs practice chosen because their technical staff are familiar and representation, rather than respond to them. with them although they may be technically inap- propriate. It can be argued that the fundamental structure of such organizations is inappropriate. Usually conceived and structured along the lines of similar organizations in developed countries, they may lack the institutional The Employment and Economic Growth Factor characteristics essential to achieve good results in developing countries: flexibility of approach, a positive The main thrust of this argument is the prodigious and innovative problem-solving management culture, capacity of construction work to create low-skilled and incentives to do more with less. employment. The International Labour Organization has been one of the leading organizations in promoting this By contrast, the private firm has simple objectives approach to construction, through the implementation of (survival, profit, growth), recognizes the need to labor-based road construction projects, and by produ- motivate its staff to perform well (and has the means cing appropriate literature (Edmonds and Miles, 1984, and flexibility to do it), and-being market orientated and Allal and Edmonds, 1977). -is used to responding to local needs, provided that response is commercially profitable. In summary the potential benefits for using local contractors and consultants are likely to be: It is likely that local contractors and consultants could do a better job than government organizations using Political: a clear commitment to national devel- directly employed labor. Flexibility of action, and the opment, promoting economic growth, professional ability to respond to problems, may well produce better development and employment, and reducing depen- results than inflexible governmental organizations trying dency on imported goods and services; to satisfy a diversity of influences. In short, the private firm is motivated to succeed, and therefore is likely to * Economic: the economic benefits stemming from find imaginative ways to overcome obstacles to success, the above political commitment and the inherent whereas the governmental organization may be princi- benefits that accrue from a better road system; and, pally concerned with the application of standard proce- dures, to avoid taking risks and making mistakes. Cultural: stimulation of education and training, and the development of professions and professional institutions. The National Development Factor The arguments for replacing foreign firms with local Problems to be overcome ones are more clear-cut, and less controversial. First, it is a simple matter of national development to encourage The main problems to be addressed in the promotion of national professional and industrial growth. Strengthen- local contractors and consultants are: ing the professions is one of the key factors in increa- sing the use of local contractors and consultants. Creation of the market: an "enterprise culture" Professionally qualified people are a very scarce cannot be driven, it must be stimulated by market resource in Africa. Governments and aid agencies forces. devote much time, effort and money to education and training programs to relieve this shortage. Unless those Control: it is difficult to simultaneously promote who benefit from such programs find stimulating and initiative and maintain control, particularly with challenging work at home, they will either perform respect to construction quality control and cost of ineffectively or find work abroad, leaving their works carried out by contractors. countries more dependent on foreign expertise. Effects of organizational change: redundancies or Secondly, and equally important, local firms are likely overstaffing in road agencies; staff compelled to to be more effective technically-effectiveness being undertake tasks for which they are not qualified; judged on the basis of producing solutions to road and the reality of local business practices. maintenance problems with a minimum consumption of scarce resources such as plant and equipment, imported Time frame where there is little existing local materials, and skills possessed only by a small minority. capacity, the time required to see the results of By contrast, foreign firms may be constrained to apply policies which encourage more use of local firms standard solutions, designing and building to codes of will be very long. 125 Richard H. Neale & Derek Miles: Use of Local Contractors and Consultants Creation of the Market operating problems if they do not have a regular and adequate cash-flow. This situation offers a significant It is clear from the various studies that have been done comparative advantage to strongly-capitalized multi- on the state of local contracting and consultancy national construction enterprises (Lemunge, 1980). capacity that it is generally very weak and fragmented (World Bank, 1988, Edmonds and Miles, 1984). This is Fluctuating work load. In most Sub-Saharan African an indication that the market for construction design countries the funds allocated for road maintenance will and contracting services does not provide a suitable fluctuate from year-to-year, sometimes quite widely. commercial environment within which local firms can flourish. Some possible reasons for this and the effects on the proposed use of local firms are discussed below. Control Political philosophy and structure. One of the most In any project, there are three elements to be controlled: important factors in the creation of a domestic Inany , the ae thme nts toebe contl contracting and consultancy capacity is a stable market, quality, cost and time. To control these elements, otherwise there may not be an "enterprise culture" and project managers need information, kaowledge, skills, much would have to be done to create an environment authority, technical and management systems and muchwoud hve t bedon to reae a envronent resources. Generally, in Sub-Saharan Africa, there are which encourages people to become entrepreneurs. This reo.e.Gnrly nSb-aaa fia hr r myimply that some substantial change is required in shortages of all these except, perhaps, authority. One may ic phloso o the goene result is that local professionals feel disadvantaged in the basic philosophy of the government. comparison to their foreign counterparts, and so lack Donor policies. Aid tied to the use of goods and the confidence to build their own businesses and services from the donor country is common, and often compete on equal terms. A further factor that under- has the effect of limiting the market for local firms to mines confidence is that information and knowledge that of suppliers of local services as subcontractors. acquired from developed countries is much more highly Furthermore, the requirement that plant and equipment prized than that which relates to local conditions. Thus has to be acquired from the donor country creates a a strong initiative is required to "localize" education, severe problem of maintenance. Countries, receiving aid training and professional development. Good systems from several donor countries acquire such a diversity of for drafting contract documents, contract administration, machines that training their mechanics to be proficient and the control of payments are crucial to effective in repairing all of them, and holding sufficient spare control of maintenance and construction work. A con- parts, become impossible. Similar problems arise if the tractual system that has simple requirements, simply aid agency insists on international tendering for stated, and capable of simple measurement, is a better equipment. This process is in complete contrast to the foundation for control than a legally complex document management practices of major international contrac- employing sophisticated concepts and measurement sys- tors, who rank standardization very highly in their list tems. Much work remains to be done on this problem. of purchase criteria. Consultants, who design and supervise, have tradi- Clients' requirements. Technically complex or large- tionally been separated from "contractors", who scale projects are generally not suitable for design and construct what the consultant has designed. Many construction by small under-capitalized local firms. construction clients throughout the world are moving Usually, the technology is too advanced, or the scope away from this traditional form of three-corered too wide, or the risk too great given their experience adversarial relationship. Control will be more easily and skills. exercised if road maintenance contracts are structured in such a way that encourages client, designer, and Form of contract and contract documents. The form of constructor to work together towards a common contract is often derived from those used in inter- purpose. national contracts, or in developed countries. Usually, this requires a level of commercial sophistication, risk- taking, and contract administration that most local firms Effects of Organizational Change cannot meet. The contracts are usually heavily weighted in favor of the client, usually the government. It is likely that greater reliance on local contractors and consultants will require expansion of existing firms Uncertain payments. It is common for Sub-Saharan under the new stimulus; inducement mechanisms to African governments to manage their cash crises by encourage the transfer of government staff to existing delaying payments to consultants and suppliers. This firms; and inducements for complete units of govern- can be disastrous for small, fragile businesses. Contract- ment staff to create firms. The staff of government ors find it difficult to obtain credit, and suffer severe organizations that might become redundant as a result 126 Richard H. Neale & Derek Miles: Use of Local Contractors and Consultants of contraction of government activities may be classi- Time Frame fled as follows: It has been shown that local consulting and contracting * Potential design consultants: the more technically capacity in Africa is, generally, weak (The World Bank, able designers, those with some flair and confidence 1988a and Edmonds and Miles, 1984a). The Road in their own ability, and also those who have good Deterioration Study (World Bank, 1988b) indicates that relationships with such people in the private sector; most government organizations are overstaffed and that their equipment is underused. Thus a policy of transfer- * Potential contractors: the more enterprising ring work from the government organizations to local, of those members of staff who have been involved private, firms would have the effect of moving the work in the supervision of construction, who have good from a sector of the economy that has surplus capacity contacts in both client and contractor organizations, to one with inadequate capacity. It is likely that a well- and who will be prepared to move with them; managed program for the development of local firms will increase the capacity of this sector- supported, of * Younger people, who have no special leaning, but course, by more general development programs that who will be reasonably adaptable anyway; stimulate the expansion in numbers of educated and skilled people. However, this natural growth will have * People in neither of these three groups, but who a very long time frame, so more immediate action will would be useful members of staff of a much redu- have to be taken to transfer significant numbers of ced road agency whose purpose was constrained to government staff to the newly emerging private overall road transport planning, and the employment companies, or to form sections of the organization into and control of design and supervision consultants; new, private firms. Thus, to achieve results in a and, reasonable time, it will be necessary for the program to incorporate a large component for accelerating * Others, whose skills and attitudes would not make organizational change through intermediary institutions them easy to fit into any of these new positions. of various kinds. Assuming that the organizational changes were mana- This problem reflects the growing concern of many ged effectively, with sensible inducements, there should officials working for development agencies, i.e., the be only real problems with the last class of employees, time frame of many projects is far too short. The Thus the magnitude of the problems under this heading working environment for many projects in the Sub- will be directly related to the number of people in this Saharan African Region are such that projects take time last class. A careful study must be done of the way in to mobilize and mature, and this period would be which local firms really operate within their own usually much longer than the two or three years that is commercial and social structure. Generally, individuals usually allowed. will have strong social and cultural identities, beliefs, motivations, and obligations within social systems that have developed over centuries. These may be Action Plans principally those of familyhood, tribe, and a complexity of other influences. Business practices are likely to be The purpose of these action plans is to suggest, in more strongly related to the parameters of these systems broad terms, what investigations and development than to Western microeconomic theory. Perhaps, if all programs will be necessary for the effective devel- the determinants were clearly understood, the theory opment of local design and construction firms. The would still apply. It is necessary, therefore, to conduct prime concern of such programs will be to foster the serious research to identify and understand these development of organizations which have determined, parameters. enterprising, and problem-solving management cultures. Logically, this must begin with the development of the Development strategies such as "the introduction of market. modern management practices " must be viewed with some concern. What is needed is a careful study of Market Development existing management practices-which may work reasonably well if the economic context could be Work must be made available to firms in a form that improved-and then to work with local people to they can do without undue strain, within an acceptable improve them. Obviously, a relatively large number of level of risk, and within the knowledge, information, firms will be more difficult to control than a few larger skills and resources available to them. This has ones, so this is another crucial issue. technical implications, requiring a move towards 127 Richard H. Neale & Derek Miles: Use of Local Contractors and Consultants smaller projects (or the subdivision of large ones) based effective control procedures are in place. This implies on local technology, and using appropriate construction both the development of appropriate forms of contract techniques. and training of supervisory staff such as clerks-of-works and inspectors. Unless and until the market for road maintenance becomes stable, with a sufficient and foreseeable annual A program of research and development into appro- demand, it would not be prudent for firms to concen- priate contract forms is crucial. The World Bank has trate solely on maintenance work. For most firms some been particularly active in this area, emphasizing fair diversification into related forms of construction activity contract procedures and its willingness to encourage will be necessary, so the program must take a broader "slicing and packaging" of larger projects (World Bank, view. Maintenance work should be seen only as a good 1986). Road maintenance is intrinsically different from basis for new firms to establish themselves and for new construction, and further innovation is necessary to existing firms to develop. formulate a system of contract administration which sets objectives that are easy to perceive and devises External support for the program should be aimed at ways in which results can be easily measured. stimulating enterprises, rather than at protection. The introduction of stabilizing measures, such as funding that would provide an assurance that an adequate Facilitating Organizational Change number of projects would be available regularly over a substantial period of time, with timely payments, can The development of local consultants and contractors help reduce risks, should lead to a reduction in the size of government Given the difficulties that local firms face in getting organizations. finance and credit, some form of assistance will be One of the difficulties is the transition period, and this necessary. This need not be in the form of subsidies, may have a fairly long time frame. There are two dis- grants, or soft loans, but simply a system of making tinct elements: the "efficiency factor" indicating a finance and credit easier to obtain. Typical financial and tint elempas: the govermen t toriatinns other constraints faced by small-scale contractors transfer of emphasis from government to private firms; seeking to establish themselves in the construction and the "national development factor" mndicating the seekng o etablsh hemelve intheconsrucion substitution of foreign firms by local ones. It may be market, as well as experience in measures to overcome them, are discussed in the ILID publication "Guidelines impractical to work on both of these aspects at the for the development of small-scale construction enter- same time, in which case a decision on priorities will prises" (LO, 1987). have to be made. One of the main problems is that construction is The need to study the social and cultural dimensions of perceived (frequently correctly) by most commercial development programs has become widely accepted. In banks as a high-risk business. Routine road maintenance a program aimed at mobilizing local contractors and contracts should offer a lower-risk entrepreneurial consultants, this element will be vital. It will opportunity than new construction, since the work be necessary to discover the principal motivators of content and hence the cost are more predictable. It is in consultants and contractors, what risks they are the interest of clients to ensure that financial risks are prepared to take, how do they attract, motivate and minimized by committing themselves to prompt and control their staff. Equally careful and thorough studies regular payments. Careful thought needs to be given to will have to be done to design schemes for the transfer devising equitable methods of calculating payments due of staff from the government to the private sector. and ensuring that maintenance contracts are let only when there is a reasonable guarantee that funds will be available to honor payment applications promptly. Institution Building In a program aimed at finding local solutions to local Measures to Secure Effective Control problems, local institutions obviously can take a major part. Experience has shown that successful institutional Where road maintenance is executed on a force account change depends on a concerted action by those involved basis, control structures are largely internal to the public in the industry-clients,consultants, and contractors. sector organization which is responsible for setting the Governments also have a major part to play. As the task and carrying it out. When private consultants and predominant clients of the industry, governments can contractors are brought in, the situation becomes more take a strong position to promote the emergence of complex. The potential for an improved and more eco- capable and well-motivated domestic construction nomical service will only be achieved if simple but businesses and consulting firms. 128 Richard H. Neale & Derek Miles: Use of Local Contractors and Consdtants The contribution of local institutions would include: The ELO has formulated the concept of "Results- Orientated Training Activities" (ROTA), in which short * research and development projects on appropriate ICT-based training sessions are interspersed methods of design and construction, leading to more with practical implementation under the guidance of realistic design and better control; experienced advisors. The emphasis is on achieving * providing information, advice, and skills through measurable results through the application of appro- consultancy; priate management skills. It would be possible to take this approach further by adopting a "franchising * devising and running effective and practical training approach," in which each model enterprise would be programs; and provided with a package of managerial tools (such as costing systems) which could be modified to suit * establishing a focal point for professional devel- individual needs. opment. Appropriate training will be essential if customer- oriented attitudes are to be inculcated. The Io Concluding Remarks Inter-Active Contractor Training (ICT) methodology (Hernes, 1980) has been designed specifically to This paper has given a broad review of factors that will encourage owners and managers of small-scale cons- be important if road maintenance is to be transferred truction enterprises to work with, and learn from each from government organizations to private consulting other. Each module of ICT training material contains and construction firms. No specific strategic "blue- learning texts, together with worked examples, exercises print" has been proposed because there is a clear need and simulations to reinforce the learning. There is scope for more information before this can be done. Technical for developing ICT modules to meet the specific needs studies will be necessary to quantify such variables as of road maintenance enterprises, which could be modi- the potential size of the market and the numbers of fied by local institutions. This could be supplemented professional and skilled people available. Social studies by manuals and handbooks on road maintenance prac- will be necessary in order to ensure that development tice, along the lines of the ILOITDG manual on build- assistance is designed to provide realistic and accept- ing maintenance (Miles and Syagga, 1976). able results. 129 Richard H. Neale & Derek Miles: Use of Local Contractors and Consultants References 1. The World Bank, 1988c. Sub-Saharan African Transport Program, Road Maintenance Initiative, Project Brief. Washington, DC. 2. Clell G. Harral, 1986. The road deterioration problem in developing countries: organization and management of road maintenance. Paper submitted to the US Transportation Research Board Annual Meeting (Available from the World Bank). 3. The World Bank, 1988a. Development of consulting capacity in Africa. Various papers. 4. The World Bank 1988b. Road deterioration in developing countries: causes and remedies. A World Bank Policy Study, Washington DC. 5. Christopher R. Willoughby, 1981. Infrastructure: doing more with less. Finance and Development. 6. G.A. Edmonds and D.WJ. Miles, 1984a. Foundations for change: aspects of the construction industry in developing countries. Intermediate Technology Publications, London (on behalf of the International Labour Organization). 7. A. Allal and G. A. Edmonds, 1977. Manual on the planning of labour-intensive road construction. ILO, Geneva. 8. ILO. The Rainmaker. A booklet published by ILO, Geneva. 9. N. Lemunge, 1980. Report of the workshop on financial constraints on the development of small contractors in Eastern and Southern African countries. Report of an ILO seminar held at Kitwe, Zambia, August 11-15, 1980. 10. International Labour Office, 1987a. Guidelines for the development of small-scale construction enterprises. Geneva. 11. The World Bank, 1984b. The construction industry: issues and strategies in developing countries. Washington, D.C. 12. Jerry M. Silverman, 1984c. Technical assistance and aid agency staff: alternative techniques for greater effectiveness. World Bank Technical Paper No. 28, Washington D.C. 13. Tor Hernes, Edited by Derek Miles, 1988d. Training contractors for results: a guide for trainers and training managers. ILO, Geneva. 14. Derek Miles and Paul Syagga, 1987b. Building maintenance: a management manual. Intermediate Technology Publications, London. 130 Topic B: Case Study The Gambia: Pilot Labor-Based Road Maintenance Project' Summary The systems utilized labor recruited in the villages along the road network. The first system was the The maintenance of The Gambia's road network is the lengthmen arrangement whereby a single person is responsibility of the Department of Technical Services engaged to carry out all routine maintenance on a (DTS) (formerly Public Works Department) within the particular section of road. The second system was that Ministry of Works and Communications (MOWC). The of petty contracts. Under this system one or more maintenance responsibility of DTS includes all the routine maintenance activities are contracted to a primary and secondary roads of The Gambia, which in village-based contractor organizing a group of workers practice means all the paved and gravel roads and over a longer section of road. certain principal earth routes throughout the country. The network of roads to be maintained by the DTS in Productivity data for "daywork" and "taskwork" condi- 1987 comprises 1,471 km of which 538 km are paved tions were assembled during the pilot project. A and 933 km are gravel/earth roads. comparison of the two alternatives shows a significant improvement in output under taskwork conditions DTS, with technical assistance from the International ranging from 14% to 137%. Taskwork recommenda- Labor Organization (ILO), has since January 1989 tions for lengthmen and petty contract conditions have carried out a pilot project on road maintenance. This been prepared based on the monitoring results of the project has been jointly financed by The Gambian pilot project. Government and the ILO from resources made available by Swedish International Development Authority Systems and procedures for recruitment, payment, (SIDA). The pilot project was reviewed in October contract administration, planning, programming and 1987 by DTS, the World Bank, UNDP, UNSO and the monitoring, have been developed by the pilot project. ILO. The participants to the review recommended an These procedures were successfully introduced by the expansion of the project to cover some 300 km of roads project and have been approved by MOWC. in Eastern Division. In sum, the pilot project has demonstrated that unskilled The pilot project was set up to develop, test and labor can be engaged with no previous experience of introduce alternative labor-based road maintenance road works to carry out all routine maintenance activi- systems on selected primary, secondary and feeder road ties except small-scale resealing. Only the occasionally sections. It was anticipated that a more flexible and required inputs of gravel and premix for patching need sustainable maintenance approach could be developed to be supplied. based on the use of labor with possible savings and fewer operational constraints than the traditional The success of the pilot project has led to the develop- equipment-based system. ment of an expanded project of labor-based road main- tenance in Eastern Division. The principal objective of The pilot project has experimented with two comple- this project is to put into place a cheaper, more easily mentary labor-based systems of routine maintenance for sustainable maintenance system with a lower reliance The Gambian road network. Its purpose was to demons- on equipment and greater utilization of local resources. trate the feasibility of achieving routine maintenance This expanded project is viewed as an interim phase to using either of the labor-based systems and to furnish a nationwide application of the systems developed by productivity and cost data. This would enable an the pilot project. The project which was scheduled to assessment of the cost effectiveness of the systems and start in mid-1989 will train for this purpose adequate their possible role in the future maintenance of The numbers of supervisory, administrative and operating Gambian road network to be made. The results of the staff and establish labor-based routine maintenance pilot project would determine the maintenance strategy systems on some 370 km of primary and secondary to be adopted in the World Bank-financed Second roads, comprising 25% of the national road network. Highway Project. Geoff Edmonds: International Labour Office, Geneva, Switzerland. 131 The Gambia: Pilot Labor-based Road Maintenance Project - Case Study Pilot Project Organization The inventory was used to divide each road into sections of approximately 5-6 km in length (2-3 km The pilot project field work was organized and super- either side of each village). The beginning and end of vised in close cooperation with the Divisional Engineer each section was established on the road with a in Eastern Division. The direct field operations which permanent mark (e.g. marker posts, stakes). included the daily setting of tasks and monitoring were carried out under the supervision of a UN Volunteer Condition and Works Inspections. The purpose of these project officer. Pilot project field staff included inspections was to determine for each section of road: 2 supervisors, 1 tractor operator, 1 driver and support- ing administrative staff. The project was regularly * the annual routine maintenance requirements for guided and supported by short-term consultancy inputs each maintenance activity for planning purposes; and monitoring visits. * the condition of the road for works programming Project equipment included handtools, 1 pick-up, purposes; 1 tractor, 1 towed grader unit, 2 trailers, 2 bicycles and various miscellaneous items. A detailed tools and * the maintenance work carried out for works control equipment list is attached as Annex 1. The tools supply purposes. covered the project requirements for some maintenance workers over the pilot project period (two years). Initial full inspections were carried out on foot by the Project Officer. The Defect Inspection Forms used The project establishment phase comprised the procu- for gravel and paved roads are shown in Annex 3. rement of project equipment, the setting-up of project These inspections were carried out three times per store and office, the assignment and briefing of project year. Routine inspections were to be carried out on counterparts staff and the carrying out of a detailed roads under lengthmen and contractor maintenance by road inventory. This phase was followed by a product- a foreman on the bicycle. The foreman inspected ivity monitoring period of 10 months during which the quality of work done and determined the progress basic productivity data for each maintenance activity of works. The foreman stayed overnight in village have been established, accommodation. Following a review of these phases during which the Annex 4 provides an example of a completed daily forms of contracts and the specification for petty works report with a detailed explanation on its com- contracts were finalized, the maintenance activities were pletion. During the pilot project period, these reports extended to cover all project roads using lengthmen and were produced on a daily basis for the monitoring of petty contract methods. During this final period a towed works progress and the establishment of productivity grader team was also trained and its performance moni- norms. During the normal maintenance cycle, these tored. A pilot project work plan is attached as Annex 2. routine inspections would be carried out on a monthly basis. Data Collection and Works Control Administrative Systems and Procedures Inventory. The purpose of the road inventory was to establish the pertinent details of the sections of road to Recruitment and Dismissal. The MOWC systems of be maintained to assist later in recording data and recruitment and dismissal of labor, in use at the time planning maintenance work. of the start of the project, were very cumbersome and constrained the use of casual or contract labor. Five The following basic data were recorded in tabular form different documents were involved in the recruitment for each road to the nearest 0.1 kIn: and discharge of casual labor. Simplified forms and procedures were developed by the project which both Features satisfied MOWC requirements and which enabled the Junctions efficient recruitment and discharge of labor to more Villages (both on and close to the road) closely match the maintenance work load. Culverts and structures Ditch requirements Annex 6 contains samples of the recruitment and Existing gravel pits discharge forms subsequently agreed and used for the Surface type casual employment of labor and for the engagement of Pavement width lengthmen. The new system has worked effectively and Dates and details of periodic treatments has been recommended for adoption by the MOWC for (gravelling/resealing/overlay). all hiring of temporary labor and lengthmen. Following a reorganization of the MOWC the Divisional 132 The Gambia: Pilot Labor-based Road Maintenance Project - Case Study Engineers would have more responsibility for * At the deferred inspection date the satisfactory controlling works. The project concluded that the completion of the work would enable the Certificate Divisional Engineer should be delegated the authority of Compliance to be issued. to recruit and discharge all Daily Paid Labor, including lengthmen, in line with the reorganization's decentrali- * If the work was still deficient at this time the zation policy. extent of work not satisfactorily completed would be measured. Petty Contracts. Petty contracts procedures also were complicated and caused lengthy delays in their appli- * A Certificate of Contract Variation would be issued cation. Formal requests had to be approved by the stating the reasons and extent of the work to be Director of Technical Services and payment procedures excluded from payment. This Certificate could form were very cumbersome, necessitating the petty contrac- an alternative part of the Certificate of Compliance. tors to travel to the Ministry of Finance in the capital to collect payment checks. Payment Procedures. The main drawbacks of the payment system in force at the time of the start of the New forms and procedures were developed at the start pilot project were: of the pilot project. These were agreed with the Director of Technical Services and implemented under * the frequency with which the checking and approval the project. The project concluded that under the re- process had to be repeated and the associated costs, organization the responsibility for awarding petty administration and transport requirements; contracts up to a certain value would be invested with the Divisional Engineer. * the problems of adjusting the actual payment against the time actually worked and the difficulties The project found that petty contracts were not difficult thereby introduced for work and cost monitoring; to control where work could be easily measured, e.g., for vegetation clearing, gravel loading or unloading etc. * the need for the casual employee to travel to the However, care was required in measuring and control- arranged paying point at his own cost and inconve- ling certain activities, e.g., gravel excavation. In this nience. case, quantities were required to be controlled in trailer loads or measurable heaps. For labor-based road maintenance to be successful it is essential that payment of employees is carried out The Petty Contracts Forms were completed in three regularly at the appointed time and place and in the copies: correct amount, otherwise motivation of the workforce will suffer. * one copy for HQ and Ministry of Finance procedures In order to allow timely and regular payments the pilot * one copy for the Contractor project paid casual laborers on a monthly basis in * one copy for Project Officer's file arrears, to their exact entitlement and on a day fixed to be between seven to ten days into the following The Form of Contract included a brief standard month. Then, in order to reduce costs of transport, specification for each activity to be carried out. payment was made at villages along the roads being maintained, which was more convenient for the casual During the period of the contract one visit was made by employees. This arrangement significantly reduced the the foreman or Project Officer to check on progress of amount of administration work and the amount of the contract if necessary warning the petty contractor of travelling. All due payments for days worked and deficiencies or delay and the consequences. On the overtime could be finalized before payment processing. appointed date the Project Officer inspected the work compliance with the contract. The existing payment provisions for Petty Contractors were totally unsatisfactory. Considerable time and * On satisfactory completion of the work a Certificate expense tended to be wasted in the contractor travelling of Compliance was made out in duplicate and to Banjul to receive payment. For this reason arrange- issued to the Petty Contractor. ments were made so that the payment checks were for- warded to divisional level for payment in cash by the * If the work had not been satisfactorily completed a Project Officer, the Divisional Engineer or an approved Notice of Non-Compliance was given to the Petty Paying Officer in the village of the Petty Contractor. Contractor stating the reasons for unacceptability. A further inspection date was then stipulated on the It was ensured that the Petty Contractors were paid notice. correctly and promptly within a reasonable time 133 The Gambia: Pilot Labor-based Road Maintenance Project - Case Study (two weeks) of the certification of satisfactory of the ground was immaterial-the level of differential completion of work. was the important feature. Material was then reshaped by hand from the gravel surface until the height of peg Work Methods. A number of techniques were developed above the road surface at center line and channel were for controlling the quality of work achieved. For equal. Light compaction by hand ramming was adopted. reshaping the gravel carriageway by hand, wooden pegs Over a period of time the traffic further consolidated were placed at 3 meters either side of the center line the gravel. Any irregularities in the surface could be to define the road edge. The pegs were fixed by camber removed later by only two passes of the tractor towed board and spirit level so that the tops of the center line grader. Similar full reshaping of carriageway using pegs indicated a 4% cross fall to the tops of the equipment only would have required six to eight passes carriageway edge pegs. The amount of peg sticking out of a towed or motor grader. Table 1: LABOR-BASED PILOT PROJECT PRODUCTIVITY MONITORING RESULTS Activity Average Productivity Task Work Productivity Code Unit Day Work Task Work Improvement Gravel/Paved Roads 10/20 Cleared vegetation m2/HR 54 71 31 11/21 Cleaning culvert Drainage NO/HR 0.21* 0.25* 19 12 Gravel patching m3/HR 0.25 0.31 24 13/23 Miscellaneous 14 Gravel patching (spot regravelling) m3/HR 0.51* 0.58 14 15 Ditch clearing 15A Ditch result M/HR 6.8 15B Ditch excavate M/HR 1.42 3.36 137 16 Light grading 19 Reshape by hand m2/HR 5.3 9.2 74 Paved Roads 22 Premix patching m3/HR 0.06 24 Patching shoulders m/HR 0.17 0.37 118 25 Regravelling shoulders m/HR 0.33 0.60 82 29 Small surface resealing 32 Shoulder reshape by hand M/HR 10.6 12.0 13 Miscellaneous 100C Exe + stockpiling m3/HR 0.20 0.31 55 100D Loading gravel m3/HR 0.53 0.87 64 100E Unloading gravel m/HR 1.06 1.62 53 201 Premix manufacture m3/HR 0.19* * 6 M width gravel pavement 134 The Gambia: Pilot Labor-based Road Maintenance Project - Case Study Table 2: ROAD MAINTENANCE ACTIVITIES RECOMMENDED TASK WORK RATES Category Activity Code Task Rate per manday Gravel/Paved Roads Clearing vegetation 10/20 420m Clearing culverts incl. Inlets + outlets 11/21 1-2 NO Gravel patching (manual) 12 1.8 m' Miscellaneous 13/23 patching (spot regravel) 14 3.5m Ditch desilt 15A 50 LIN.M Ditch excavate 15B 20 LIN.M Light grading (tractor) 16 Reshape by hand 19 10 LIN.M Paved Patching shoulders 24 2.2 n2 Regravel shoulders 25 3.5 n3 Small surface reseal 29 Shoulder reshape (hand) 32 70 LIN.M Miscellaneous Quarry prep (vegetation) 100A 250m2 Quarry prep (overburden) 100B 2.5 n3 Exc + stockpiling gravel 100C 1.8 n3 Loading gravel 100D 5.0 n3 Unloading gravel 100E 10.0 M3 Aggregate transport 203 It was found to be essential to control the excavation full length of the project roads. However, it has proven and desilting of ditches by a template. Without this feasible to reshape sections of road using eight passes daily control the quantity and quality of work suffers of the towed grader. The machine was able to take off significantly.The towed grader was found to be comple- four to five cms of material at one pass and redistribute tely satisfactory for light grading and corrugation it removal; two passes-one each side-were normally sufficient to achieve this. However most of the pilot Bitumen patching premix material was prepared using project roads had not been previously regraded for labor to mix by hand. It was also prepared at various some years and had acquired an inverse camber. The points on the road network where a concrete base had major reshaping required has not been done over the previously been prepared to facilitate mixing. Screening 135 The Gambia: Pilot Labor-based Road Maintenance Project - Case Study laterite gravel was used due to the absence of cockle village laborers who are willing to work hard for a shell aggregate. The bitumen cut back (SC800) was supplement to their subsistence income and on a heated by firewood in a half barrel and applied to the payment by results basis. correct amount of aggregate (measured by wheel- barrows). The materials were mixed using long-handled MOWC in The Gambia has now decided to take the spades frequently heated in the fire to facilitate mixing. groundwork of the labor-based pilot project and over a The material was supplied to the lengthmen who clean- timescale of say five to six years, work towards an ed out the potholes, filled and compacted the material integrated road maintenance system that: with hand rammers to repair the road surface. The slow curing cut back allowed up to three days for placing the * makes maximum use of labor-based lengthmen and material before unacceptable stiffening. petty contracts as opposed to force account for routine maintenance work; Pilot Project Results * minimizes reliance on transport and sophisticated The detailed productivity monitoring of the different equipment. labor-based maintenance systems was carried out on a total of 63 km of bitumen and gravel road. The range of routine and periodic maintenance activities required to be carried out by the MOWC are detailed in Lengthmen operations were established on 44 km of Table 3. The methods for implementing each activity bitumen and gravel road and carried out Petty Contracts under the proposed medium-term strategy are listed. on a further 19 km of gravel roads. It was demonstrated Basically it is recommended that nearly all routine that unskilled labor can be engaged with no previous maintenance activities are carried out by lengthmen or experience of road works to carry out all routine petty contracts supervised by foreman on motorcycles. maintenance activities except small-scale resealing. Payments will be made either on the specific roads or Only the occasionally required inputs of gravel and at certain population centers/road depots. This strategy premix for patching need to be supplied. would significantly reduce the requirement for tipper trucks and only slightly increase the demand for Productivity data was assembled for work carried out supervision vehicles for payment duties. under "daywork" and "taskwork" conditions. For the daywork situation the labor outputs for a fixed eight- A much smaller direct labor or force account core hour day were measured. Using this data tasks were set would be retained at the Divisional Engineers HQJMain based on the eight-hour quantities. The time to Depots with arrangements for them to be temporarily complete the task was then measured. The equivalent accommodated at other sub-depots within the division hourly productivities were determined and averaged for as necessary (by the payment of appropriate each activity. allowances). The task work recommendations have been used to These one or two gangs per division would be equipped derive proposed petty contract rates. Details on the with a tipper truck, be deployed anywhere in the method of price determination and rates proposed for division and be responsible only for: each routine maintenance activity are contained in Annex 8. Page 2 of this annex also details the rates emergency works already accepted under the Pilot Project for Petty * patching of bitumen roads Contracts. premix manufacture for patching * small-scale resealing Conclusions pavement reconstruction * pavement regulation It is becoming increasingly evident that major problems are being experienced in implementing road mainte- Should be carried out by centrally controlled (MOWC nance by equipment-based force account methods, parti- HQ/DE) equipment-based teams deployed as necessary cularly in more remote rural areas. on the road network with adequate servicing and repair back-up. Motivation could be similarly improved by the Availability rates for equipment and transport are use of productivity related allowances. extremely low and this negatively affects the perfor- mance of permanent maintenance workers. It appears to In the long term, serious efforts should be made to be fundamentally unsound to transport difficult-to- encourage a local contracting capability to carry out motivate-and-control unskilled labor, with equipment some of this periodic maintenance work with sufficient expected to be available less than 50% of the time, with numbers of contractors to avoid monopolistic situations. transport cost and travelling time penalties, to work on Hauling, patching, and regravelling would be most a section of road where there are equally competent suitable to this approach. 136 The Gambia: Pilot Labor-based Road Maintenance Project - Case Study Table 3: ROAD MAINTENANCE IMPLEMENTATION PROPOSED MEDIUM TERM STRATEGY Code Maintenance Activity Proposed Method Gravel Roads 10 Clearing vegetation Lengthmen/Petty Contract 11 Clearing Culvert Drainage 12 Gravel Patching (manual) 13 Miscellaneous (Emergency Work) D E Mobile Gang 14 Gravel Patching (Spot regravelling) Lengthmen/Petty Contract 15 Ditch Cleaning 15A Ditch Pesilt 15B Ditch hxcavate 16 Light Gialing (2-4 passes) Towed grader team 17/19 Reshaping Roadway Lengthmen/Petty Contract 18 General regravelling Paved Roads 20 Clearing vegetation Lengthmen/Petty Contract 21 Clearing culvert drainage " 22 Patching premix D E Mobile gang 23 Miscellaneous (emergency work) " 24 Patching shoulders (manual) Lengthmen/Petty Contract 25 Regravelling shoulders " 26 Pavement repairs Mobile bitumen team 27 Mowing Delete 28 Regulating pavement (premix) Mobile bitumen team 29 Small surface resealing D E mobile gang 30 General resealing Mobile bitumen team 31 Fog seal " 32 Shoulder reshaping by hand Lengthmen/Petty Contract Miscellaneous 100 Stockpiling gravel 200 100A Quarry preparation: vegetation clearing *Lengthmen/Petty Contract 100B Quarry preparation: overburden removal 100C Excavation and stockpiling gravel 100D Loading gravel 100E Unloading gravel 201 Premix manufacture D & E mobile 202 Cockle shell agg.proc. Contract 203 Aggregate transport Regravelling team/contract * Equipment-based for periodic maintenance work 137 Topic B: Case Study Ghana: Feeder Roads Project Introduction The two main field components of the project were based at: A substantial component of the World Bank's Fourth Highway Project in Ghana concerned the rehabilitation Sefwi Wiawso - rehabilitation by contract and maintenance of feeder roads. In light of Kumasi - spot improvement and maintenance accumulated experience elsewhere and the known (SIAM) (to cover the Sefwi Wiawso, employment situation, a labor-based approach was Goaso and Bekwai Districts). proposed. The private sector was to be involved in preference to the more traditional direct labor (force At each place, a Technical Adviser was based and, at account) approach to rehabilitation. Sefwi Wiawso, a Training Adviser was responsible for the contractors training program. Local counterpart staff For the development of maintenance strategies, the were appointed from within DFR, which also provided project aimed to mobilize local communities adjacent to all other necessary support staff for the field activities. the roads based on the tradition of free community labor for local development projects. Where possible, The Chief Technical Adviser was based at the DFR the communities were also to undertake "Spot Improve- Head Office. His terms of reference were to assist in ments" to render local roads accessible where the the establishment of the capacity of the DFR to plan, rehabilitation program was not reaching. monitor and control labor-based feeder road improvement and maintenance programs. The government organization responsible for the project was the Department of Feeder Roads (DFR) within the Ministry of Roads and Highways (MRH). To provide Establishment of the Program the Technical Assistance required for the specialized nature of the project, the 1JNDP agreed to fund a Before the arrival of the Technical Assistance team, a number of Technical Advisers, based both at the DFR number of preparatory activities were undertaken by the head Office and the chosen project areas. The DFR staff. The principal ones were: Government of Ghana was to provide the local costs and the initial funding breakdown was as follows: initiation of procurement of construction equipment, tools, office equipment supplies and vehicles. World Bank (IDA) US$4.64 million UNDP US$0.98 million initiation of the building of the necessary infra- Government of Ghana US$1.55 million structure (accommodation, classroom and training facilities, workshop and stores, offices) at Sefwi A number of preparatory missions were carried out by Wiawso). officials and consultants representing the World Bank and the International Labor Organization (ILO), the inventory of all feeder roads in three project chosen executing agency for UNDP. The ILO has been districts. extensively involved in the development of the labor- intensive technology in the construction field. As a socio-agricultural analysis of the areas of influence result of these studies, the project was based in the of the roads. Western, Brong Ahafo and Ashanti Regions, which are the main cocoa producing areas of the country. In these * priority ranking of the roads for the initial roads regions, the steady deterioration of the feeder roads has rehabilitation programs over a three year period. led to severe problems in the evacuation of cocoa for export. One district in each of the three regions was In addition, the ILO organized during this preparatory chosen to form a contiguous geographical area (Sefwi period study tours for the designated Project Engineers Wiawso, Goaso, and Bekwai). to countries where successful labor-based programs . This case study was prepared by the International Labour Organization (ILO). 138 Ghana: Feeder Roads Project - Case Study were operational (Botswana, Ethiopia, Kenya, and * creditworthiness; and Malawi). * ability and willingness to provide and pay for The procurement of appropriate tools and equipment supervisory staff to be trained by the project. was based on a project analysis by the ILO. The requirements were incorporated into the World Bank Program Implementation: Staff Appraisal Report for the Fourth Highway Project Contracts Components in May 1985. A selection exercise was carried out to choose an The procurement procedures followed World Bank agreed eight fins for the initial training program. An Guidelines for both International Competitive Bidding initial four sets of equipment' had been included under and International Shopping, and were directed by a the project funding. The intention was to identify the Project Management Unit which had been established four best companies after training to continue with the for the Fourth Highway Project. DFR provided a contract work. The initial selection of eight firms was counterpart engineer to gain experience in the done by assessment of a completed questionnaire which procedures. Two ICB documents were produced, one provided both technical and financial information. The through Ghana Bank for Housing and Construction technical assessment was carried out by DFR and the (BHC) for the equipment intended for the contractors financial clearance was given by BHC. Small compa- (paragraph 3.1), one through DFR for use on the SIAM nies, locally based and with a previous record of component where the Department was to retain owner- satisfactory work for the DFR were sought. ship. The cost per set of equipment was approximately Young engineers of the DFR, including two designated US$150,000. The second purchase order replaced the Project Engineers for the Contracts and SIAM compo- tipper truck by a pick-up type vehicle. nents, carried out the roads inventories over a period of several months. The existing road lengths, drainage The field work started with a detailed training program structures and other engineering features were recorded covering a 23-week period. The initial theoretical together with social amenity data such as schools, (classroom) training was kept to a minimum. The main clinics, markets, etc. emphasis was on practical experience through rehabilitation of a 10 km road close to the project field The newly established DFR Planning Unit, headed by offices as a model training site. a Planner from the University of Kumasi (UST) compi- led data on village population agricultural activity, Each contractor was required to send four trainees social amenity, and specifically, cocoa production in the (engineers or technical supervisors) and to provide all project areas. From this data, a priority ranking system costs in connection with the training. Once trainees was produced using weighted parameters. were working on the model road they were paid at the appropriate rate for the job to relieve the contractor of Towards the end of the preparatory period, in April part of his financial responsibility. 1986, ILO representatives ran a number of seminars to introduce the project The seminars were held in Accra Together with the contractors' trainees, the DFR provi- and in four towns in the project areas, Takoradi, Sefwi ded an equal number of engineers and foremen (some Wiawso, Goaso and Bekwai. The participants included from the SIAM component) for training. These would both local administration representatives and the local later be deployed in supervision roles on contracts or contractors who were being encouraged to join the for the organization and management of the SIAM program. At this time, an assessment of these contrac- program. Training was directed by the ILO Training tors was carried out in order to define the training Adviser. needs of the companies. Subsequently, an outline training program for contractors and government staff The training program and model road were completed was produced. on schedule during a period of four months. As a second stage of the training program, the four best Following the explanatory seminars, the contractors performing firms were awarded 5 km sections of road were invited to express their interest in joining the as Trial Contracts for DFR to assess their individual project, initially in Sefwi Wiawso. Twenty-one firms capability. During this period, project staff acted in applied and a selection procedure was carried out with both a supervisory and advisory capacity. The contract the following as principal criteria: periods were four months with contractors-each using one set of equipment which they would take over at a relevant previous experience; later stage. 139 Ghana: Feeder Roads Project - Case Study Equipment Arrangements of the each month. Advance payments for labor were made at the end of each month, based on returns sub- As noted (paragraph 2.2), the procurement of the equip- mitted by the contractor, before the monthly measure- ment for the use of the contractors was undertaken by ment of work was undertaken. These advances were the BHC, with the objective of the Bank entering into then deducted from the normal interim certificate hire purchase agreements with the chosen contractors payments. Supervision staff monitored the payment of for repayment over a four year period. The loans were the laborers in the initial stages. evaluated in dollar terms at a fixed interest rate of 20%. Monthly repayments were due in local currency at the prevailing exchange rate, which was floating. Project Extension Before committing untrained contractors to these loans, Based on the initial results of the training phase and the the DFR agreed to lease the plant during the model obvious competence and commitment of the contractors, road and trial contract periods (total eight months). For the Government and the World Bank decided to expand the model road, the Government bore the costs and for the Goverm the orl Bank c ded to expan the trial contracts, equipment costs were deducted from the project from the orginal four contractors to nine- the contractor payment certificates. Appendix 1 shows teen. This involved the organization of two more tram- the charges made to the contractors during this period. ing courses each with staff from six firns and selected engineers and supervisors from DFR. Each course train- The BHC conducted its own assessment of each con- ed some fifty staff. The new firms were chosen from tractor's financial credibility before entering into the the Brong Ahafo and Ashanti Regions in order to be loan agreements. On satisfactory completion of the trial able to expand the project areas. Eventually for the theloan agreements.O wetor etsigne d thl second course, two extra contractors from the Eastern contracts, han ove t e ntractors.e Region were added for a proposed project in that area. equipment handed over to the contractors. The total number of firms trained by mid-1989 would, therefore, be twenty-one. Contract Procedure The normal procedure for DFR at the start of the Costs project was to award contracts to selected contractors The cost of rehabilitation works by contracts using this using the Department's standard unit rates and Tecs frhbltto ok ycnrcsuigti including a variation of price clause. These rates were technology were running about 20% cheaper in finan- based on capital-intensive technology and related to the cial terms than the equivalent capital-intensive work use of heavy earth moving equipment. being done for DFR. In addition, the foreign exchange component is now reduced by about 50% from around During the construction of the model road, the project 60% to around 30%. At 5 m, graveled width (10 cm staff analyzed the productivities and costs for the compacted), with full length longitudinal drains and various work items as carried out by a labor-based with new culverts at 1.6 no/kmn the budget cost of methodology and calculated appropriate unit rates. On rehabilitation is now put at US$10,000 per km. It is of the assumption that productivities obtained on the interest to note that these costs are lower in US Dollar moel rssuo wthit proghlyicnentaed upervision terms than initially calculated. The reduction in dollar would not be reached under normal contract conditions costs was mainly due to the devaluation of the Cedi suitable adjustments were made to the rates to be against the dollar which made equipment more expen- sutapledjrtetl corct mande s e e te sive and labor less expensive in dollar terms. applieA for the trial contracts and subsequently, the full contracts. Appendix 2, prepared by DFR project Appendix 4 shows the achievements of the contract engineer shows the unit rates used by the project. component as of August 31, 1988, in terms of length completed and costs. Full contracts of 25 km were then awarded to each contractor for completion in one year. For these Work Load contracts, the standard conditions of contract used for roadworks in Ghana were applied, but for the labor- In order to retain the interest of the contractors and to based contracts a number of special conditions were ensure the ability to repay the equipment loans, a added specifying the plant and working methods to be consistent work load has been ensured for the used. Appendix 3 shows these additional clauses. immediate future. Under the World-Bank financed Cocoa Rehabilitation Project, 3,000 km of feeder roads In addition, a payment system was introduced to try and have been earmarked for the labor-based program. This ensure that labor was paid fully and promptly at the end proportion will be increased, if necessary. 140 Ghana: Feeder Roads Project - Case Study Project Implementation: Spot Improve- substantially completed suffered considerable problems ment and Maintenance Program (SIAM) with mobilization and local politics. Continuous liaison was maintained with the local administration at district Introduction and village levels and with all the traditional mobili- zation authorities, but with no consistent success. The emphasis of the Spot Improvement Maintenance Program was to involve local communities in the improvement and maintenance of their own feeder Future Strategy roads. The objective of the spot improvement work was to render roads at least passable most of the year by the In order to program the work and allocate resources improvement (usually to the drainage) of those spots effectively, consistent work force and good productivity preventing access. The installation or repair of culverts, were required. By the very nature of free labor, neither the raising of low areas and the rehabilitation of steep could be guaranteed for a long period and progress was sections were the main elements. Strategies were then slow. Following this experience, it was decided to scale to be evolved for the routine, recurrent and periodic down the size of future spot improvement operations maintenance using communities and DFR force account and not to involve the communities for longer than a labor as appropriate. two month consecutive period. In this manner, spot improvement by a free community labor was still consi- A thorough inventory carried out by the project staff dered a viable operation since several communities revealed that very few roads were in a maintainable made specific requests to project staff to be included in state and that the spots to be improved were far more the program. numerous than envisaged with about three times more culverts than programmed. Maintenance Being a new concept, the idea had to be explained and "sold" to the local administrations and communities. In Routine maintenance can only be carried out on roads the areas chosen for the start of the operations, much that are maintainable-meaning that they do not require time was spent at the village level holding explanatory improvement or rehabilitation to bring them to an meetings and discussing the strategy for mobilizing the acceptable standard. Such roads were rare within the necessary free labor. Whereas the tradition is for the project areas. Eventually, the program established communities to give its labor freely on one day in the routine maintenance on: week, the essence of this program was to try to spread that large labor force over the five-day period into more * roads rehabilitated under the contract component; manageable u. roads improved under spot improvement; At the same time, the idea of providing some incentives to individuals and/or the communities to encourage the * roads rehabilitated under the DRR capital intensive free labor input was explored with the World Food program; and Program (WFP), which was already involved in food aid distribution within the entire DFR organization. * roads reshaped under SIAM recurrent maintenance. Food aid inputs to SIAM eventually commenced in September 1988. The project evolved a strategy of establishing road maintenance committees at district, zone and village levels to be responsible for routine maintenance of Spot Improvements feeder roads, with DFR providing necessary tools and technical supervision. This fitted in well with the Short spur roads were chosen in each of the three Government policy of decentralization, which had led project districts as model spot improvement sites. Spot to the election of local district assemblies in the 110 improvement work was carried out during the period of political districts in the country. This shift to local June to August 1987. The response from the villages responsibility away from central government facilitates varied considerably after the initial promises of full considerably the practical organization of involvement cooperation. in road maintenance. Initial results obtained with this system are encouraging. Two out of the three roads (Bekwai and Goaso) were eventually completed successfully with the standard of Recurrent maintenance remains with the DFR labor work being good. However, it was clear that the work force and consists of two elements: input required had been too high to be able to sustain the enthusiasm and commitment of the workers over the light grading and reshaping using the towed graders; long period. The third road (Bibiani), although and 141 Ghana: Feeder Roads Project - Case Study mobile culvert maintenance gang. mainly "civil" project should be thoroughly addressed. The small amount of backup equipment for hauling, Two types of towed graders are being 'used on the compaction and supervision is absolutely essential, and project, the mechanical and hydraulic models, which are measures should be taken to ensure a reasonable being compared in performance. availability of these items. The culvert gang consists of a foreman, artisan, and Particular attention should be given to the less laborers based on the tipper truck which carries a tent, "glamorous" project components such as routine main- materials, and tools sufficient for one week's tenance organization. Project components such as SIAM operations. Desilting, inlet/outlet, clearing and ditching are more difficult to establish because results in are carried out by the laborers while the artisan organizing and mobilizing community workers are completes headwall, wingwall, and apron repairs. much harder to achieve and less visible. The periodic maintenance of regraveling is let out on Government departments, such as DFR, are generally contract to those contractors trained under the labor- overworked and understaffed in normal circumstances intensive program. This will be another element in the with a significant gap at middle management level. A future work load for those contractors. newly-funded project not only adds to the general work load but imposes new management and administrative requirements which staff have to assimilate. It would be Lessons Learned advantageous to initially establish a separate unit within the Department for such a project. If this is done, care The ability of small contractors to efficiently apply should be taken that such a unit offers adequate career labor-based road rehabilitation methods has generally possibilities to senior and middle level staff. If this is exceeded expectations. Small firms, initially lacking not the case, attachment to such a unit would quickly technical expertise and resources have wholeheartedly be perceived as a punishment rather than as an embraced the technology. Clearly, they see in it a enhancement of a personal career. steady future work load with proven profitability, taking into account overhead and loan repayment obligations. Technical assistance is often confined to senior levels only. On this Project, the value of U.N. Volunteers at Productivity is constrained by a shortage of trained the field implementation level has been proven and an supervisors, a minimum of five per contractor is needed extension of this to the SIAM component has been if the optimum labor force of 200-220 is to be recommended to help the young DFR engineers day-to- employed. One or two contractors are falling below the day involvement with the communities. target of 2 km per month on the full contract with a labor force of 160-180. Once fully equipped, the 19 The enthusiasm of most communities to provide access trained firms have a capacity to produce over 450 km on what they perceive to be "their own roads" (i.e., of high quality gravel roads per year. single short spurs) is clearly evident. Turning that enthusiasm into effective practical action and long term The long training and trial periods are necessary to sustainability is difficult where the labor is to be prove the competence and commitment of the contrac- totally free and some form of incentive scheme should tors. There was an initial concern that contractors only be considered. The community-based approach to saw the project as an opportunity to get some equip- routine maintenance needs to be very flexible with no ment after which they would disappear. This fear was system "imposed." This is where the village totally unfounded. Applications from other contractors maintenance committees have an important role to play. to join the program have exceeded fifty. There are a number of small contractors headed by a qualified The rapid expansion of the program has a number of (degreed) engineer. These are, not surprisingly, among important implications in terms of funding and the best performers and account is taken of this in the management. The DFR management capacity in selection procedure. contracts administration, planning, accounting, procurement and mechanical support has to be streng- The involvement of other agencies in aspects of the thened proportionally with the program expansion. project (e.g., BHC for procurement and loan agree- Systems for inputs deliveries (financial and material) ments) has a serious delaying effect. For them, the and management information are essential. In terms of project naturally does not have the same priority as for cash flow, the large-scale application of labor-based DFR. In general, procurement is very time consuming. contracts creates growing financial obligations which It should be given full-time attention well in advance of may cause considerable problems unless timely measu- project implementation. Specialist inputs for procure- res are taken. The establishment of a sufficiently ment should be part of the project. substantial revolving fund covering two months of project operation is a prerequisite for the continued The question of mechanical backup in an otherwise success of this program. 142 Topic B: Case Study Kenya: The Development of the Rural Access Roads Program* In 1974, the Kenyan Ministry of Works initiated a program would have spent only 10-15% in local costs. program of feeder road improvements. The program This therefore represented a foreign exchange savings was directed at farm to market roads and the intention of 40-45% for every dollar expended. was to provide a stimulus to agricultural production. It was designed to cover the populated areas of Kenya. Its Secondly, it provided the model for the replication of original target was 14,000 kms over ten years, although labor based projects elsewhere in Africa and Asia. this was subsequently reduced to 8,000 kms in light of the decline of the economy. Finally, it illustrated the possibility of effective donor coordination. In its objectives and scope, the program was no diffe- rent from a whole variety of others that were imple- Since its inception, the program has attracted a great mented in Africa during the 1970s. They reflected the deal of financial and technical support. The latter has belief in the catalytic nature of rural roads and the been provided in the belief that this kind of program concern to increase agricultural production. Never- would be implemented elsewhere and that the RARP theless, this program-the rural Access Roads Program- could serve as a model of implementation. That this has was different in one fundamental aspect. It was indeed been the case is illustrated by the enormous designed to be implemented by labor-based methods. interest that the program has generated during its implementation, In 1988, pilot projects or programs This could have been surprising enough in a country based on the concepts developed for the RARP were with some previous experience of these techniques. In being implemented in thirteen African and six Asian a country which was not lacking in donors ready to countries. support programs and with little knowledge of the use of the methods, it was a major political and phioso- In the RARP, the development of local resources was phical commitment. emphasized. There was a high involvement of local personnel. The training of the supervisory personnel That this commitment was justified is shown by the fact was specifically related to the management of large that ten years later, the program had: numbers of workers. * constructed some 7,800 km of gravel road at an Furthermore, new planning, programming and organiza- average cost of some US$6,000 per km; tional procedures have been developed. Research was carried out on tools and equipment to improve their * created temporary employment for over 14,000 quality. people per year; Decentralization of planning was realized by delegating * created permanent employment for another 4,000; the responsibilities of the initial screening and selection and of the access roads in their respective areas to "District Development Committees."' Consequently, the rural * produced roads of an acceptable and satisfactory communities at the grass-roots level have been involved quality. in the identification of the roads to be constructed. The selection of these roads was done in accordance with At its peak, the program was producing over 1,200 kns guidelines established by the Roads Department of the per year in 42 districts throughout Kenya. Ministry of Works. While the program was a success in producing good What were the major factors that contributed to this quality roads at a reasonable price, it also had other successful program? indirect benefits. Government Commitment. At the time of the start of Firstly, between 55-60% of the total cost was in local the program, the Kenyan economy was just beginning currency, much of this in wages, which was investment to suffer the effects of the oil crisis. Nevertheless, in the rural areas. A similar equipment intensive foreign exchange was still available, and rural under- This case study was prepared by the International Labour Organization (RLO). 143 Kenya: The Development of the Rural Access Roads Program - Case Study development and rural-urban migration were not seen as * a planning and reporting system which permitted major development issues. It took a far-sighted govern- effective monitoring of the program; and ment, therefore, to see the potential benefits of a program which relied on local resources and created construction procedures adapted to use of labor employment in the rural areas. Moreover, the proposed based methods. program was not one that would automatically appeal to the implementing agency. From the beginning, The value of the planning or technology unit cannot however, the government was prepared to put its own be underestimated. Introducing a new technology auto- funds into such a program. On average, about one- matically presents problems of adaptation. Equally, fourth of the total RARP budget of US$50 million has program management rarely has the time to devote to been provided by the government anything else but implementation. The capacity which such a unit offers to analyze and propose solutions is Training. Even before the program was initiated in particularly useful. the field, training programs had been set up for the supervisory staff. Correctly, the MOW had judged that Donor Support/Coordination. From the start, the the effective supervision of the labor force would be the critical element of a labor based program. A specialist prod thb Ron donori support oe te ten-ye training unit was set up and over the life of the project, rent donors.' This, of course, has been very welcome a total of some 300 supervisors have been trained. and has permitted the RARP to grow to such an extent. The training program had several critical elements: On the other hand, each donor had different objectives and procedures. If the MOW had to deal with all ten it was set up early enough to ensure that efficient donors separately, service ten different review missions, *staf wsreaupiearly athenugh t ue tand provide information to ten donors separately, staff were available at the right time; the MOW would scarcely have had time to run the * it was institutionalized within the MOW; and program. it conducted a series of refresher courses to ensure Early in the life of the program it was believed that it would be much more sensible to have a coordinated donor group which, to the extent possible, would pro- The training center has been used as a regional vide a common approach to the program. The donor center in that many other countries have sent trainees to group met once or twice a year with the Ministry to the center, share problems and to discuss the future of the program. Such donor coordination, which it should be Systems and Procedures. There was a recognition said is relatively rare, had specific advantages: from the start that a smooth change of technology to . it reduced the time spent by MOW officials dealing labor based methods would require modifications to with donors; existing systems and procedures. This applied both to the technical aspects of design, appropriate tools and * it provided a common approach by the donors to the equipment and construction procedures as well as the administrative aspects such as procurement, recruitment program; and payment. The MOW established a technology unit * it limited the more eccentric demands that donors whose job it was to advise the Ministry on the effective placed on the Ministry; and implementation procedures it needed to adopt. * it ensured that "a problem shared was a problem Among the variety of aspects the unit tackled, the halved", ("or tenthed"). following is a small sample: * a system of payment ensuring that workers were District-Level Selection. Linked with the political paid on time at the site; support was the manner in which roads were selected for improvement. This was carried out not at the head- * a procurement system which ensured that good quarters in Nairobi, but at the district level by the local quality hand tools were obtained; council. Clearly, no system is without some possibilities for patronage or nepotism. Nevertheless, the selection * Definition of specifications for tools and simple procedure adopted was such that the local people had equipment; the impression that the roads were not imposed from 144 Kenya: The Development of the Rural Access Roads Program - Case Study the center, but came from a local selection process. The of lengthen maintenance which utilized laborers who process also involved a consideration of whether suffi- had worked on the road for the maintenance. In this cient people were available and willing to work on the case, the laborers had more affinity with the road and, particular road. while there have been certain modifications that needed to be made, the effect has been generally good. In Maintenance. It is little use improving roads if they addition, the system has provided employment on a full cannot be maintained. The RARP developed a system time basis to over 4,000 workers. Endnotes: 1. A set of equipment consisted of the following items: - 1 tipper truck - 1 water tanker - 3 tractors - 1 water pump - 6 non-tipping trailers - 1 chain saw - 2 pedestrian vibrating rollers - I set of handtools 2. A District Development Committee comprises representatives of the various ministries, the local government and members of parliament. 3. World Bank, British, USAID, UNDP, SIDA, DANIDA, NORAD, CIDA, EEC, and the Dutch. 145 Topic B: Case Study Kenya: Rural Road Maintenance* This case study relates to the system developed for the with a typical foreign exchange component of labor-based Rural Access Roads and Minor Roads equipment based routine maintenance systems of 50%. Programs in Kenya. The study draws heavily on reports produced by the Ministry of Public Works in Kenya. The system also enables maintenance to be achieved throughout the year on each section of road. Background The lengthmen system also creates productive paid employment in rural areas where there are few opportu- The Kenyan Ministry of Public Works (MOPW) initia- nities for such work. The contractor is able to live at ted the Rural Access Roads Program (RARP) in home with his family, and the part-time terms give him October 1974. By the end of 1986, approximately the opportunity to work on his own land as well. The 8,000 lkn of rural access roads had been completed and ongoing program, the Minor Roads Program, presently the majority of them graveled and brought under employs 5,500 people on routine maintenance. maintenance. Unfortunately, the establishment of the maintenance Consideration was given to various ways of maintaining system did not attract the same amount of research and the completed rural access roads and a "'lengthman- development effort as the construction aspects of the contractor" system was chosen because it was labor RARP had done. It was assumed that the local adminis- based and the most appropriate. The alternatives tration and people would bring pressure on the considered included the traditional MOPW equipment contractors to maintain "their" roads at a good standard, based practice, and the possibility of recruiting a group however, this assumption was incorrect. The needs for of casual laborers two or three times a year to carry out training and supervision were underestimated with the the maintenance under the direction of an overseer contractor's appreciation of the maintenance require- equipped with a vehicle, caravan and mobile store. ments being rather taken for granted. The consequences However, the costs, logistics and management problems of mechanical problems associated with the supervision of these alternatives weighed against their adoption. vehicles had an adverse effect. In the lengthman system, an ex-construction worker was It is now realized that the development of effective contracted for a section of road, typically 1.5-2.0 km in maintenance systems requires as much, if not more, length. He was provided with hand tools and supervised effort than construction. once a month by an overseer to monitor the condition of the road and to authorize payments for satisfactory The problems of this maintenance system are: work. The payment was based on the contractor carry- ing out twelve days of work per month on days of his it is easy to underestimate the level of supervision selection. The contractor could be replaced if he consis- required; tently performed badly. the assumption that peer group pressure will be The contractor would live adjacent to the road and brought to bear on the contractor is generally would, therefore, not require government accommoda- incorrect; tion or transport as these consume considerable resources in a traditional equipment based maintenance supervision requires mechanized vehicles which system. need proper maintenance and repair; and A principal attraction of the system is the comparatively it is necessary to define a series of maintenance low level of equipment requirement and consequently, tasks related to the time of year, rainfall, soil type fewer support problems. This is coupled with a low and level of traffic. foreign exchange component of the system which in 1982, was estimated to be only 10%. This compares In addition, it was necessary to determine maintenance This case study was prepared by the International Labour Organization (ILO). 146 Kenya: Rural Road Maintenance - Case Study resources requirements and systems for their develop- vention, especially in the early and middle life of the ment, direction and control. Arrangements for dealing pavement. Their maintenance requirements can be with urgent works such as washouts and culvert identified and planned years ahead with modem survey breakages needed to be formulated. The methods of and management techniques. A further feature of identifying spot regraveling and full regraveling needs bitumen roads is that for a given section of road, the required to be developed and the various options for maintenance requirement is substantial and needs to be carrying out this work, e.g., by animal drawn haulage, implemented quickly for minimum traffic disruption casual labor or small-scale contractors, needed to be and maximum safety considerations as compared to investigated. There was a need to ease the supervisory feeder roads or Low-Cost/High-Maintenance roads. burden of the maintenance overseers in relation to the time that they could allocate to each contractor and the The whole approach to the planning and organization of mechanical problems of their vehicles. The scope for maintenance of feeder roads, therefore, needs to recog- the use of headmen needed to be developed as did the nize these essential differences. methods of training, directing and monitoring them. The policy of adopting the lengthmen system attempts On the technical side there was the aspect of maintain- to tackle the fundamentally different requirements of ing a satisfactory longitudinal profile, especially for the feeder, as against bitumen roads. minor roads. There was also the question of safety for lengthmen working on the carriageway of the more The aim of the system is to provide a constant main- heavily trafficked roads. Consideration needed to be tenance presence on the road able to react to the given to the use of simple tractor drawn mechanical priorities of routine maintenance as they arise. graders or drags for maintaining the running surface in these circumstances, with pothole patching support and The lengthman approach compares well to the tradi- all off-carriageway work being done by the lengthmen. tional equipment-based system in terms of physical output, a motor grader may produce a slightly higher A more equitable and effective system of recruitment, standard of running surface immediately after grading control, censure and replacement of contractors needed the road, however, the surface deteriorates at an to be developed. increasing rate until the following grading-which is often not achieved until twelve months later-when the road has reached a very poor condition. It usually Maintenance Strategy necessitates heavy grading to rehabilitate the surface. This means that average condition of the road under the The system presently operational in Kenya is based on lengthman system can be considerably higher with the following strategy. attendant vehicle cost benefits. The main objectives of maintenance of rural access From the discussion above, it follows that a mainte- (i.e., unclassified) roads and minor (i.e., ADT less than nance system for feeder roads should: 30 V.P.D.) roads are: * make the maximum use of casual labor in the to provide an all weather vehicular access at a level vicinity of the road; of service commensurate with the role of the road; and * enable planning of routine and periodic maintenance and their accommodation within the budget to preserve the initial investment in the road. provisions; The deterioration characteristics and maintenance * require the minimum of form filling, reporting, and requirements of earth and gravel roads are very administration commensurate with good planning different from those of bitumen roads. By comparison, and control; bitumen roads represent a far greater capital investment and, despite being normally subject to higher traffic * be less sensitive to the availability of supervision loading, their rates of deterioration are usually much vehicles; slower. This allows more time for inspection and iden- tification of maintenance needs, and the planning of * enable effective control of the lengthmen in their works implementation. work output and quality; On the other hand, feeder roads can deteriorate very * enable formal or on-the-job training to be carried quickly-in a matter of months-without proper main- out for all levels of personnel compatible with their tenance. Bitumen roads can remain serviceable from background, previous experience and understanding one year to the next with little maintenance inter- of maintenance. 147 Kenya: Rural Road Maintenance - Case Study Periodic Maintenance moreheavily trafficked minor roads using the labor based system were as follows: The RARP/MRP programs are using a periodic mainte- nance system based on regraveling utilizing tractors and Routine Maintenance trailers. This has provided an effective system which Rural Access 220-280 KL*/km/year utilized the same equipment that has been so successful Minor Roads 260-320 KL/km/year in the improvement works. Periodic Maintenance Costs Rural Access 250 KL/km/year Minor Roads 340 K/km/year As presently constituted, the costs for maintenance of the lightly trafficked rural access roads and the 1 KL = $1.1 148 Topic B: Case Study Lesotho: Equipment Management* Lesotho became independent in 1966 and following this A number of observations were made at this time, event, great emphasis was placed on national develop- namely: ment, in particular, development of the road infra- * productivity was low; structure. * the fleet had outgrown the service capacity of At this time, ownership and control of all road PVPS; construction plant and equipment was vested in the Roads Branch of the Ministry of Works. As early as * there was an acute shortage of managerial and 1969, it became apparent that if road development was technical skills; to proceed at the hoped for pace, a more professional approach to management of the plant and construction * the size, composition and condition of the fleet equipment was needed. Specifically, there was a need needed attention; to introduce an accounting system which would make adequate provision for the timely replacement of worn * customer relations were not good; out life expired plant and equipment. * there were deep-seeded accounting difficulties and After careful consideration, the Government of Lesotho organizational problems; and opted for a plant hire scheme, and a government Plant and Vehicle Poll System (PVPS) was established in * the proportion of staff time spent on training had 1972. The Pool assumed ownership of all mobile plant slipped from 2.0% to 0.3%. and vehicle formally held by Roads Branch, following which Roads Branch and other user departments were A series of policy decisions were made by the PVPS to obtain their plant requirements by hiring from the management and the Ministry of Works over the next Plant Pool at rates fixed by the latter so as to make year. These were: adequate provision for operating and maintenance costs * reduction in fleet size; and for purchase of replacement plant as and when necessary. * reduction in spare holdings; The establishment of the pool system created manage- . the rehabilitation of vehicles and plant; ment and staff problems within the various organiza- tions. Resistance to change and a differing view on * regionalization of services; priorities caused difficulties which resulted in a relati- vely poor service being given. * use of outside repair and servicing agencies; By 1983, the Lesotho PVPS was in serious difficulty * commercial hire; compounded by low productivity, an oversized fleet, inadequately skilled artisans, and almost non-existent * purchase of spares from main agents; senior management. The result was very low availabili- ty and workshops full of broken-down equipment and * review of hire changes; and vehicles, some of which had been broken-down for a considerable time (see Appendix 1). Technical assis- * increased training. tance was provided under the World Bank Third Highway Project to strengthen the management of the The effect of these decisions is seen in the following PVPS. pages. This case study was prepared by the International Labour Organization (ILO). 149 Lesotho: Equipment Management - Case Study Funding Repair of PVPS Plant by Private Repairers. This also works well, and a substantial proportion of PVPS To provide adequate funding, it was essential to set plant repair is done this way. Recently, the work has accurate and realistic hire rates. If the rates were wrong, been inhibited by attempts to insist on three competitive the hire scheme would be unable to fulfill its functions quotations before any job is contracted out. This is not whereas if they were too high, there would be vocife- practical with many plant repairs. rous calls from user departments for the hire scheme to be abolished. Repair of PVPS Vehicles by Private Repairers. All major accident work and a proportion of repair work is The hire rates in use in 1983 had last been revised in contracted out, an arrangement which also works well. 1989, and did not reflect true costs. New hire rates No difficulty is experienced in getting competitive were introduced in April 1984, and revisions were made quotations for accident repairs, but there can sometimes in 1985, 1987 and 1988. These regular revisions have be a problem with mechanical repairs. kept the hire rates in line with costs and the Plant Pool fund balances are in a healthy state. Regionalization Fleet Size The PVPS organization was very heavily centralized in Maseru. A degree of regionalization has been achieved, In 1983, the plant and vehicle fleet had 'become too but there is still a long way to go. Regionalization large to manage. Many of the items were old and/or cannot really be expected to function until there is a unserviceable while others were of types or sizes not Regional Mechanical Engineer/ Manager in each region favored by Roads Branch. The fleet had been reduced with a strong executive powers and responsibility for until, at the end of 1988, it stood at 157 units of plant everything that happens in his region. This brings us to and 1,121 vehicles. About 20% of these items are under the next heading. five years old. The ultimate aim is to have about 33% of the fleet under five years old which will be achie- vable, provided proper hire rates are maintained. Training This fleet is capable of meeting the core requirement of In 1983, there were no mechanical engineers on the Roads Branch. Peak or special requirements are met by staff of PVPS. There are now three with another six hiring in from the private sector. in training. It is hoped to be able to post Regional Mechanical Engineers to Northern and Southern Use of the Private Sector Regions in the not too distant future. Progress has also been made with the recruitment of technicians into The private sector is used in four ways: vacant supervisory posts after completion of courses at Lerotholi Polytechnic. Hire of Privately-Owned Plant. The PVPS plant fleet provides the core and additional requirements are These measures have materially improved the situation hired from the private sector. This system has worked of Plant Pool, and it can be confidently predicted that well. Private sector plant hire in Lesotho is well given a positive attitude the improvement will continue. organized and rates are comparable with PVPS rates. The ability of private plant hire firms in Lesotho to The establishment of a plant hire pool where such was meet peak requirements was proved during a period of not previously in existence and its effective manage- sustained high demand by Road Branch from January ment so as to provide a good service to Roads Branch through October 1988. During this period, with utili- is not easy, and it should be recognized that success zation of Plant Pool machines averaging 74%, the takes time. private sector supplied plant at a level more than 200% above the same period in 1987. Finally, it should be appreciated by funding agencies who provide aid to developing countries that by their Hire of Privately-Owned Vehicles. Again, PVPS actions they may sometimes inadvertently contribute to provides the core and additional vehicles are hired. This the aid recipients' problems. This is caused by works less well. Private sector vehicle hire in Lesotho insistence upon the supply of a particular type of is fragmented, but it is possible to obtain vehicles of the machine, either because it is the lowest in price or type required. Hire rates are set by PVPS management, because it is manufactured in the donor country, even which is one reason why the system does work well. A when it is non-standard in the recipient country and better service might be obtained if rates were allowed when no spares or service support is available. On a to float. more human level, great care should be taken in the 150 Lesotho: Equipment Management - Case Study selection of personnel to provide technical assistance. cultural differences, especially the latter, can and do Technical expertise is, of course, a basic requirement create communication problems which may largely but it must be understood that language difficulties or dissipate any amount of technical know how. Appendix 1 Figure 1. Growth of Vehicle Fleet Figure 2. Growth of Artisan Staff 1978-1982 1978-1982 1500 90 80 / 70 z 1000 - - 0 50 40 0 30 * 20 10 0 0 1978 79 80 81 82 83 84 1978 79 80 81 82 83 84 Figure 3. Decline of Senior Management Figure 4. Vehicles Awaiting Action in Staff 1978-1982 the Maseru Yard 1978-1982 15 I ' * . . .500 Financial Controller 1 Plant Manager 1 Vehicle M1anager 1 13400- -- Engineers 7 10 I I N 1 300-- -- 200 - -- - - - 5-- 100 - - 0/ 1978 79 80 81 82 83 84 1978 79 80 81 82 83 84 Figure 5. Man-Days Spent on Training 1979-1982 3000 2N 2000 0 NN 0 1979 1980 1981 1982 1983 151 Lesotho: Equipment Management - Case Study Appendix 2 PLANT AND VEHICLE POOL SERVICE 1983 1989 Workshops 8 8 Bays 57 60 Staff Engineers 0 3 Mechanics 67 99 Spare Parts Value m 680,000 m 452,000 Fleet Strength vehicles 1,387 1,121 Plant 205 158 Availability 44% 77% Utilization 43% 71% 152 Topic B: Case Study Madagascar: S.C.C.C. - Small Local Roadworks Consulting Firm* The Project * clearly in even the short term, the existence of only two local firms is undesirable from a competitive The project started in 1985 with a broad objective of standpoint; and introducing labor-based methods into the Malagasy roadworks industry. Such methods had been abandoned * the promotion of small/medium-sized firms would in the 1950s when construction methods were mecha- greatly facilitate the design and control functions of nized. Mechanization was in response to the (at that future rural roads programs. time) very low population density, full employment, and the fact that mechanized methods suited the expatriate or French-trained local engineers. Roadworks were carried out by the Ministry of Public Works under Organization force account or by international contracton Labor- based methods were retained only in the form of The Project HIMO (Haute Intensit6 de Main d'Oeuvre) lengthmen paid directly by MTP or the local authoIties has had funding from ODA, NORAD, the Dutch and concerned. Consequently, no small roadworks Swiss Governments, and UNDP. So far it has contractors or small local consultants were required. completed about 300 lan of feeder road rehabilitation, almost always with a gravel or stone wearing surface. Major roadworks on bituminized roads are still carried out by international contractors and international Up to and including the 1988 construction season, all consultants, but in many cases the consultancy role is specification, design and overall control has been done a joint venture between a foreign and a local consultant. by the project team. However for 1989, the design and In the roadworks sector, there are four foreign consult- supervision role will be partly contracted out to local ing firms with a branch in Madagascar and four further consultants. This follows a successful experiment in foreign firms are in the country on a contract basis, in 1987 in which the firm S.C.C.C. and a similar sized addition, there are some five foreign firms (multi- "transplant" were contracted for the supervision role. sectorial) that clearly could undertake roadworks and two major Malagasy firms of consulting engineers The supervision role for the works undertaken differs active in the roads sector. The two major Malagasy substantially from the same role when a major road practices are both "transplants" one by privatization of contract is undertaken by a major contracting firm. a parastatal and the other by localization (in terms of Firstly, a considerable amount of detailed "adaptive" personnel but not entirely of ownership, of a foreign design must be carried out on site to fit the road into consultancy. the intricate irrigation and other systems of smallholder (mostly rice) agriculture in mountainous terrain. The project constructs low-cost feeder roads by labor- Secondly, the level of contractor experience is often based methods and the following became apparent: very low and in some cases so is technical knowledge; this requires the supervisor to offer suggestions and * in anything but the set-up stage of the program advise very much more than simply approving or foreign consultants would be too expensive; refusing proposed modifications, inspecting quality, measuring and controlling the works. * existing local firms active in the roadworks sector are all based in the capital Antananarivo; The S.C.C.C. experiment did indicate that if consultants are to be used, they should at least contribute to the * existing local consultants are set up on western lines design phase even if only by way of detailed familiar- with highly qualified, overseas-trained senior staff, ization prior to the commencement of work. Where ade- and consequently are not specialized in labor inten- quate experience exists, the full design commitment sive methods or design; can, and in some cases, will be contracted out. Adapted from Anil S. Bhandari and Kwasi Abbey-Sam - Proceedings of Seminar G, PTRC Summer Annual Meeting, University of Bath, England, Vol. P. 309 (1988). 153 Madagascar: S.C.C.C. - Small Local Roadworks Consulting Firm - Case Study Promotion of Local Participation Performance Comparison Local participation by consultants has been confined to The only available comparison of performance is with publicity and seminars. Many local firms of consultants contract works supervised directly by MTP's own staff. exist although relatively few (see paragraph 1) are Although qualified to similar levels of expertise, MTP active in the roadworks sector. It is assumed that staff are not used to supervising contractors at this level sufficient consultants in the buildings or irrigation since the norms are either overall supervision (high sectors will add a roadworks capability to their reper- level) of international contractor/major consultant toire of services to satisfy any immediate demand and combinations or direct labor works. Staff appropriate that from so strong a potential base, new firms will be for supervising small-scale works are much better at created to take advantage of any residual opportunities doing the work than supervising and counselling con- in the market Promotion as such consists simply of tractors. It must also be admitted that the somewhat making works available on a consistent basis. flexible standards applied to MTP's own force account works (due to fixed, hastily prepared and often under- funded budgets) can carry forward into attitudes The Company under Review towards work standards in general; whereas under an agreed contract that is fully funded no such compromi- The S.C.C.C. consultancy has three principals, one non- ses are necessary. In bringing a professional consul- executive director, one civil engineer, and one architect. tant's attitudes to bear S.C.C.C. did a good job at a The two executive directors trained and qualified in price that is reasonable as an on-cost to construction West Germany (Bauschule) and returned to Madagascar expenditure. The cost of this service is estimated at in 1980. S.C.C.C. was set up in 1984 and operated enti- being only 40%higher than the similarly inclusive cost rely in the buildings/structural sectors. The firm is of the same work carried out by MTP. However, the retained by a substantial local building contractor as estimate takes no account of any differences in quality "tied" designer for design and building contracts. The level or the indirect benefit of reducing work load and firm currently employs two further civil engineers and administrative cost within the Project HTMO. two senior technicians trained in Madagascar. All three civil engineers and the two technicians have polyvalent capacity including both structures and roadworks, their experience is heavily weighted towards structures. Contract Format Roadworks can however be undertaken to top up exist- ing work load, and the firm would like to have a The contract format was very simple and set out the permanent and increasing commitment to this sort of contract conditions; the services to be provided and work. The firm also employs eight ancillary workers standard forms to be filled in by tenderers to build up (draughtsmen, secretaries, etc.). price and indicate the capacity and intentions of the tenderer. Personnel prices were based on man-months per specified type of personnel while transport and Effectiveness office costs were on a fixed price monthly rate. Perhaps rather curiously, but normal in Madagascar, the cost of Clearly the experience under this project for S.C.C.C. monthly inspections by client and MTP staff was also in the roadworks sector amounts to little more than a included as a reimbursable item (receipts + 5%). Pay- sideline to an existing and solidly based consulting ments were by net monthly account from commence- practice. The firm supervised the work on five simulta- ment of the works. neous contracts in the Antsirable area totaling 51.6 km. Construction was between September 1987 and March 1988 (all but one terminated early-January 1988). The supervision contract cost an inclusive US$8,700 which Further Promotion amounted to 5.6% of the net construction cost. Geotechnical testing assistance by the LNTPR (National As indicated in paragraph 3, it does not seem likely that Public Works and Buildings Laboratory) cost a further the solidly established consulting industry in Madagas- 2.5% on construction costs. All five sites were car will need any significant encouragement to expand eventually completed to an acceptable standard and with into and fill any opportunities that may arise in the road a minimum supervisory/control input by MTP staff. design and supervision sector. Existing finns plus new S.C.C.C. management was satisfied with the experience firms created by spin off from these should be able to and the Project HIMO judged the firm to have fulfilled train up new staff at a rate commensurate with any its task satisfactorily. envisageable growth rate. 154 Topic B: Case Study Madagascar: Ets. Razakamandimby - Small Local Roadworks Contractor* The Project for routine maintenance work the Government of Madagascar and the provincial authorities. At the end of 1986, the Government of Madagascar launched a program to promote the formation of small/medium-sized companies with a view to their The 1988 and 1989 maintenance programmes cover participation in the industrial sector (artisanal or import some 5,000 km of roads of which about 4,000 km is substitution activities) and the construction sector tarmacadam surfaced (although some 1,500 km of this (materials, buildings and roadworks). The Ministry of is in fairly poor condition). Public Works (MTP) has since been active in necessary promotion for the construction sector but with relatively The Dutch Government financed the rehabilitation of little need to intervene in materials production which is 94 km of secondary roads in 1987 and has a program mostly industrial and not, therefore, public works or the for 89 km in 1989. NORAD financed rehabilitation of building industry which is already largely dominated by 42 km in 1988 and has a program for 68 km in 1989. local companies for both design consultancy and cons- Within the MTP's labor-based "umbrella" project truction itself. Roadwork has traditionally been (Project HIMO-Haute Intensit6 de Main d'Oeuvre), completely dominated by international contractors and the government and local authorities (in some cases consultants for new works and force account operations with WFP funds derived from rice sales) have financed by MTP for maintenance work of all kinds. Since set- about 150 km to end-1988. The UNDP financed 36 km ting up a roadworks contracting company would nor- in 1986. Both EDF (101 Km scheduled so far for 1989) mally require a very substantial initial investment in and IBRD with the PASAGE project (about 800 km for plant and implies that work be let in substantial sized 1989-90) are now participating in the overall program. contracts, it was decided that initial programs (at least) All the roads are secondary by character and generally be labor-based in method and divided into construction in very poor condition requiring comprehensive rehabi- contracts of 6 to 12 kilometers in length, thus limiting litation/reconstruction but relatively few major initial investment as far as could practically be earthworks or large structures (over 6 meter span). arranged. As a general rule, the routine maintenance works at end The whole promotion campaign has been backed by 1988 prices cost US$140 to US$270/km, and rehabi- training programs: for small contractors to undertake litation works cost US$3400 to US$8000/km so that independent contracts (financed by ODA and NORAD), although the combined construction budget to date is and for small contractors to undertake subcontract a modest US$2 million, it has taken time to mobilize works (financed by the Swiss Government). funds, train contractor's staff, and is constrained to only committing funds to suitable contractors The works themselves have been financed by a variety with adequate resources (all types) to execute the of funding agencies: works. * for rehabilitation works: the Dutch Government, The training program has so far involved 298 tech- NORAD, UNDP, the Government of Madagascar, nicians of which 254 were sent by 200 small con- WFP, and several local provincial authorities; tractors in Antananarivo, Fianarantsoa, Mahajanga and Toliary Provinces. MTP technicians trained include * for subcontract works: the Swiss Government and two training officers from each of the six provinces of NORAD; and Madagascar. * Prepared by Mr. Lindsay Thomas, of Scott Wilson Kirkpatrick & Partners, Roads Adviser to the Government of Madagascar. 155 Madagascar: Ets. Razakamandimby, Local Roadworks Contractor - Case Study Organization Works and Buildings Laboratory. His wife, who is a university-trained (Madagascar) engineer, remains To a large extent funding has been made available to employed outside the firm. To assist with site works, he MTP by the various funding agencies outside of an employs two young technicians with diplomas from the integrated project. While often tied to particular roads, Antananarivo Technical College and six skilled workers the Project HTMO has been responsible for planning, to act as group leaders. However, all employees are specifying, designing and the general control of the subject to periodic lay-off when no work is in progress. works. Some works in each year have been done by Between September and December 1987, the firm force account so that MTP has a precise idea of costs, rehabilitated 6.7 km of a difficult road from Fandriana and some supervision of site works has been contracted to Tsarazaza (Dutch Government funds) for US$22,000; to local consulting firms. The great majority of works from March to May 1988 subcontract works on the has been contracted out to recently formed small road- Mandraka descent, National Road 2 (Swiss Government works contractors. The project team currently comprises funds) for US$8,000, and July 1988 to January 1989 four Malagasy engineers, two expatriate specialists in completed 10.6 km from Faratsiho to Antsampa- labor-based works, ten technicians, and some 15 nimahazo (NORAD funds) for US$62,000. Starting supporting staff. with just one pick-up (Peugeot 404), the firm has since acquired two Mercedes ten-ton tipper trucks and a one- ton vibrating roller. Plant purchases are all second-hand, Promotion of Local Participation but functional with effort. Local participation has been promoted almost entirely by positive means such as training; choosing technology Effectiveness suitable for low budget start up; a mix of rehabilitation, subcontract and routine maintenance work; ensuring that With no initial problem to raise outside financing, the local commercial banks have available loan funds; firm has carried out works promptly and within agreed making contract analysis available to bankers if so time delays. The quality produced is eventually accept- required; hiring out available MTP equipment to some able but only becomes so after control pressure is participating contractors; and seminars aimed at clarify- brought to bear. All work has been obtained as a result ing setup procedures/advantages/difficulties/discussion. of open tender at normal prices for the type of work involved. Plant purchases suggest and the proprietor No price advantage has been necessary since such small confirms in imprecise terms that operations so far have scale works are of no interest to major contractors and been profitable. The proprietor stated that the moreover labor-based methods cost between one-third investment and risk had been worthwhile. One unusual and one-half of equivalent machine-based methods for aspect of the NORAD-funded work recently completed which major contractors are set up. was that the contractor was obliged by the contract to employ 25% female labor. Since this company had The only artificial advantages that may be considered decided of its own accord to employ female labor on as existing to a limited extent are low hire rates on the Fandriana-Tsarazaza site, the project staff had agricultural machinery in the dry season and the ability anticipated no problems with this requirement. of MTP to provoke a favorable response from local However, several strikes occurred, and direct bankers. All charge rates are, however, based on com- intervention by project staff was needed to resolve mercial reality in Madagascar. In addition, a very few differences that arose. This has given rise to the local contractors who have been formally "approved" conclusion that control of site works must also include benefit from a favorable tax treatment in the first controls designed to protect ordinary laborers from four years after approval, a promotional device common possible unfair exploitation that might arise. to very many developed countries. The Company under Review Performance Comparison The quality standards achieved by Ets RAZAKAMAN- For the sake of clarity, this study refers only to a single DIMBY are average by Project MO norms. As is gene- company which can be regarded as fairly typical of the rally the case with roads built by labor based methods 14 firms that have so far done road rehabilitation the long section is slightly inferior (undulations of works. Ets RAZAKAMANDIMBY is a family-owned several metres wavelength) to roads produced by firm set up in early 1987 in response to MUP Publicity mechanized methods, but the cross section and drainage aimed at promoting the formation of such firms. The works are as good and in some cases better. Since principal of the firm (after whom the firm is named) vehicle speed is not a major criterion on the very had been until end-1986 employed for 16 years as a winding mountain roads of Madagascar an undulating senior geotechnician by LNTPB, the National Public long section is not considered a major drawback. Many 156 Madagascar: Ets. Razakamandimby, Local Roadworks Contractor - Case Study other factors mitigate in favor of labor-based methods Due to a poor history of what can occur if advance in this gravel scarce country, such as ability to exploit payments are made, NO advance payment is allowed very small or thin deposits and to use techniques such but certificates can be requested on a monthly basis as waterbound or surface stone macadam and even provided certain minimum amounts are ready for cobblestones. measurement; generally this is 1 kilometer completed. Upon certification, interim payments are usually made The small contractors clearly have to make a profit, pay within two weeks and final payment within six weeks. turnover tax (15%) and company tax, but in general can A 12-month maintenance period on 2% retention is complete works to similar standards and at the same usual. cost as MTP can achieve by force account. Naturally MTP is to some extent constrained by bureaucratic A considerable amount of detailed design is done on procedures and delays which appear to equal in cost site by agreement between the contractor and the super- terms, the commercial and fiscal constraints on contrac- vising engineer. This is to enable the contractor to tors. Major (international) contractors using mechanized propose materials that are actually available and in methods generally charge about 2-1/2 times as much as relevant cases methods of carrying out the work to suit a small local company for rehabilitation of secondary such materials and/or resource constraints and/or (not bituminized) roads. unforeseen conditions. Between a call for tenders and contract award, a time lapse of only six weeks has been achieved due to the small scale of the contract and the simple form of Further Promotion contract documentation. Most of the conditions for promoting continued growth Contract Format in this type of work are already catered for: training, bank financing, fiscal treatment, limited plant hire The contract comprises: standard conditions into which facilities and advisory services. The main constraint is the identity of the job, its timing and any special financing to improve plant availability, create a steady conditions can be inserted; a standard materials specifi- work load during the year and indeed a coherent pro- cation of norms to be achieved during construction; a gram from year to year. bill of quantities that comprises 20-30 inclusive items subject to remeasurement; a description of the works The long-term plan anticipates that small contractors that concentrates on those principal items and indicates, will either grow or merge into medium-sized contrac- when minor exceptions occur, with which item the tors, and that the most capable and successful firms will exception is to be included as a spot price; and standard eventually become large companies able to mechanize forms to be filled in by tenderers to build up price and their operations and compete successfully for major indicate the capacity and intentions of the tendered. contracts by international tender. 157 Topic B: Case Study Nigeria: Use of Local Contractors and Consultants* Introduction framework. This approach to the economy is interna- tionally considered to be appropriate. (1) Faced with necessary reconstruction after the 30-month old civil war, which ended in 1970, and the challenges The main feature of SAP is the marketization of the of developing the Nigerian economy, the ruling military country's monetary system, which the government administrators found solace in the world energy crisis considers the best route to finding the true value for the of the 1970s and the attendant booming of the oil overvalued currency--the Naira. Its initiation fulfills one dependent economy. Development policies were con- of the conditionalities of the International Monetary centrated on mass education, construction of road Fund (IMF) and the World Bank for financial assis- infrastructures and the nursing of newly acquired capital tance. As a result of this policy, the purchasing power intensive industries. Urbanization grew due to better of the Naira in international market has fallen quite wages and employment prospects in the cities. This led drastically (see Table 1). Consequently, local industri- to the neglect of rural agriculture and food production. alists (including construction contractors and consul- There was also a rapid growth in population from the tants) are faced with the urgent need to seek alternative initial rate of 2.5% in the 1960s to 3.3% in the 1980s. local sources to expensive raw materials, labor and The nation's current population of 112 million is equipment. The citizens' taste for foreign goods is heading towards 200 million in early 21st century. By gradually changing. Also at the federal and state the year 2030, Nigeria will be the fourth most government levels, attitudes are changing to maintaining populated country in the world! existing infrastructures rather than the former replacement approach. This was described in the 1989 Since the steep decline of oil price in 1981, the Nige- budget as the rise of the 'maintenance culture' instead rian economy has been on the decline. There has been of the 'replacement syndrome' of the profligate past. capital flight to foreign countries. This is reflected in The federal government has also reduced subsidies on the country's external reserve dwindling from a height petrol thereby making a saving of N488 million which of US$9.8 billion in 1980 to its current US$1 billion has been diverted to a Special Projects Fund to finance mark. Also, the standard of living of Nigerians has projects such as the maintenance of roads and railways. fallen closely in line with the decline in per capita income from US$1000 in 1980 to its present US$370. With these realistic changes in budgetary policies, the Subsequently, the country has been regraded by the country has attracted favorable international commenda- World Bank, from its former middle-income group, to tions. It has also been able to reschedule its enormous one of the world's poor countries. US$26 billion debt and the way now seems to be clear for a considerably greater coordinated inflow of foreign In an attempt to revive the economy, the government assistance (2). The author believes that Nigeria epito- introduced a Structural Adjustment Program (SAP) in mizes a Sub-Saharan African country needing ideas on 1986. This program aims at removing the constraints to policies regarding road maintenance at this critical time free enterprise with government's reliance on private in its development. Hence it's choice for this case initiative while providing the necessary infrastructure, study. incentives and maintaining the general macroeconomic * Dr. Paul Olomolaiye is a lecturer at Obafemi Awolowo University, le-Ife, Nigeria. 158 Current Road Maintenance Practice in Nigeria otherwise called Direct Labor Organizations (DLO)-em- The first reaction of government parastatals to the ploy operatives on fixed monthly wages and with shift in emphasis to maintenance was the reinforcement equipment/ plant acquired over the years, maintain of existing in-house maintenance sections in States' roads within their areas of jurisdiction. Road patching Ministries of Works and the Federal Directorate of forms the major bulk of maintenance work carried out Roads. These in-house maintenance departments- by these DLOs. Table 1 - RATES OF EXCHANGE FOR THE NIGERIAN NAIRA, 1981-1988 End- Market Nominal Real Period Ratea/ Effective Rateb Effective Rate bj 1981 1.5701 103.4 110.8 1982 1.4920 108.2 113.7 1983 1.3359 112.3 134.3 1984 1.2372 120.4 185.0 1985 1.0040 110.4 166.0 1986 0.3015 61.6 90.9 1987 0.2415 16.6 26.5 Mar 1988 0.2329 15.7 n.a Jun 1988 0.2318 15.4 n.a Sep 1988 0.2136 17.4 n.a / US dollars per naira bj 1980 = 100 Source: International Currency Review, No.4., 1988. However, inefficiency and lack of enterprise, which is Since government departments do not have the neces- common in most government parastatals in the country, sary facilities for large maintenance works (e.g., asphalt prevail in these DLOs. Construction plant and equip- plants, quarries, etc.), such projects are often contracted ment are not well maintained due to stringent bureau- out to contractors. These may include road resurfacing cratic controls, shortages of spare parts or absence of or new overlays to township roads at State or Local necessary expertise in government ministries to main- Government level. Although the regional offices of the tain them. Even when the DLOs eventually maintain Federal Roads Department can undertake larger roads, the jobs are done in the rainy season when the maintenance projects they also contract badly deteriorat- road deterioration problems are worst felt by the ed roads (e.g., Benin-Lagos express road), to private citizens but when no patching would stick! It is contractors for maintenance. All major roads (trunk A) doubtful if government departments can cope with road linking the 21 states of the country are the responsibili- maintenance since they are not geared to sound finan- ties of the federal government, while those linking cial management which is necessary in the construction towns (trunk B) are managed by the states and those business environment. within towns and in and between villages are the 159 responsibilities of the local councils. There is, however, setting up large construction sites. This was necessary some overlapping of these responsibilities. As roads are because foreign contractors, with their large capital contracted out for maintenance, they are supervised by base, out performed the local contractors in large-sized officials from the Ministries or Directorates. Small contracts. While most Nigerian construction companies maintenance contracts often lack any detailed form of abused this privilege by absconding and going into contract. voluntary liquidation, AZ was faithful and has pros- pered in contracting business. Current turnover exceeds For example, on recent road maintenance contracts N300 million in 17 states and a fleet of over 250 awarded by the directorate of rural roads in one of the construction plants and equipment. states, the directorate issued invitations to contractors to "regrade and resurface local roads with gravel" at The company has built up the personnel and expertise N12000. No other details (e.g., bridges, levels) were required for the broad spectrum of civil engineering given. Well established and reputable local contractors projects undertaken by the company by employing failed to apply for these contracts as such vague terms foreign professionals who have taught their indigenous of contract would lead to losses. The government deputies, across projects, the art of profitable construc- consequently persuaded them to take up at least 10 km tion management. Because of the devaluation of the length of road at that price. However, on larger (states Naira and the consequent reduction in the value of their and federal) road maintenance contracts, there are home remittances, these foreign professionals have detailed designs and specifications with a legally started leaving the country with Nigerians being pro- binding form of contract. The forms of contract vary moted, becoming more motivated (see Olomolaiye and from one contract to the other but largely reflect the Ogunlana (3)), and new employment being generated. British standard forms (see Okpala and Aniewu (5)). Although AZ does not have any new road maintenance Although there used to be some payment difficulties contracts at the moment, they are bound by the terms of between 1983 and 1986 resulting in the abandonment of a former contract, the 'maintenance period' clause, to many road maintenance contracts, the situation has now maintain township roads valued above N10 million. improved with the government paying contractors Although the maintenance period is only one year on regularly-one of the advantages of the earlier two other road maintenance contracts, AZ has continued mention SAP. maintaining these other roads for the past three years because they are still in the area. It is the company's The approach of a typical Nigerian contractor who has policy to maintain beyond the 'maintenance period' undertaken some road maintenance projects for both while still in an area as long as the costs are reasonable. state and federal governments in the recent past and has The company adopted this policy to maintain good outlived the economic turbulence in general road reputation and avoid any possibilities of political maintenance and construction by skillful organizational intimidation. Maintenance during the mandatory period structure and awareness of Nigeria's economic and is done through a system of monthly checking of these political cultures is now examined. The name of the roads, reporting to the head office and then carrying out firm is withheld for confidentiality purposes and would the necessary maintenance after costing. simply be referred to as AZ Nigeria Limited. In the township road maintenance contract which was to overlay with asphalt, the personnel consisted of a The Contractor site agent, a site supervisor, one foreman, one mechanic, three operators and rakers whose number AZ Nigeria Limited is an indigenous civil engineering depended on the length of road to be done on a company established in 1976 during the oil boom era. particular day. The equipment involved were two steel Its establishment was encouraged by the Government's drum rollers, one tyre roller, two jerk hammers, two initiative to increase indigenous participation in medium pavers (one as stand by) and some shovels. In addition to large sized construction projects. Under this program, to these the company owns several other equipment. the Government devised the 'mobilization fee' clause Considering the high cost of equipment repairs the whereby 10% of the contract sum was given to indige- company was asked a pointed question on equipment nous contractors to cover initial overhead expenses of maintenance. 160 AZ has a central plant workshop with a general plant within the Nigerian cultural setting, eluded these manager who monitors equipment utilization and foreigners. With recent economic hardships, many maintenance. On the township road maintenance pro- foreign contractors did not find it difficult to sack their ject, the equipment averaged 80% productive time employees and join the capital flight train, i.e., selling which is high considering Lashabi's report on plant their equipment and moving on to 'greener pastures'. utilization in Nigeria (4). The central workshop is fully manned by Nigerians, trained under the expatri- Due to the urgent need to maintain some major roads, ates, who have acquired the expertise to make and the government contracted out to some foreign contrac- modify spare parts or even the whole plant. Parts which tors still in the country. These contracts are paid for in cannot be made, modified or purchased locally are oil (under counter trade agreements) while those done ordered from overseas. But for unexpected repairs, all by indigenous contractors are paid in Naira. Oil fetches major repairs and plant overhauling are done during hard currency while the Naira depreciates daily. While the rainy season when road maintenance cannot be indigenous contractors are struggling to survive and be effective. innovative with the resultant development of the nation's technological competence, foreign contractors AZ Nigeria Limited currently has its own asphalt plants simply buy parts from their home countries. This unfair and 12 quarries within its catchment. This gives it mode of payment in the construction market place distinct advantages over the government DLOs or any needs to be removed for both foreign and local new contractor in AZ's catchment, who normally ask contractors to compete fairly. If the current economic the company to supply aggregates and asphalt. These state persists, the author believes that foreign quarries and asphalt plants helped to ensure AZ's contractors would either leave or stay to contribute to economic survival over the past 12 years. While AZ construction and maintenance development in Nigeria. pays the Nigerian Mining Corporation for quarrying licence, it also fulfills its social obligations to local communities around the quarries. For example, the A Business Reorientation Program company has just built a hall for one of such commu- for Established Contractors nities. While foreign contractors are sometimes forced to bear such social responsibilities to the communities As mentioned earlier, the 'mobilization fee' clause was because they believe that their mining license suffices, introduced to encourage local contractors to form large indigenous companies do not find it difficult to under- construction businesses. While this policy helped AZ to stand, and company chairmen may even be rewarded acquire equipment and be established today, it was with an honorary title. The social costs are incompara- doomed by not recognizing that most of the civil engi- ble to the apparent cost advantage of such quarries in neering companies set up in the 1970s were not setup reducing overheads and making the company's tender by 'career construction professionals'. This omission for road maintenance more competitive than other accounted for 90% of these firms winding up after contractors. This advantage was demonstrated in the collecting the mobilization fee which many, unfortuna- township road maintenance project where the contractor tely, saw as their legitimate share of the oil boom. Any was able to undercut the nearest bidder by a wide attempt at motivating the local contractors should margin and still make a handsome profit. recognize the professional background of new contrac- tors. In fact, any motivation package should focus on Possible Road Maintenance Strategies in Nigeria established local contractors. These established contractors should be part of a government retraining AZ Nigeria Limited epitomizes some of the advantages program which should have its main focus as "Contrac- postulated in the main policy paper of local contractors tor Reorientation". The main features of this reorien- undertaking road maintenance projects. The company tation program should be: already has established offices and a trained indigenous workforce, the effectiveness and loyalty of which the retraining them to respond to economic and politi- DLOs cannot match. While foreign contractors tried in cal indicators. the 'boom' years to buy such indigenous expertise and loyalty with attractive reward packages, the socio- selling some of their heavy equipment as cultural identity which is the basis of employee loyalty additional revenue to maintain just a few needed 161 for road maintenance projects, i.e., an equipment With such a guarantee, a contractor has to do a better optimization scheme. The AZ equipment job as he will only incur more maintenance cost if he conversion initiative may be the model. does not. However, the 'maintenance period' clause in today's contracts is just for one year when no serious training support by the government or any inter- structural defects would have surfaced. national agency to established companies. Long-term maintenance period clauses would help tie Construction Personnel Training Program the contractor down to the road he has constructed or newly maintained. This, undoubtedly, would lead to Although AZ projects a picture of personnel adequacy, higher contract sums for newly constructed and main- this would be an erroneous picture of construction tained roads. It should, however, be remembered that personnel adequacy in Nigeria. The Nigerian construc- the 'cost in use' concept is best demonstrated in tion industry lacks adequately skilled craftsmen, mainly roads. The problem would then be how to tie down the due to the education system which laid much emphasis contractor to maintain roads which are not properly on paper qualification rather than the practical training managed. In Nigeria, heavy vehicles always disobey needed in the construction industry. The available laws regarding axleload weighbridge with impunity. skilled craftsmen were trained on-the-job by different This leads to faster deterioration of the roads than contractors and the few trade schools. Unfortunately, normally envisaged in any maintenance contract. In the those from the trade schools often feel degraded if authors opinion, the inefficient DLOs should be asked to work as a tradesmen as they prefer to be 'head scrapped and replaced with profit/efficiency conscious men'. Those trained by contractors often have narrow companies charged with road management which would specialization which makes it rather difficult for them include toll collection, enforcement of weighbridge to change jobs. There is an urgent need for a national rules and reporting necessary repairs to maintenance training program for construction personnel to relieve contractors who should be on cost plus fixed fee the local contractors from the burden of employing contracts. The vast equipment assets of DLOs could be unskilled hands and to standardize construction skill sold to profit-oriented plant hiring firms which would acquisition by tradesmen. As the trade school approach render good service to the contractors when they need has failed to produce 'real' craftsmen, the author would equipment. Such plant hiring firms are already suggest a more practical approach inform of a Nigerian springing up in the southern part of the country. Construction Industry Training Center where local contractors can send their recruits for skill acquisition Again, how do we have a long-term maintenance con- at subsidized cost. Apart from a standardized training tract for a badly designed road? Road designs are program, such an institution should also be involved in normally done by the government ministries. Due to manpower forecasting and monitoring for the industry. lack of practical experience, the road designs are often It can also be charged with arranging continuing of inferior quality and offer less value for money than education programs for senior construction personnel. the alternatives which contractors have learned to This is an area of technical assistance which an agency submit with their tenders. By submitting alternative like the ILO or any foreign aid agency could concen- road designs, contractors have acquired better expertise trate to help the local contractors. in road design than even private consulting engineers whose qualitative but expensive solutions are often Long-Term Maintenance Contracts rejected by the government. Also, most of these designs by consulting firms follow international standards which A foreign contractor wanting to have a foothold in road do not recognize peculiar Nigerian geology, climate, construction in Western Nigeria in 1964 offered a ten- and economy. While budgetary constraints have been year maintenance guarantee on a 40-mile stretch of dual the normal excuse for poor quality road designs, road carriageway road between Ijebu Ode and badan, in designers can cut cost by reducing international road addition to other contract clauses. The then Western signs and markings standards. Maintenance cost can be Regional Government awarded the contract to this reduced by concentrating on the main structure of the contractor. The road is on record as one of the best carriageway not on signs, road markings and grass constructed and maintained roads in Nigeria today. cutting. 162 Conclusion them is allowed to thrive. The support needed should be in the form of business orientation courses and a skill monitoring and development centre in the form of a AZ Nigeria Limited has thrived in the harsh business Nigerian Construction Industry Training Center. This climate of the Nigerian construction industry by its should be complemented with the reorganization of effectiveness and responsive managerial drive for government direct labor organizations into two forms of success. Many other local contractors can successfully companies-road management companies and plant manage road maintenance if the enterprise culture in hiring companies. References 1. The Nigerian Naira, International Cunency Review, No. 4, 1988. 2. How Bleak a Budget, West Africa, January 16-22, 1989. 3. Olomolaiye P.O. and Ogunlana S.O., A survey of construction operative motivation in Nigeria, Building and Environment, Vol. 23 No. 3, 1988. 4. Lashabi B.T., An Evaluation of Construction Plant Utilization in Nigeria, M.Sc.thesis, Department of Building, Obafemi Awolowo University, Ile-Ife, Nigeria. 5. Okpala C. and Aniewu A., Systemic Problems in Nigerian Construction Industry, Construction Management and Economics, Vol. 6 No.3., 1988. 163 Policy Issues and Options Topic C: Human Resources Development and Institutional Reform Institutional and human resources development in road of technical assistance. It has become apparent that maintenance are affected by a significant number of effective institutional performance is not so much a socio-economic factors that originate inside and outside question of amassing adequate financial, human and road agencies and have a decisive impact on road technical resources, but of using those resources more maintenance efficiency and effectiveness. Government efficiently and effectively. officials and sector managers need to address these factors and reform road maintenance institutions and the The major institutional constraints facing most Sub- management of human resources. Commitment to Saharan roads agencies are a lack of accountability and institutional reform and human resources development autonomy and a lack of separation of the planning and is critical to the successful implementation of policy implementation functions. reforms. Institutional and human resources performance and Policy Options and Actions development in road maintenance can be addressed by a variety of measures. It is im portant that pollicy makers To strengthen institutional accountability it can be and top managers keep in mind that road maintenance helpful to assess the institutional performance of the institutions and their manpower are the basic resources road agency and its overall service delivery setup. Such for implementing the country's road maintenance pro- assessments should examine existing arrangements and gram. The workforce is usually the largest expenditure their effectivenes. Issues to be considered would include item in a road agency's budget Both institutions and such things as the use of force account and private human resources must be actively managed and in contractors, the allocation of responsibilities nationally effective ways. A good starting point for approaching and locally, the agency's technical and implementation these issues is to conduct an institutional appraisal capabilities, and coordination between government to assess institutional and manpower strengths and entities to develop and implement comprehensive and weaknesses. appropriate road maintenance policies. Such an assessment can be followed up by an appropriate set of The two main issues that need to be addressed are: measures to address the specific problems identified. * institutional reform to, increase institutional Establishing a system to monitor road agency perform- accountability, strengthening overall institutional ance and physical results can also increase accounta- efficiency and effectiveness and providing incen- bility. A basic starting point for improving the tives. performance of any institution is to measure and moni- tor its performance in terms of outputs and physical * human resources development to increase staff results. This is a practical basis for setting standards accountability, motivation and competence, stren- and making improvements. For road agencies this gthen overall manpower performance, and build a means establishing monitoring systems (management core staff of competent professionals. information systems) to keep track of road network conditions, what physical improvements are being Changes in each of these areas will affect the other, as achieved over given periods of time, and the type of the performance of institutions cannot be divorced from work backlog that remains. Such monitoring creates the the performance of the manpower within them. foundation for increased accountability and for an increased specificity regarding what is to be done. Institutional Reform Delivering parts of the road maintenance program through private contractors might also be considered. Problems Lack of incentives to perform is one reason why there are problems with the provision of road maintenance After three decades of investment in institutional and through force account. Contractors have built-in human resources development, Sub-Saharan African incentives to perform well so they will be paid and road maintenance institutions are not performing receive more work. Force account does not have these efficiently and effectively and still need large amounts incentives and the quality of its performance has few 164 Human Resources Development and Institutional Reform practical consequences in terms of rewards or sanctions. operations. Additionally, road agencies operating by force account are hampered by having to contend with major cons- MARMS has assisted management in identifying in traints like civil service regulations, procurement detail the maintenance workload for each management regulations, bureaucratic impediments, overstaffing, and unit and breaking it down to activity level. This has lack of funds. made it possible to set and measure performance for the road maintenance effort as a whole, and also to An institutional environment must be created that will evaluate the effectiveness of the road maintenance increase the accountability of road agencies both to efforts of each management unit. Through the reorgani- road users and to the government agencies that super- zation of road maintenance districts and zones, it vise them. Publics and road users must be better became easier to identify requirements for road main- organized into associations that expect a certain level of tenance supervisory personnel, base camps, and equip- service and can bring pressures to bear. The govern- ment. It also became easier to identify training needs ment must also monitor and expect results. for staff development to increase technical and mana- gerial skills. Giving a road agency more freedom to act-and more responsibility for its actions-by making it semi- Along with the introduction of MARMS, the roads autonomous can also increase institutional performance department was reorganized to provide a structure by freeing the agency of many of the constraints with additional senior technical staff to take inherent in the public sector. Agreements between responsibility for planning, control and evaluation ministries of public works and roads departments that of maintenance rehabilitation. The main changes spell out what is to be achieved and by what means can were: be the basis for such arrangements. A semi-autonomous highway agency operating with a road fund outside the . the formation of a maintenance and construction main constraints of the civil service has additional division at headquarters level. opportunities to improve institutional performance. Increased autonomy makes it easier for the agency to . the formation of a separate road planning division. manage its human resources, financing and procurement independently and more effectively. * the establishment of a mechanical section to take responsibility for the provision and implementation Separation of the planning, works execution and audit of a preventive maintenance program for the functions, coupled with a strengthening of the planning department's basic equipment fleet. function, can greatly improve institutional performance, accountability and specificity are increased when * the establishment of a monitoring unit within each functional responsibilities are separated. Also, improved operational division of the roads department. planning more clearly defines and specifies what is to be achieved, how, and by whom and when. Institutional and position "twinning" in Ghana: Twinning links an operating entity in a developing African Experiences country and a similar organization in another part of the world. A twinning arrangement has been tried out Performance monitoring, management information relatively successfully between Staffordshire County systems, and increased accountability and competition Council in the United Kingdom and the Accra City in Malawi: The maintenance and rehabilitation Council in Ghana. The advantages have been as management system (MARMS) was adopted in 1984 to follows: improve management of the road maintenance program of Malawi's main road network system. the institutional link between like institutions has enabled the inter-relationship between political, MARMS provides the basis for achieving uniform road managerial, administrative and technical problems maintenance levels throughout the country, preparing an to be fully examined. The political and institutional annual work program based on priorities identified from implications of an apparently simple technical maintenance feature and/or condition inventories, and decision such as establishing specific links between an acceptable level of service as determined by policy direct service delivery and revenue collection are makers. It is also used to allocate resources, i.e., labor, more apparent to an institution that faces similar materials, and equipment, prepare a performance-based problems. budget to support the annual work program and sche- dule and authorize work. It includes a framework for * by explaining the Staffordshire institutions to Accra reporting work performance to permit management to City Council staff, Accra staff have been able to control and evaluate the maintenance work program and draw conclusions that may be relevant to Accra 165 Human Resources Development and Institutional Reform while not immediately apparent to Staffordshire recruitment, training needs analysis, organization of staff. training, management of promotion and career development schemes, and administration of once trust has been built up between individuals compensation and benefits; and, within the institutions it is possible to examine not only successful schemes and systems, but also to strengthen the ability of line managers to utilize, identify practices to be avoided and systems that supervise, motivate and develop their staff effec- are no longer applicable. tively. To carry out these goals, the personnel unit and line Human Resources Development management will require development of special skills and the installation of supporting administrative Problems systems. Line management in particular will need to acquire management skills such as how to set objec- Though there is still a shortage of accountants and tives, allocate work, delegate and follow up, set competent managers in many Sub-Saharan Africa roads standards, establish accountability, and provide agencies, the education and training systems have subordinates needed on-the-job training, recognition, produced many good highway engineers, and techni- and feedback. The two sets of responsibilities cians. Notwithstanding, institutional performance has (personnel and line management) should be integrated not improved significantly. This is because these into a single long-term manpower development and personnel have not been effectively utilized, developed retention program. To effectively implement such a and retained. Initially the focus was rightly on training. program, roads agencies should introduce changes in Now it is becoming more apparent that the human re- hiring, promotion and termination practices to strength- source problem is not only one of education and train- en motivation, retention of talent, accountability, and ing but one of utilization, motivation, development, and performance. retention. When free to operate semi-autonomously (but not only There are a variety of fictors which may cause ineffec- in such cases) the road agency can hire only those tive manpower utilization, development and retention, people that it actually requires to do its job. It will not including the authority, rules and regulations of the civil become financially overburdened with staff on the pay- service and resulting personnel policies; conditions of roll that it does not really need. Cuts of unnecessary employment and pay within public sector agencies; the staff can free money for operations, supplies and lack of overall external institutional accountability and equipment and can improve effectiveness and efficiency internal staff accountability; and the level of the road in the use of remaining staff. This enhances the agency's organizational efficiency, structural complexity motivation and retention of competent people. Staff can and general ability to attract, retain, train and motivate be better managed and utilized because funds become technical and managerial staff. available to secure the equipment and supplies neces- sary for them to do their jobs. Since staff obtain the These manpower utilization and development cons- means to carry out their responsibilities, they also tends traints can result in serious problems: lack of staff to become more motivated. The agency's accountability; difficulties in retaining competent staff; semi-autonomy from the civil service can also allow loss of good staff to the private sector, lack of management to promote staff on the basis of merit and on-the-job development and motivation; lack of applica- accomplishments rather than just seniority. A staff that tion of previously learned skills, stagnation and waste does not perform can also be more easily removed from of expensive education and training; and generally low the payroll. This kind of management of human levels of manpower productivity. resources in terms of hiring and firing and career advancement is a very important tool for increasing the internal accountability and motivation of an organization. Policy Options and Actions Another way to improve staff performance is through The build-up of a competent core of managerial and an organization's compensation and benefits system. A technical manpower that can perform effectively in semi-autonomous agency has more flexibility to pay support of institutional objectives is essential. There are people at the level required to retain the kind of talent two main approaches to this: it needs, in competition with the private sector. Even without autonomy, a road agency can still institute create a Personnel Unit within the road organization innovative compensation schemes such as pay directly to strengthen its capability for manpower planning, linked to quantities and quality of outputs and results 166 Human Resources Development and Institutional Reform produced. The compensation system is an important initiatives, it is important to remember that this kind of tool for strengthening manpower management. training should not be academic. It should be practical, job-related, and focussed on essential skills. Effective manpower utilization also requires a good system of position descriptions, management by African Experiences objectives, appropriate work load allocations, and effective staff supervision. These are basic personnel Increasing incentives and staff motivation in Kenya: and work management tools. Good utilization of man- The Minor Roads Programme of Kenya has used a power requires appropriate work load and responsibility number of schemes to motivate and retain staff in allocations within units and within the organization. the program. All permanent staff, for example, are Within a unit, it is the unit line manager's respon- regularly informed of the available promotional sibility; within the organization, any need for overall opportunities. organizational restructuring should be identified and addressed by general management. To ensure the financial viability and success of labor-based construction programs, it is fundamental to It is also important for an agency to identify training maintain high labor productivity. An assurance that needs, and develop and deliver the required courses in wages will be paid promptly can be a strong motivating essential and specific, job-related skills. For training factor. In addition to fixing a wage rate able to attract and other developmental actions to be effective, they a labor force and commensurate to production, it is need to take place in a context of improved manpower important for workers' motivation that they be paid on management and utilization. It is important to remember time. Nothing lowers the morale of workers more than that if manpower management and utilization are not delayed payment. The program ensures prompt payment operatives, people that are sent on training might soon to workers for work performed. be lost to the private sector. If they stay, they may tend to stagnate and not develop in ways that are practical Utilization of labor-based methods for road construction and useful for the organization. and maintenance is a developing technology. The Ministry of Public Works has recognized this by setting When strong manpower management and utilization are up a Technology Unit and a Minor Roads Training in place, in-service training schemes make an indis- School. The Technology Unit was established to pensable contribution to staff development. In addition investigate various technical and organizational aspects to the educational qualifications and experience that of the Minor Roads Programme and determine required staff bring to the job, they need to develop additional responses and also to coordinate studies being under- job-related specific skills and specializations. Careful taken by consultants. Results of the unit's work are training needs analyses should be conducted to deter- disseminated in the Program through revisions of the mine precisely what knowledge and skills are needed Technical Manual, courses, and seminars. The Minor by each category of staff. Arrangements should be Roads Training School is geared specifically to the made for the development and delivery of suitable, training and retraining of personnel in the minor roads applied, in-service courses targeted to the most essential program. It undertakes both theoretical and practical technical, professional, and managerial topics. Needed courses and for the latter, operates construction and courses or course modules can be arranged through maintenance sites. The school intends to use its faci- external educational institutions or sector training lities to train personnel in the rest of the Roads centers; or, they can be developed and offered internally Department. To enhance management skills of senior by an in-house training department. Specialized training ministry personnel, the school, in cooperation with opportunities in managerial and professional/technical donors, has also undertaken special workshops based on areas related to road maintenance often do not exist in Goal-Oriented Project Planning. In addition to these a country. Therefore, special initiatives may be needed workshops, senior personnel have been attending short to make the necessary arrangements with the appro- seminars and courses both inside and outside the priate educational institutions. In undertaking such country. 167 Richard Robinson Institutional Development in Road Maintenance Organizations Introduction support them. This paper concentrates on issues involved in improving It is much easier to build a new road than to maintain the ability of road maintenance institutions to make existing ones; similarly, procurement of maintenance effective use of their human and financial resources. equipment has usually been a simpler and quicker process than its management and operation. In general, The inefficiency of the transport sector in Sub-Saharan planning and coordination have been among the most Africa is a major impediment to Africa's economic difficult areas in which to achieve acceptable levels growth and international trade. Systems suffer from of performance. inadequate maintenance, burdensome regulations and inefficient operations, resulting in high costs and unreliable services. Personnel are relatively untrained Accountability and Motivation and modem managerial practices are sometimes in conflict with social traditions. The situation is made Institutions must strive to be both effective and effi- more acute by the absence of indigenous institutions cient. Effectiveness measures the capability of an capable of addressing these problems. Greater efficiency institution to define, agree on, and meet appropriate in the sector needs to be achieved through improved operational objectives. Efficiency, on the other hand, policies and management of the technical capacity of refers to the way in which resources are used to achieve its institutions. those objectives. Major investments in the past have emphasized civil One approach to increasing efficiency and effectiveness works and equipment rather than the organization and has been to attempt to increase individual and collective management of institutions. The region has not accountability and motivation within organizations. developed the institutional and human capacity to These are difficult concepts to quantify, and it is operate and maintain its transport infrastructure difficult to measure success in these areas in anything and services. The absence in many countries of other than general terms. To overcome this problem, active pressure groups precludes great concern about Israel (1987) suggested focusing on two factors he road conditions at the political levels of government termed "specificity" and "competition". Some maintenance agencies are used for unemployment relief, and there is no reason to expect that efficiency Specificity is defined as the extent to which it is goals will rank high in the agenda of such organi- possible to specify for an activity the objectives to be zations. obtained and their time frame, the methods of achieving those objectives, and the ways of controlling and Despite efforts to improve operational and admi- rewarding achievement. The definition extends to the nistrative performance, it has been difficult to effects of the activity, in terms of how long it takes for establish self-sustaining institutions that can them to become apparent, the number of people and manage road maintenance efficiently or use external activities affected, and the likelihood of tracing the resources effectively. Lacking proven formulae, effects. Thus, the more specific an activity, the more institutional development has had to proceed by inputs, performance, and outcomes can be measured experimentation. and organizations and their staff held accountable for results. It has been a slow process, taking longer than imple- mentation of more traditional projects. The most Competitive pressure, on the other hand, is a mecha- successful attempts have been those in which insti- nism for setting standards that organizations and their tutional development has taken place over long periods, staff must meet. Competition is defined more broadly usually several decades, in the course of several than in traditional economics; in addition to external investment projects. competition from others, competitive pressures can be exerted on an organization by the political establish- In the case of highways, the main difficulties have been ment, regulatory agencies and road users, and by with maintenance because of its managerial and organi- managerial measures that create a competitive atmos- zational complexity. Institutions that were strong phere within the organization. initially progressed faster than weak ones, and agencies that were not fully convinced of the need tended not to Low specificity and a lack of competitive pressure are 168 Richard Robinson: Institutional Development in Road Maintenance Organizations often characteristics of a poorly functioning institution External pressures from the political establishment that has little accountability and low staff motivation. or regulatory bodies; Several steps can be taken to raise specificity: Internal competition among staff or units within an Objectives should be set in terms of output and institution. defined with as much precision as possible. The first surrogate involves beneficiaries who can take Time periods for meeting objectives should also be action to demand higher standards of performance. This closely defined. Longer time periods usually imply pressure can be exerted on the private sector, but is lower specificity and a greater likelihood that an particularly relevant for public sector agencies not activity will be affected by the vagaries of human exposed to the marketplace. In some countries, road behavior or political processes. federations with vested interests have acted as pressure groups on government road agencies. Where such Methods for achieving objectives can affect their groups are well organized, they can exert considerable specificity. Vaguely defined methods for which there influence. are only general standards imply that it will be difficult to measure performance and efficiency. The second surrogate, political pressure, emanates from government officials and regulatory agencies. If well Control of achievement is a result of the ability to directed, this type of pressure can have a positive effect specify objectives and methods, and thus vtrify aciie- on institutional performance. vement. It requires collecting data and information; controlling achievement is easier with high specificity Pressure from both beneficiaries and politicians in activities, the roads sub-sector has too often pushed for building more roads rather than for better maintenance. Attitudes Israel notes the relative lack of success of maintenance need to change so pressure can be targeted at the right and prevention programs in low specificity activities. areas. In many countries, there remains a need to mobi- The effects of poor maintenance and lack of preventive lize pressure on road organizations from both the works take a long time to materialize, and the conse- political and road-users sectors of the community. quences are sometimes difficult to link back to a speci- fic activity. In the short term, little happens. The lack Internal competition involves an entity's developing of an obvious impact is at the heart of the difficulty an organizational and management style that generates of promoting maintenance activities in developing coun- competition among its personnel and units for better tries. There are no inauguration ceremonies for good performance. The need to increase the specificity of maintenance. With respect to competition, the main activities is particularly relevant here. issue is the degree of monopolistic control exercised rather than public or private sector involvement in road The effectiveness of competition and its surrogates may works. Contract maintenance is only likely to perform be limited by cultural conditions. Competition increases more effectively than force account (direct labor works) the potential for conflict, which can raise difficult if a contractor is subject to competition. A parastatal situations for management. In societies in which colla- operating in a monopoly position has few more incen- boration and the avoidance of conflict are paramount, tives to perform than a government maintenance organi- introducing competitive measures can be counter- zation. It should be noted that the skills demanded for productive and the relevant factor may be collaboration maintenance department personnel will be very different rather than competition. Deciding where to keep old when carrying out maintenance in-house than when arrangements and where to instigate change is a managing maintenance by contract. difficult process that few societies have accomplished successfully. Cox (1987) has described how competition introduced into public sector maintenance organizations in the Competition works by threatening an organization and United Kingdom resulted in a dramatic increase in effi- forcing it to adapt in order to survive. Public sector ciency and effectiveness. While there are lessons to be enterprises do not, however, control many of their basic learned from this experience, there is also scope for policy parameters, so survival may depend on a change introducing surrogates for competition. Three types of in government policies. Often these policies are over- surrogates for competition can be identified: loaded with so many diverse objectives that none of them can be met efficiently. Governments will some- EATernal pressures by beneficiaries of the road times need to alter their policies if enterprises are to maintenance activity, normally road users; survive in a more competitive environment. 169 Richard Robinson: Institutional Development in Road Maintenance Organizations Organizational Change resistance to change is likely to be a difficult obstacle to overcome. Where maintenance procedures have evol- Three steps are needed to make the organizational ved over many years, staff are likely to see their chief changes necessary to increase accountability and problems as lack of resources rather than maintenance motivation to improve road maintenance institutions: management. Promotion is likely to depend on a obtaining government commitment; isolating and well-extended system of local loyalties which may well analyzing problems; and developing and implementing be stronger than headquarters policy. Many hundreds of action plans. staff are likely to be affected by any decision. Against this background, revision of maintenance procedures is Commitment likely to take a long time, during which political commitment and continuity will need to be maintained. Greater public awareness, including that of potential interest groups such as road haulers, exporters, and Analysis contractors, is important for shaping policy and mobi- lizing support for programs to restore and maintain A thorough understanding of an institution-how it roads. Political and private interests have often brought works, its strengths and weaknesses, efficiencies and pressure on road authorities to divert resources intended bottlenecks-is needed before it can be strengthened. A for road maintenance. This has led to maintenance first stcp must therefore be an institutional appraisal. organizations starved for finance and shunned by the Although there are some advantages to this being per- ablest civil servants, with the result that the formed internally, experience suggests that it is usually maintenance function suffers from neglect. more effective if management reviews are carried out by external consultants or an institution that can Those at high political levels must grasp both the introduce new ideas and experiences, and is freer to importance of maintenance and the necessity for the recommend the more difficult changes that would be a efficient use of resources. The consequences of road problem for insiders. neglect are a matter of public interest. Awareness should be created among the general public and poten- Institutional appraisal is difficult. Political and cultural tial interest groups. This should be focused on not only issues will be important, and the way an institution the bus and haulage companies, but also on business works in practice may not be what is said formally and more generally, including potential vendors of road is often obscure to the outsider. It will be essential to maintenance supplies or services, in the hope of stimu- work closely with the institution concerned and those to lating a coalition of interests to influence public which it is responsible. It will also often be necessary policy. to draw on specialist advice. Governments can also foster interest in the road An approach to institutional appraisal has been provided maintenance problem and the need for institutional by the British Overseas Development Administration development by encouraging the formation and func- (ODA), which has developed a series of checklists for tioning of professional associations of highway engi- institutional appraisal, financial management capability, neers. Such professional institutions often include and manpower planning. The ODA institutional influential senior government officials and can influence appraisal checklist covers both the institution itself and the formulation and execution of policy. The Institution the environment in which it operates. of Highways and Transportation in the United Kingdom is endeavouring to build institutional links with similar The Transport and Road Research Laboratory has bodies overseas. developed a checklist specifically for assessing road maintenance organizations in terms of their "institu- Political and cultural considerations can prevent pressu- tional", "managerial" and "technical" capabilities. res generated in the private sector from being taken up The interdependence of these aspects can be better by governments. For an action plan to have a chance of understood if these terms are defined. success, there must be a combination of political and public pressure for reform. Unless ways can be found Legal/institutional capability: Developed economies to combine these pressures and internalize them within have legal frameworks that clearly define the responsi- the government it is unlikely that progress will be bilities of government ministers and their departments. made. Thus, where cultural constraints exist, committed This is not always the case in developing countries, politicians will need to find ways of fostering interest with the result that considerable reliance may be placed groups and raising awareness of needs within govern- on a senior office-holder's interpretation of his powers ment circles. and responsibilities, and changes in senior staff may result in new interpretations and lead to confusion and Even with strong public and political commitment to lack of commitment amongst middle and junior mana- tackle the problems of institutional development, gement. It is fundamental to the establishment of an 170 Richard Robinson: Institutional Development in Road Maintenance Organizations efficient highway maintenance department to have in one area cannot be achieved without complementary statutes that define the department's responsibilities capability in the others. Each element must be in place clearly and provide for: in the road maintenance organization if improvements are to be sustainable. It may be that too much attention * legal powers to undertake maintenance; has been paid in the past to improvements in technical capability without first ensuring the institutional * rational and functional administrative structure; and managerial competence to support it. In many countries, straightforward and relatively short-term * the employment and training of staff; assistance to upgrade technical capability may be appropriate, but only if institutional and managerial * funds to undertake maintenance and for performance is sufficient. administration, salaries and expenses; It seems likely that improvements at the institutional * financial control. level are prerequisites to improving management and technical capabilities. Checklist results tend to support Managerial capability: Management must concen- this hypothesis, since most of the road maintenance trate on efficient use of human and physical resources organizations that have been evaluated failed to achieve with a clear understanding of the role of the department a high enough institutional score to provide the basis and its goals. Managerial capabilities require: for investing in managerial and technical improvements, Thus, a hierarchy exists in that sufficient institutional * up-to-date inventory; capability is required to support and sustain managerial capability which, in turn, is a precondition for sustained * works effectively planned, programmed and moni- improvements in technical competence. tored; The checklist is subjective and responses to it refer only * budget related to actual costs and ability to to a particular point in time. However, it is believed disburse; that such a checklist can greatly assist in defining the areas of an organization that are deficient, and ensuring * effective cost control; that institutional development efforts in the maintenance sector have the highest chance of success in the longer * adequate plant and equipment that are effectively term. utilized; Action Plans for Institutional Reform * availability of materials as required. Once the needs of the organization have been identified Technical capability: Without technical resources, through an institutional appraisal, the next step is the an institutional framework and management expertise development of action plans, and their implementation are of limited value. Sufficient numbers of competent and monitoring. Data collection and analysis must form staff at all levels are required by any organization. Lack an integral part of each of these tasks. of competence, at any level, will affect efficiency, but it is particularly important at the lower levels of A well-defined action plan should be realistic and responsibility for plant operators, technicians, mecha- achievable, have a series of targets related to different nics and laborers. The technical capability requirements stages and times, and be monitorable and monitored. for efficient maintenance management are: Most components of an action plan will address issues * appropriate criteria for planning; internal to the organization, but some will need to address external factors. Addressing external factors is * materials test facilities; likely to prove more difficult and to take longer, but these should be tackled in parallel. * effective quality control of all operations; The internal factors to be considered include organi- implemented pavement assessment and monitoring zational structure, policy and decision making patterns, systems; procedural factors, physical resources, and information systems. The external factors to be considered include * access to research and information. both economic and socio-political issues. The checklist demonstrates the interdependence between Strengths and weaknesses in these areas should be institutional, managerial and technical capabilities. For identified through the institutional appraisal which an organization to be effective, satisfactory performance should rank issues by importance. The institutional- 171 Richard Robinson: Institutional Development in Road Maintenance Organizations managerial-technical hierarchy between issues should be Staffing recognized as this will lead to a logical sequencing. In some countries, government organizations have, in The institutional appraisal will investigate aspects of the essence, become agencies for employment relief. Large, organization such as responsibility, authority, duty, and relatively untrained labor forces have been allowed to delegation as well as its specificity and use of competi- develop with the result that available funds can only tion surrogates. It will comment on whether the organi- cover the cost of salaries with little remaining for the zational form is appropriate to the tasks that need to be materials, fuel and other resources necessary to carry carried out, taking account of the socio-political out works. Civil service rules circumscribe managerial environment in which it is operating. Action will be decisions and national employment objectives can needed to implement any changes in the organizational smother the authority's technical work and distort its structure resulting from the institutional appraisal. operations. This results in a workforce that has little motivation. Attempts should be made to address this The institutional structure should be designed to issue by modifying government policy on civil service increase specificity and make the best use of resources. employment to enable reductions in the size of the Formal criteria need to be established for allocating unskilled workforce with more emphasis on the devel- resources within the organization. opment of skilled labor. A number of weaknesses common to Sub-Saharan Afri- Shortages of technical staff and inadequate skills should can road maintenance organizations could be the focus be recognized and reflected in the organizational struc- of action plans. Among economic issues, resource ture. Rather than use well qualified staff on a cons- shortages suggest that many regional countries should truction site when there is a lack of skilled staff in the adopt policies geared to better utilization of existing maintenance department, it might be better to use high facilities and to the more effective provision of quality staff for maintenance planning and management maintenance services. This should be done through activities and hire consultants to supervise construction more cost-effective resource allocation, reduction in works. Using staff in this way recognizes that it is overstaffing, and improvement in the management of cost-effective to delegate responsibility for relatively maintenance organizations. short-term and geographically isolated tasks such as contract supervision. Such situations must be recognized Resource Allocation by decision makers and formal modifications made to organizational structures to reflect optimal solutions. Economic analysis should be the basis for allocating resources between new investments and maintenance Institutional Management but decision criteria should take into account social and other national priorities. In most cases, maintenance In a highway maintenance organization with a pyrami- activities will have the highest economic returns and the dal management structure, successful operation is bulk of available resources should be allocated to main- utterly dependent on instructions being passed down the tenance. line and sensibly interpreted at each level. A disci- plinary system usually exists to back up orders, but this Given the size of existing road networks and the lack of is normally only used as a last resort. In a Western resources, it is unlikely that many countries in the maintenance organization, the knowledge that discipli- region will be in a position to maintain the whole of nary measures can be invoked provides an incentive for their road networks. Each country should establish a operational efficiency, coupled with the more positive core network that it can afford to maintain under the incentive of promotion based on good performance. If national budget and set up a program to increase the traditional or cultural considerations make incentives size of this network gradually as financing improves. and sanctions ineffective, management efficiency is severely impaired. Each country should develop a sector transport plan of projects for which it would require donor assistance. In practice, conditions on the ground are such that Funding should then be sought from donors for these excuses can frequently be found for inefficiency that projects and pressure from donors for other projects tend to obscure the basic problems of management. No should be resisted, even where funding is offered on a attempt to deal with problems will be really successful grant basis. External financiers should be more sympa- unless it takes full account of these traditional behavior thetic than previously to such an approach and should limitations. Formal, objective and systematic staff be more prepared to fund maintenance and rehabilita- assessment is the only real means of showing to an tion, and to employ local contractors for such activities. individual and his superiors that he is worthy of promo- Attempts by donors to set up special facilities for their tion. Without this competition surrogate, nepotism and projects should be resisted because of the distortions favoritism could well be perpetuated to the detriment of such activities cause. staff morale and efficiency. 172 Richard Robinson: Institutional Development in Road Maintenance Organizations A maintenance organization should have clearly defined norms. There is scope for improving the management policy objectives. These should be specified in output of equipment by considering issues of specificity and terms so it is possible to measure achievement against competition. them. Objectives can be stated in terms of the maxi- mum or mean levels of road roughness allowed, or in An increased level of specificity can be introduced by terms of the percentage of the network that should be managing equipment through a departmental plant hire resealed or regravelled each year, or in terms of how scheme. By compelling explicit accounting of costs, measured road conditions are planned either to improve such schemes inculcate greater cost consciousness and or stabilize over time. Such well defined objectives generate pressures within government for efficient increase the specificity of the organization and provide utilization of plant and vehicles, helping to control a target, which should be the starting point for all diversion and curtail excess and unaffordable invest- planning and management activities within the organi- ment. By making the finances of plant hire organi- zation. Considerable thought should be given to formu- zations dependent on revenues generated from plant lating these in ways that are both meaningful and hiring, strong incentives can be generated to keep plants achievable. in operation, since a broken-down plant generates no revenues. Spare parts can also be replenished regularly Decisions within the maintenance authority should be and equipment replaced out of revenues generated. based on rational criteria that are documented, well known and understood by all managerial and opera- If such a scheme is to work well, the public adminis- tional staff. Criteria should reflect the policy objectives tration must resist pressures from equipment users to of the organization. In addition, criteria should be understate costs and ensure that bills are paid. If not, framed so resources are utilized in the most cost- funds generated will be neither adequate nor available effective way and with the object of increasing on a timely basis, and the true costs of equipment will accountability and motivation by addressing the issues remain hidden. of specificity and competition. The formulation of decision criteria, like objectives, should be a conscious Competition can be introduced by allowing the auto- and rational action. nomous equipment department to compete on equal terms with plant hire companies in the private sector. Decentralizing the organization of road maintenance has Such an approach needs careful accounting and audit to often been advocated as a first step in reform. Decen- ensure that there are no hidden subsidies. A further tralization is seen as a way to make the road mainte- approach is to turn entirely to the private sector nance authority more responsive to local needs and and/or to privatize the equipment maintenance function reduce the difficulties of managing activities that are completely. geographically dispersed. The re-emergence of length- men for undertaking maintenance on unpaved roads in Maintenance Execution several African countries has come about in direct recognition of this. However, in organizations that are The effectiveness of maintenance can also be enhanced managerially weak, decentralization imposes additional by introducing competition into execution operations, managerial and technical burdens that may prove diffi- either by allowing a public sector maintenance enter- cult to support. Case-by-case experimentation in this prise to compete with the private sector, or by complete area is recommended to determine which organizational privatization. Creating a separate maintenance enterprise form is most appropriate. that still enjoys a monopoly position is unlikely to provide the full advantages, although efficiency and The level of specificity can be increased by separating effectiveness are still likely to be increased because of the planning and control functions of road maintenance the higher degree of specificity. from that for works execution. By limiting demands on these management functions, the road authority is less The possibility of contracting a major part of routine as likely to be overwhelmed with executional priorities, well as all periodic maintenance should be considered, and accountability can be strengthened. The experience but care must be exercised to ensure that the public of the United Kingdom is particularly relevant in this monopoly is not replaced by a new cartel of private context. The separation of maintenance functions can be interests as has happened in some countries. Careful achieved in three areas-equipment management, main- planning and introduction of contracts on a small trial tenance execution, and maintenance management. basis can reduce risks, permitting the government and contractors to develop capabilities before putting too Equipment Management heavy a burden on a new system. Successful contracting schemes have involved close coordination between Equipment is one of the most costly resources in road governments and contractors in defining the work to be maintenance, yet availability and utilization are done and in planning the work program. A further extremely low, often no more than half of reasonable advantage is that when contractors become involved in 173 Richard Robinson: Institutional Development in Road Maintenance Organizations maintenance, their lobbying efforts can increase budgets assistance in the institutions of government in setting for road maintenance. policies and supervising maintenance activities. In principle, there is no reason why the planning and The changing form of development efforts in Africa control functions of maintenance operations cannot be over the last 10-15 years has implications for the type subject to competition in a similar way to the execution of external expertise required. Through the mid-1970s, of maintenance. Although there is limited experience development was essentially the preparation and imple- with this in developing countries, its adoption for mentation of development projects, and much of the certain maintenance works in Britain has led to a assistance required for these tasks came from engi- 15% reduction in management costs. The work involves neering and other technical consultants. Although the routine, periodic and emergency maintenance and problems faced were often technically complex, the includes surveillance, inspections, investigations, nature of the consultants tasks was relatively easy determination of priorities, and the supervision of all to define and outputs were tangible. Performance work on the network. Contracts were placed with was clearly measurable, though its monitoring was consultants, after competitive bids, for a five-year term. often weak. Many members of the existing maintenance workforce The development focus over the past years has been transferred to the consultant's staff upon the award of shifting to the strengthening of institutions, the contracts, so this approach provided competition and management of technological and social change, and the increased levels of specificity without significant job study and implementation of policy reform. These new losses. There is believed to be considerable scope for directions have important consequences for the way a this approach to maintenance management in develop- country manages technical assistance, for the nature of ing countries, and its use is recommended, at least on the relationships to be established, and for the types of a trial basis. expertise required. Without physical resources, very little maintenance can Effective use of technical assistance in the past has take place. Some resources rely on foreign currency; sometimes been hampered by inherited institutional others are dependent purely on local currency, and it is systems that retained in top positions generalists who important for decision-makers to be aware of these did not always appreciate technical requirements and differences when determining policy and formulating were sometimes a barrier between technical specialists plans. Awareness of resource limitations can be taken and decision-makers. Technical assistance has also into account by formulating plans that minimize the use acquired a bad image; the pay scales of expatriates are of resources that are likely to be scarce. common knowledge and national civil servants are unwilling to accept the large discrepancies in salaries In many road maintenance organizations there is a and fringe benefits. Ways must be found to provide shortage of transport, either because of a lack of incentives for local counterparts, such as providing vehicles or because of a lack of fuel or vehicle repairs opportunities for secondment to equivalent organizations -which in turn, is often caused by an absence of spare abroad or regrading staff. parts. The effects of transport shortages can often be mitigated to a large extent by adopting a decentralized The use of counterparts has been an issue in imple- policy that minimizes transport distances. The use of menting technical assistance programs. Assignment of maintenance camps and lengthnen becomes very appro- good counterparts to work with consultants is vital for priate in this context success; however, it has been difficult to find or to attract counterparts with the right experience and Endemic shortages of bitumen may mean that, for some commitment. Often counterparts are assigned only a roads of lesser importance, it is appropriate to rip up few weeks before the end of an assignment. When suit- badly deteriorated paved surfaces and return them to a able and sufficient counterparts cannot be found, gravel surface to allow them to be maintained. Simi- experts in advisory positions with responsibility for larly, shortages of gravel may indicate that some roads on-the-job training end up as doers rather than trainers. should revert to an earth surface. In both cases, limited There seems to be merit, therefore, in viewing the physical resources should be targeted on the more expert as the counterpart of the local staff, rather than important roads. This should be the result of a policy the reverse. Another approach used by some countries decision rather than something that happens by default. is to let consultants take part in the selection of nationals working with them. Technical Assistance Most countries in the region have reached a mature It is likely that technical assistance will be needed at stage in the use of technical assistance, and are using it some stage. Even if execution or management is carried selectively and far more effectively. Governments, out by contract, there is still likely to be the need for therefore, should not be discouraged by the failures and 174 Richard Robinson: Institutional Development in Road Maintenance Organizations the bad image of earlier times. However, it is probably setting up a twinning agreement and working together not wise to go too fast with the replacement of expa- to carry it out. triate personnel. Young professionals with only two or three years experience should not be expected to move Experience with twinning suggests that there is more straight into managerial positions. scope for its use than has been taken advantage of in the past. A tripartite arrangement between a host Sometimes, it may be best to use technical assistance in organization and an offshore institution in conjunction executive rather than advisory positions since this with a consultant seems to offer the best combination of increases the level of specificity. In the traditional skills and resources for solving institutional problems advisory role, the technical assistance officer has only and assisting with development. Any twinning arrange- indirect responsibilities for measurable outputs, very ment considered should follow closely the guidelines set limited risks and, at best, limited incentives for out in World Bank Technical Paper No. 23. improving performance. To provide performance incen- tives, the role of the technical assistance officer needs Monitoring changing to better apportion the risks between providers of technical assistance and government clients. Tradi- Any action plan should be both monitorable and moni- tional sources of technical assistance are often not well tored. Well-defined, output-oriented objectives need to structured financially to accept significant risks. There be set at the outset and achievement at specific time may therefore be scope for looking at other sources of periods measured against these objectives. There is road maintenance assistance, such as international civil some advantage to carrying out monitoring by an engineering contracting companies. Such companies independent body. The other purpose of monitoring is usually have staff with appropriate experience and to identify areas where changes may need to be made, qualifications, and are accustomed to working as both to the objectives to the methods being followed. management teams in developing countries. Construct- However carefully an action plan is formulated, lessons ion companies are accustomed to risk-taking and will be learned factors to be reflected in a modified providing performance-related incentives. plan. If institutional development is to be successful, a Monitoring the performance of road authorities is change of emphasis is needed to make technical essential for those who are to be held accountable for assistance the main focus of projects, rather than an maintenance as it is for the audit of their performance. ancillary item. Such an approach is likely to be a However, it has proved extremely difficult to collect the natural outcome of institutional appraisals, but will need basic data that enables this to be done. The 1985 and a change in perspective by both African governments 1988, World Bank surveys of African roads indicated and international aid donors. that critical management data are generally not available, and where available are inconsistent or, in The twinning of institutions in developing countries many cases, incorrect. with similar, but more mature, organizations in other parts of the world has proven an effective way to If effective maintenance strategies are to be devised, transfer knowledge, train staff, and build management program planning, control and monitoring need to be capabilities. Professional relationships between strengthened at all levels. The key to effective operating entities offer advantages of being comple- maintenance is to anticipate needs and this is not mentary and are flexible over time. The entity supply- feasible without a system of regular inspections of ing technical assistance uses its own resources to offer pavement conditions. Many planning tools are available, services to its twin in the functional areas in which they but their use must be adapted to specific country condi- both work. tions. Information is required on inventory, condition and traffic, and these data must be collected in a Twinning arrangements in the highway maintenance systematic way. The data volumes involved point field have been carried out between the US Bureau of towards computers as being an appropriate medium for Public Roads and authorities in Ethiopia and, more their storage, manipulation and retrieval, but experience recently, between Staffordshire County Council from with large-scale, computer-based management systems the United Kingdom and Accra City Council in Ghana. in developing countries has not been encouraging. Where twinning arrangements have been successful, there has always been an initial commitment and con- Whether maintenance management systems are intro- sensus on the goals of the technical assistance. It is duced by management contractors or by the public important to recognize that twinning used alone may sector maintenance authority, it is recommended that an not be enough and that other types of technical assis- incremental approach to implementation be adopted, tance may be needed, and that entities are not neces- probably over a period of several years. Guidance to sarily compatible simply because they are in the same doing this is given in Overseas Road Note 1 (TRRL business. Both client and supplier may need help in Overseas Unit 1987). One approach is to concentrate 175 Richard Robinson: Institutional Development in Road Maintenance Organizations data collection activities solely on the sections of road Addressing the problem: this requires development that carry the largest volumes of traffic since it is here of action plans and implementing them by addressing that most benefits will be obtained. Another approach specific policy issues and recognizing external and is to start by defining and referencing the road network, internal factors; priority tasks should be identified for and providing a simple system for recording and storing tackling in an incremental approach that considers the this information. This can be followed by the collection following areas: of itemized inventory information and this, in turn, followed by the introduction of simple visual inspection * economic issues: better utilization of existing methods. By proceeding step-by-step in this way, it can facilities, economics-based resource allocation, be ensured that one stage is working reasonably well, identification of priority network, development and that accurate and reliable data are being obtained of transport sector plans and a more positive before moving on to the next stage. These approaches approach to dealing with donors; stand more chance of success than the rapid introduc- tion of full scale management systems which have been * socio-political issues: resistance to change, tried in the past. employment policy, cultural constraints and the need for objective staff assessment; Conclusion organizational structure: organizational form, formal criteria for allocating resources, centralized or For African governments to address the problems of decentralized organization, separating functions for institutional development, the following steps are equipment management, maintenance execution and needed to obtain success: maintenance management; Obtaining government commitment: there is a need * procedural factors: setting policy objectives, for strong political leadership and to foster interest determining criteria for decision making; groups and to internalize their effects within the government * physical resources: foreign exchange effects, short- ages of transport and maintenance materials; Obtaining a full understanding of the problem: * formulating projects in terms of institutional devel- this should be done by carrying out an institutional opment rather than physical execution of works; appraisal that collects data and takes cultural issues into account. * monitoring achievement. 176 Richard Robinson: Institutional Development in Road Maintenance Organizations References BODDY, J.E., 1988. Motorway and trunk road management by consulting engineers and the use of term maintenance contracts. In: INSTITUTION OF HIGHWAYS AND TRANSPORTATION. National Workshop on Reconstructingfor Tomorrow's Traffic, Leamington Spa Englan4 26 April 1988. London: Institution of Highways and Transportation, 121-147. COOPER, L, 1984. The twinning of institutions: its use as a technical assistance delivery system. World Bank Technical Paper No 23. Washington DC: The World Bank. COX, B.E., 1987. Evaluation of incentives for efficiency in road maintenance organisation: the UK experience. Transportation Issues Series Report No. TRP4. Washington DC: The World Bank. HANDY, C.B., 1985. Understanding organisations. Harmondsworth: Penguin Business Library, Third edition. HARRAL, C., 1987. Organisation and management of road maintenance in developing countries. Transportation Research Record 1128. Washington DC: Transportation Research Board, National Research Council, 36-41. HARRAL, C.G. and J.W. EATON, 1986. Improving equipment management in highway authorities in developing countries. Transportation Issues Series Report No TRP2. Washington DC: The World Bank. HARRAL, C.G., et al, 1986. An appraisal of highway maintenance by contract in developing countries. Transportation Issues Series Report No TRP1. Washington DC: The World Bank. ISRAEL, A., 1987. Institutional development: incentives to performance. Baltimore: Johns Hopkins University Press for The World Bank. LEVY, H. and P.O. MALONE, 1988. Transport policy issues in Sub-Saharan Africa: report on a series of Roundtables held in Rome, April 1-18, 1986. EDI Policy Seminar Report No . Washington DC: The World Bank MASON, M., 1985. Road Maintenance survey for West and Central African countries. In: CIDA et al. Senior Management Seminar on Planning, Financing and Managing Cost-Effective Road Maintenance Programs, Abidjan, June 1985. Washington DC: The World Bank OVERSEAS DEVELOPMENT ADMINISTRATION, 1988. Appraisal of projects in developing countries: a guide for economists. London: Her Majesty*s Stationery Office. ROBINSON, R., 1987. A perspective on road maintenance and deterioration in Africa. In: UNECA. Fourth African Highway Maintenance Conference, Harare, 7-11 December 1987. Addis Ababa: United National Economic Commission for Africa. ROBINSON, R. al, 1985. The road maintenance crisis in Africa: an agenda for action. In: CIDA et al. Senior Management Seminar on Planning, Financing and Managing Cost-Effective Road Maintenance Programs, Abidjan, June 1985. Washington DC: The World Bank ROBINSON, R. e, 1987. Road maintenance projects: reassessing objectives. In: UNECA. Fourth African Highway Maintenance Conference, Harare, 7-11 December 1987. Addis Ababa: United Nations Economic Commission for Africa. TRRL OVERSEAS UNIT, 1987. Maintenance management for district engineers. Overseas Road Note 1. Crowthorne: Transport and Road Research Laboratory, 2nd Edition. WORLD BANK, 1981. The road maintenance problem and international assistance. Washington DC: The World Bank. WORLD BANK, 1988. Road deterioration in developing countries: causes and remedies. A World Bank Policy Study. Washington DC: The World Bank. 177 Cohnt Relf and Sydney Thriscutt Human Resources Development and Management Background terate. At the secondary level, average enrollment was 3 % compared with 14 % and 2 1% respectively in Latin Massive road investments to link cities, ports, industrial America and Asia. Only one in a thousand went on to and rural areas have greatly outstripped Sub-Saharan enroll in tertiary education, compared with more than Africa's ability to provide the trained manpower needed 30 times this rate in other parts of the developing to maintain and repair them. world. There have been significant changes since independence, and literacy is approaching 50%. Primary Road maintenance has been only one of many claimants enrollment in 1985 was 75%, secondary 23%, and on the region's overstressed education and training between one and two% progressed to tertiary education, facilities. When these countries gained independence but these figures are still well below those for industrial beginning in the 1950s, trained indigenous manpower countries, where almost 40% receive tertiary education. was virtually non-existent. In Malawi in 1964, for example, there were only 29 African university gradua- Despite these advances, specialized personnel remain in tes, none of them in engineering. When Botswana woefully short supply. It is generally agreed that a became independent, 96% of higher level posts in the minimum of about 30 graduate-level engineers and country were filled by expatriates, and non-Africans scientists per 10,000 people are needed to service a occupied all posts requiring a university degree in modern economy. In most Sub-Saharan African coun- Tanzania in 1962. tries, the proportion is less than a third of this number. By this standard, the estimated 10,000 suitable engi- In most African countries, the grace period for transi- neers and scientists being produced each year by the tion was short. Some were reluctant to accept a lengthy region are not even enough to keep up with annual transition for the replacement of expatriate senior, population growth of some 13 million. middle-level and supervisory staff by local personnel. In others, the rapid and complete departure of the In spite of the progress made and its increasing cost to colonial powers gave little choice but to place untrained local economies the education gap between the Sub- and largely inexperienced national staff into responsible Saharan countries and those of the industrialized world posts without delay. is large and increasing. In 1960, the industrialized countries spent 14 times more per student than the The burden of training replacements for the departed poorer developing countries. By 1980, this figure was expatriates fell on education systems that were often 50 times more. With this worsening situation, it is rudimentary. Only 36% of the region's children were essential that education and training in the Sub-Saharan receiving primary education in 1960, compared with Africa region is planned to provide only essential and 73 % in Latin America and 67% in Asia, and more than urgently needed skills; that the quality of instruction is 90% of the Sub-Saharan African population was illi- the very best possible with the resources available; and that costs per person trained are kept to a minimum. The need is not so much for more education, but for more relevant education designed carefully to meet the specific manpower requirements of the region. The improvements attained over the past few decades are now threatened by steeply rising costs for secondary Coli Rel isa cosulant iththe irmand tertiary education and specialist training. Failing per CohTn spaostant ithds te, U.K capita GDPs over the past few years have only accen- IT raspotnOxdsl,U. tuated this problem. In tertiary education, average Sydney Thriscutt is a consultant for annual costs per student in the region are about eight the World Bank based In Sussex, U.K. times the average per capita income, as compared with only about 90% of per capita income in Asia and 70% The paper Is edited and adapted by the SSAT11 from an in Latin America. Countries with small or widely scat- original text submitted by the, authors tered populations face additional difficulties, as tertiary training institutions are often uneconornically small and 0 1989, SSATP - World Bank/ECA it is not possible to have the wide range of specialist ______________________________ training institutions that are needed. 178 Colin Relf & Sydney Thriscutt: Human Resources Development and Management The Development of Human Resources the region is not merely the provision of education, but provision of the type of education appropriate to the The need for more education and training in Sub- needs of the society and the economy. Providing Saharan Africa is universally accepted. Training education which does not lead on to suitable is, however, frequently regarded as synonymous with employment is a recipe for frustration and unrest, as human resource development, and insufficient attention well as being a waste of scarce resources. The is paid to establishing a framework of priorities to education systems in many regional countries are assure that training is cost-effective and result-oriented. unsuitable, at least to some extent, to the pattern of This means that too little attention may be given to their economic development. It will now be difficult to manpower analysis before training is planned, or to reorient the expectations of those who have passed manpower management after training has been comple- through these systems towards the type of employment ted. Insufficient analysis of manpower resources and opportunities that do exist. needs carries the risk that the wrong type of training may be given, or that people are trained for jobs that Road maintenance requires a range of very specialized are of low priority or do not exist. Poor manpower technical skills at the lower- and middle-management management means that trained staff are unable to levels, while higher management also needs well devel- apply what they have learned effectively, and their oped managerial skills. These specialized managerial training is wasted. skills are not taught at most African colleges. The need for specialized regional centers to provide these skills Manpower analysis and planning is an essential first has been recognized through the establishment of such step toward developing the supply of human resources institutions as the Eastern and Southern African Mana- needed for effective road maintenance programs. While gement Institute (ESAMI) in Arusha, or the Regional national manpower planning, apart from being expen- Management School for the West African Economic sive and difficult to organize quickly, often results in Community (CESAG). Institutions such as these have insufficiently detailed data, sectoral analysis often a great potential for tackling more effectively than produces accurate and practical results that can be used training centers outside of Africa some of the critical to identify potential skill shortages and imbalances that human resource constraints of Sub-Saharan Africa. hinder the achievement of sector goals. These analyses These institutions face, however, the difficult twin tasks can also identify priorities for training programs and of keeping up to date with worldwide developments in suggest possible institutional changes. By taking a management training and adapting these to the parti- sector-wide approach to training, programs can be cular needs of their African students. Donors can help developed to meet the specific needs of the sector, and in this process by giving relatively inexpensive assis- are thus likely to be more cost effective than general- tance in the shape of short-term consultancies, technical ized educational and training programs. A promising publications, teaching aids, testing and survey equip- approach has been taken by the World Bank in Ghana, ment, and, perhaps most importantly, advice on-and where local organizations active in the sector have been training in-new methodologies. enlisted to collect data that is compiled and analyzed centrally for a sector survey. Road maintenance staff often need highly specialized short-term training that can be most cost-effectively National education systems are not, and should not be, delivered by bringing trainers to their clients. Travelling programmed solely to meet the needs of the roads instructors can be used to present highly specific short sector. The appropriateness of curricula to developing courses to relatively small and specialized groups in the basic practical skills needed by roads and other individual countries or regions. This method of training productive sectors should, however, be a national has the advantages that course content, length, and the educational priority in countries with severely limited number of instructors can be varied to suit specific resources to spend on education. The results of sectoral needs, travel and subsistence costs are lower, and staff manpower needs analysis should be made available to are away from their normal duties for a shorter time, if education planners to assist in establishing those at all. Overall, the costs per trainee are less for travel- curricula. ling courses, and course material can be made very country specific. There is often an added advantage in Despite the fact that significant advances have been that trainers brought to the field receive significant made in primary education, it is open to question feedback from clients that can help to adapt training to whether the type of education given even at this early working level needs. stage is entirely appropriate. The whole bias of general education at all levels has been towards academic quali- To organize this type of very specific and concentrated fications. This produces expectations for types of training in the best way, the duties of the staff to be employment that do not exist in sufficient quantity, trained need to be analyzed to ensure that all essential while there is a great need for other types of skills. work is covered, and the minimum of unnecessary ma- A fundamental issue which affects all development in terial is included. As an example of the scale of savings 179 Colin Relf & Sydney Thriscutt: Human Resources Development and Management that this approach can produce, in training large In some cases, these situations result from institutions numbers of construction workers in one Asian country, designed and set up according to non-African ideas. If it was found that basic skills sufficient to train for over the precepts on which an institution has been designed three quarters of normal work requirements could be to operate do not accord with the accepted ideas of the imparted by using less than 20% of conventional course society in which it operates, it is unlikely that very material. As a result, training which had previously efficient functioning will result. Where roads organi- taken two years was completed in ten weeks to the zations are operating reasonably well in Sub-Saharan stage where the majority of construction work could be Africa, it is likely there has been some accommodation tackled competently. Training in higher skills for more of one to the other. advanced work was then provided by further short cour- ses after a year or two of employment with on-the-job For the foreseeable future, regional countries will have training. to continue to make significant use of consultants to provide expertise not available within their own organi- Much has been written on the subject of loss of trained zations. The achievement record of consultants, and staff, particularly as it affects government. While this technical assistance generally, in Sub-Saharan Africa is loss is undoubtedly an annoyance and an inconvenience mixed. Where consulting firms have been used on spe- to an employer who provides training, it is not necessa- cific and well defined projects, results have usually rily a loss to the country as a whole. If trained staff been satisfactory, but where the aim has been to build move from government to the private sector where institutional capability by technology transfer, there conditions are better-as is very commonly the case- have often been doubts as to whether consultancies the training provided by the government will eventually were cost-effective. The problem seems to arise in these improve the capabilities of the private sector. In this cases from a failure to define exactly what is required case, and unless the conditions offered can be matched from a consultancy, with target outputs and timing left by the government, the best course may be for the vaguely defined, and a subsequent lack of monitoring government to make the maximum use of the private to make sure that specified objectives have been sector, thus reducing its own need for trained staff. reached. The solution is to spell out in the terms of Direct government investment in private sector training reference for assignments, exactly what is expected in may even be warranted in countries in which a stronger terms of institutional development and staff skill private sector offers the possibility of efficiency gains, improvement, as defined by a manpower and institu- reducing public sector management burdens, or provi- tional analysis. It should also be made clear that ding competition that will increase public sector continuation of assignment depends on targets being effectiveness. met on time. These comments apply to both consulting firms and individuals provided under technical assis- Manpower Management tance agreements, although enforcement is more diffi- cult with the latter. For their part, donors could well Trained manpower is a scarce and expensive resource cooperate to see that the technical assistance they that must be used sparingly and efficiently. Well provide is well planned to give what is needed without designed and well managed institutions are necessary to overlap or gaps. It has been the practice to assign attain this goal; staff skills must be used to the counterparts to work with consultants to encourage the maximum, and staff must feel they are making a real transfer of knowledge. Although sound in theory, this contribution to the efficiency of the operation. In some idea often achieves little, and there have been faults on Sub-Saharan countries, the roads authorities have made both sides. On-the-job training, of which this is one significant progress towards such a happy state of type, takes time and energy on the part of a consultant, affairs-often in spite of very limited resources and who needs to have a genuine desire to develop his continual outside interference in technical operations. counterpart. The qualities necessary to instruct are not By contrast, in the roads authorities of other regional the same as those needed to design, advise or supervise, countries, one finds senior technical management invol- for which the consultant is generally chosen. Counter- ved in every minor decision so that they are unable to part training should be regarded as the primary objec- give time to policy matters, middle management doing tive of the consultants' assignment, and not as a largely clerical and administrative work while work subsidiary part-time activity. planning andsupervision remains undone, and junior staff often idle because the necessary planning, On the part of the government, counterparts are often transport, materials, tools and equipment are not assigned late, or only temporarily, to consultants, and available. Morale is low and there is neither incentive they may not be suitable for the type of training given for good performance nor disincentive against bad or for the post they may later hold. To be effective, the performance. Not surprisingly, productivity is abysmally counterpart should be assigned throughout the low under these conditions. consultancy period, and must have the knowledge and 180 Colin Relf & Sydney Thriscutt: Human Resources Development and Management capability to develop to the required level. There must to long term, lead to significant overall savings in terms be incentives for development, and counterparts should of more appropriate and cost-effective training. be able to see that they will eventually be engaged in the position for which they are being trained, and will Road maintenance organizations and other operating be able to apply the expertise they have acquired. Best departments should make information on manpower results are likely if, as quickly as possible, the roles needs available to national education planners and seek of consultant and counterpart are exchanged, with the an advisory voice in the design and priorities of consultant filling a largely advisory position. curricula at all levels. Without some form of transfer of knowledge, aid Greater attention should be paid to the training of projects have proved to be of limited and temporary trainers themselves. "Twinning" could happen between benefit. The process needs to continue for a good many industrial country management institutions and such years, but most consultancy assignments are too short organizations as ESAMI and CESAG. for this. Twinning between similar institutions in different countries overcomes this problem, as the CESAG and ESAMI should consider establishing train- contact can continue for as long as felt desirable, and ing teams capable of delivering short and highly costs are low. As with counterpart training, there needs specific courses on site in regional countries. Donor to be a real commitment on both sides of the ideal of organizations should assist in this exercise. effective technology transfer. As well as the two insti- tutions matching, individual positions and their holders National manpower planners should examine the possi- should be matched. To be effective, the individuals bility of providing training to private-sector road directly in contact need to build up a degree of empathy maintenance organizations and contracting firms. over the years so that either party can feel free to make direct contact over day-to-day problems, with the Caution should be taken not to impose inappropriate assurance that there will be an immediate and useful imported management systems on African institutions. response. Systems that have worked elsewhere in the region are more likely to be successful, but any system adopted should be tailored to accord with local conditions. Recommendations Consideration should be given to providing consultants Road maintenance organizations, transport ministries, and consulting firms themselves with training in skills and external donors should recognize the need for transfer techniques. Twinning between kindred organi- increased analysis of sectoral manpower needs and that zations should be explored as a means of developing devoting resources to such analysis may, in the medium longer-term skills transfers. 181 Topic C: Case Study Assessment of Maintenance Capability Introduction It is, therefore, crucial that terms of reference for road maintenance projects be based on a detailed assessment The World Bank policy on road deterioration in devel- of maintenance capability to ensure that key issues are oping countries states that "developing countries have addressed. This, in turn, requires that the institutional lost precious infrastructure worth billions of dollars situation is analyzed in far more depth than would be through the deterioration of their roads". It also necessary for a construction or rehabilitation project. comments that "the inadequacies of road maintenance The result of such an analysis should indicate where stem in part from the structure and functions of the external assistance is most likely to promote permanent traditional road agency." change and avoid the application of palliatives to pro- blems which are a symptom of institutional and mana- Projects for addressing deficiencies in the functions gerial faults rather than the cause of inefficiency. of a road agency need to recognize that there are essential differences between maintenance projects and those for new construction or rehabilitation, as Assessment of Current Conditions shown in Table 1. and Project Formulation Construction projects can be successful and completed A road maintenance checklist has been developed with to specification and on time by contractual arrange- the objective of assisting those responsible for the ments independent of local resource constraints. identification of maintenance projects in the road Maintenance projects, if they are to result in permanent subsector in developing countries to assess the capabi- improvements in performance, demand a thorough lity of local maintenance organizations, and thereby assessment of the existing institutional, managerial and ensure that selected projects address those areas where technical capability of the maintenance department. investment could result in sustained improvements. The Failure to recognize this need in the past by donor checklist is attached and was designed to assess capa- agencies, consultants and client governments has bility in terms of the 'institutional', 'managerial' and resulted in many projects failing to sustain 'technical' aspects of an agency. The interdependence improvements in the long term, or even to meet project of these aspects can be better understood if the terms objectives in the short term. are described. Table 1 ESSENTIAL DIFFERENCES BETWEEN PROJECTS FOR CONSTRUCTION AND MAINTENANCE Construction Projects Maintenance Projects Duration Tend to be short-term Needs to be long-term Technology transfer Incidental Crucial to success Dependence on local capability Relatively independent capability Very dependent Consultant's organization Designed for rapid completion: Integrated with, and dependent on independent of local organization local organization organization Door Administration Straightforward Complex Extracted from: R. Robinson, et al., 1987. Road Maintenance Projects: Reassessing Objectives. In: UNECA, Fourth African Highway Maintenance Conference, Harare, 7-11 December 1987, Addis Ababa, United Nations Economic Commission for Africa. 182 Assessment of Maintenance Capability - Case Study Legal/Institutional Capability Technical Capability In developed mature economies, there invariably exists Without technical resources, an institutional framework a legal framework which defines unambiguously the and management expertise are of limited value. Suffi- responsibilities of government ministers and their cient numbers of competent staff at all levels are departments. This is not always the case in developing required by any organization. Lack of competence, at countries with the result that considerable reliance may any level, will effect efficiency, but it is particularly be placed on a senior office-holder's or minister's important at the lower levels of responsibility for plant personal interpretation of his powers and responsibi- operators, technicians, mechanics and laborers. lities. A change in senior staff may result in a different interpretation and lead to confusion and lack of com- Other technical capability requirements for efficient mitment amongst middle and junior management fearful maintenance management are: of being 'out-of-step'. * appropriate criteria for planning; Fundamental to the establishment of an efficient high- way maintenance department is the presence of statutes * materials test facilities; which define the department's responsibilities clearly and provide for: * effective quality control of all operations; * legal powers to undertake maintenance; * implemented pavement assessment and monitoring systems; * a rational and functional administrative structure; * access to research and information. * the employment and training of staff of sufficient calibre; The Checklist * funds to undertake maintenance and for administra- tion, salaries and expenses; The checklist was developed on the assumption that there was interdependence between the institutional, * financial control. managerial and technical capabilities as illustrated in Figure 1. This concept was first developed by management consultant and author John Adair in 1983 Managerial Capability to illustrate the interdependence of the man, the task, and the environment within an organization. He Where such an institutional framework exists, manage- attempted to demonstrate that, for an organization to be ment can concentrate on efficient use of human and effective, satisfactory performance in one area cannot physical resources with a clear understanding of the be achieved without complementary capability in the role of the department and its goals. Managerial others. Sufficiency of each element must be sustainable. capability requires: It may be that too much attention has been paid in the past to improvements in technical capability without * the existence of an up-to-date inventory; first ensuring that institutional and managerial competence can support this. In many countries, * works to be effectively planned, programmed and straightforward and relatively short-term assistance to monitored; upgrade technical capability may be appropriate, but only if institutional and managerial performance is * the budget to be linked with actual costs and the sufficient. The questions included in the checklist are ability to disburse; designed to be answered in the following way: effective cost control; Yes (Good) +1 * adequate plant and equipment to be available and effectively utilized; No (Bad) -1 * the availability of materials as required. To some extent (Indifferent) 0 183 Assesswent of Maintenance Capability - Case Snudy It was hoped that by coding answers in this way, it developing countries, has proved to be intractable, would be possible to analyze the results from the although it is clearly an important factor influencing checklist numerically to obtain a quantified assessment the performance of maintenance departments. It seems indicative of maintenance capability. likely that improvements at the institutional level are prerequisites to improvements in management and In order to test this approach, checklists were completed technical capability. The results from the checklist tend for road maintenance projects in ten countries with to support this hypothesis, since most of the countries GNP/capita ranging from just over US$200 to in excess evaluated failed to achieve a high enough institutional of US$3000. Information recorded was based on the score to provide the basis for investing in managerial capability of the maintenance organization being assis- and technical improvements. ted before the project was undertaken. If the number of "+1" (good) scores in each category was added together Considering again the relevance of the Adair model in and expressed as a percentage of the maximum possible Figure 1, it is clear that this does not explain fully the total score, it was found that there were major defi- relationship between the three elements. The hierarchi- ciencies in all of the maintenance organizations cal nature is better illustrated in Figure 3. Sufficient investigated. This is illustrated in Figure 2 which shows institutional capability is required to support and sustain that in no case did the aggregate score exceed 50%. managerial capability which, in turn, is a pre-condition It is also clear from Figure 2 that there is no discer- for sustained improvements in technical competence. nable relationship between the checklist score and GNP/capita. Use of the checklist is clearly subjective and the answers obtained refer only to a particular time. As such, they will be influenced by the effects of recent The Institutional, Managerial, maintenance or technical assistance projects which may and Technical Hierarchy only be providing temporary improvements in the capa- bility of the maintenance organization. However, it is It is, however, notoriously more difficult to effect believed that use of a checklist can greatly assist in the institutional improvements than to introduce specific better definition of those areas of the organization managerial or technical advances. For example, which are deficient, and to ensure that aid to the the problem of relatively low pay for government maintenance sector is of the kind which has the greatest employees and poor motivation, particularly acute in chance of success. INDIVIDUAL (Managerial Capability) ENVIRONMENT TASK (Institutional Capability) (Technical Capability) 184 Fig. I Adair model applied to a maintenance dept. Assessment of Maintenance Capability - Case Study 60 - 50 - - - - - - - - 40 30 - 48:. 43. 20 -4038 . .40 :. 32 29 1o -.20 Countries in order of increasing GNP/capita Fig. 2 Questionnaire results TECHNICAL CAPABILITY MAN'AGERIAL/FINANCIAL CAPABILITY ". LEGAL/INSTITUTIONAL CAPABILITY Fig. 3 Interdependence of institutional, managerial and technical capabilities 185 Assessment of Maintenance Capability - Case Study Road Maintenance Questionnaire 1. INSTITUTIONAL CAPABILITY 1.1 Legal powers 1.1.1 Is the responsibility for road maintenance legally defined? 1.1.2 Are all roads the responsibility of the maintenance department? 1.1.3 Are the legal powers understood? 1.1.4 Are the powers adequate? 1.2 Administration 1.2.1 Is there an adlministrative structure capable of maintaining roads? 1.2.2 Is there an unambiguous chain of command? 1.2.3 Are responsibilities defined? 1.2.4 Are staff aware of their responsibilities? 1.2.5 Are decisions independent of the influence of negatism, favoritism, graft or corruption? 1.3 Human Resources 1.3.1 Are there sufficient personnel available? 1.3.2 Are they adequately trained? 1.3.3 Are they adequately motivated? 1.3.4 Is there an internal training scheme? 1.3.5 Are there operations manuals? 1.4 Budget 1.4.1 Is a budget awarded? 1.4.2 Is it adequate? 1.4.3 Can it be relied upon? 1.4.4 Are operations independent of foreign exchange constraints? 1.5 Financial Control 1.5.1 Does full financial control reside within the maintenance authority? 1.5.2 Are accounts independently audited? 2. MANAGERIAL CAPABILITY 2.1 Inventory 2.1.1 Does it exist? 2.1.2 Is it up-to-date? 2.1.3 Does it cover location and classification of all roads and structures? 2.2 Planning and Programming 2.2.1 Is work programmed according to defined priorities? 2.2.2 Are the costs and benefits of programs assessed? 2.2.3 Is programming done within a plan designed to preserve or enhance the network in the medium/long term? 186 Assessment of Maintenance Capability - Case Study 2.2.4 Are there specifications for work? 2.2.5 Are specifications achieved in practice? 2.3 Budgeting 2.3.1 Is there a regular and formal budgeting process? 2.3.2 Is this related to actual costs and the ability to disburse? 2.4 Cost Control 2.4.1 Is work done measured and costed? 2.4.2 Are costs realistic in terms of overheads, equipment, materials and labor? 2.4.3 Is cost information collected centrally and used for budgeting purposes? 2.4.4 Is there a physical inspection and audit of work done? 2.4.5 Is productivity measured? 2.5 Plan and Equipment 2.5.1 Is there a fleet of plant and equipment of the size and composition required? 2.5.2 Is the availability adequate? 2.5.3 Is the utilization adequate? 2.5.4 Are the workshops and stores adequate to support it? 2.5.5 Is there an organization capable of managing the fleet cost effectively? 2.5.6 Is adequate financial provision made for replacement and repair? 2.6 Supplies 2.6.1 Are materials available as required? 2.6.2 Does an adequate system exist for ordering and stockpiling road maintenance materials? 3. TECHNICAL CAPABILITY 3.1 Planning Criteria 3.1.1 Are the criteria upon which road maintenance planning is based constantly under review? 3.1.2 Do strong links exist between those responsible for road maintenance planning and those responsible for: 3.1.2.1 design and construction? 3.1.2.2 traffic surveys and forecasting? 3.1.2.3 road safety? 3.2 Materials 3.2.1 Are the properties of materials used fully understood? 3.2.2 Are there adequate testing facilities? 3.2.3 Are materials of the right quality available? 3.2.4 Are appropriate materials always used? 3.2.5 Are testing methods appropriate and carried out at the appropriate frequency? 3.3 Quality Control 3.3.1 Is quality control of products and materials adequate? 3.3.2 Is quality control on site adequate? 187 Assessment of Maintenance Capability - Case Study 3.4 Condition Measurement 3.4.1 Are roads inspected systematically to determine maintenance requirements? 3.4.2 Are physical measurements made of road conditions to determine maintenance requirements? 3.4.3 Are condition measurements made using sophisticated or high-speed instruments? 3.5 Field Monitoring 3.5.1 Is there any systematic monitoring of: 3.5.1.1 quality of work? 3.5.1.2 material quantities used? 3.5.1.3 man-hours spent on job? 3.5.2 Do the results of any monitoring feedback into the future planning process? 3.6 Research and Information 3.6.1 Is there adequate access to current work on road maintenance from other maintenance organizations or international research centers? 3.6.2 Is research on road maintenance currently carried out within the organization? 3.6.3 Are new techniques and practices introduced as a result of research results? 188 Topic C: Case Study Sri Lanka: Training in the Construction Industry Before 1977, Sri Lanka had a government which favo- as possible in existing buildings. There would also not red the public sector, and as a result, the private sector have been the time to produce enough new instructors construction industry declined. The industry grew at 7% to carry out the training, and maximum use would have in 1974, but in 1977, it declined by almost 10% in spite to be made of the existing teaching staff at the Junior of public sector emphasis on house construction. The Technical Institutes, plus a further eleven Technical and industry was regarded as a resource consuming, rather Polytechnical Institutes. In 1980, the Government of Sri than a resource producing activity, and there was little Lanka and the World Bank planned a project to provide stress put on infrastructure development Following a construction industry training over three years. The change of government in 1977, economic policies were project commenced in 1981 and was expected to end in completely reversed; trade and import restrictions were 1984, but was extended to end in 1986. It has been removed and price controls relaxed. In a bid to achieve followed by a second vocational training project to an economic take-off, power, irrigation, housing and build on the results of the first. highway projects were undertaken, and the moribund private sector construction industry was suddenly To meet the training targets, it was obvious that tradi- required to expand. The construction industry workforce tional ways of construction training would have to be increased from 100,000 in 1977 to 229,000 in 1983, radically changed, especially as the facilities previously about 7% of all employment. producing 1,000-2,000 tradesmen a year would now have to produce ten times as many. Using a detailed The demand for more construction activity produced analysis by trades experts of the actual skills required shortages of materials and of skilled workers. Construc- by the principal categories of construction workers tion costs increased by from 50% to 100% between (masonry, carpentry, plumbing, electrical wiring, steel 1977 and 1979, and wages of tradesmen went up by a fixing and barbending), it became apparent that new third. To further decrease the local industry's capacity, entrants could acquire sufficient skills for first the migration of skilled workers to the Middle East employment by a Basic Skills Module made up of ten continued. The Government of Sri Lanka realized while weeks of institutional training, followed by ten weeks putting together their 1979-83 Medium Development of controlled on-the-job training. After a period of Plan that unless more skilled construction workers employment, the new tradesman could move on to a could be produced, the Plan could not be completed. higher level of skill by going through an Advanced Skills Module, lasting from six to eight weeks, Based on an analysis of the Development Plan and depending on the trade. The Advanced Skills Module other probable private sector construction, plus a was also suitable for those already in the industry to manpower survey, it was estimated that there was a update and upgrade their traditional training. need to train about 45,000 new entrants in basic con- struction skills, to upgrade the skills of a further 9,600 Since employable tradesmen could be produced after tradesmen, and to train 1,800 mechanical equipment only ten weeks in a training institute, instead of two operators and 900 works supervisors. Training was also years traditionally, the necessary tenfold increase in required for 80 experienced senior works supervisors in output was possible with the same buildings and staff. work planning and management. Only the follow-on ten weeks of on-the-job training called for extra resources, and most of these were Tradesman training in Sri Lanka had been either by supplied by employers, monitored by a small group of several years of apprenticeship with a Master Crafts- inspectors. The only major extra facility needed was an man, or by a two-year Crafts Course in masonry or equipment operators' training center, because operator carpentry at one of 13 Junior Technical Institutes. The training had not previously been done in Sri Lanka. total output from both these sources made up for Each Basic Skills Module student was given a retirement from the industry, but could not help towards handbook to use as a reference during and after train- the expansion required, especially as the almost 60,000 ing, and a tool kit free of charge on successful to be trained were wanted within about three years. completion. The training was continuously assessed, Within the time available, it would not have been and a daily diary and work experience schedule had to possible to build all the training centers necessary, so be completed during on-the-job training. Living that whatever was to be done would have to be as far allowances were paid for the twenty weeks of training Although a proportion of those trained later went to the Middle East, this was a substantial benefit to Sri Lanka. A Sri Lankan working overseas sends 80% to 90% of his earnings back home. In 1983, foreign exchange remittances of Middle East workers at US$290 million, were the second largest source of foreign exchange earnings after tea exports (US$353 million). 189 Sri Lanka: Training in the Construction Industry - Case Study and, thereafter, employers were expected to give a contractors' associations; design economics and the further 30 weeks of on-the-job training, which was construction industry; and strategic planning for the monitored, although no allowance was paid. industry. The aim of this wide review was to coordinate all aspects of the whole industry, public and private, so Before this project, training given by different as to increase the effectiveness of the training given, institutions varied in content and standard, and and to reduce the chances of conflicting standards and employers found it difficult to assess the skills of new practices. recruits. To help overcome this, standard specifications were agreed between different government ministries, Several interesting aspects of this project might be and their use was recommended to private industry. applied elsewhere in other projects. They are: Training was tied to these specifications, and a National Skill and Trade Testing system set up for the main * the target output numbers were clearly set at the trades. The modular training given under the project outset, and had been based on a realistic assessment was sufficient for students to pass their trade test, and of current conditions. When conditions changed, so employers had a guarantee of their abilities. forecasts were quickly reassessed and outputs revised; Progress and the effects of training were monitored throughout. Three tracer studies were done in 1983, the scale of training to be given was also clearly 1984 and 1985 to evaluate the performance of students specified, so as to give essential skills-and only in industry. These were followed by an impact assess- those skills-required to overcome the shortages ment study in 1987 to ascertain trainee attiltdes, work that existed; quality and wages. It was found from these studies that the quality of the tradesmen trained under the modular * it was understood that for training on this large system was at least as good as those trained in the scale to be effective, other aspects of the industry traditional way, and in some respects was better. About needed to change. These included trade testing and 60% of those trained were being paid at usual average the status of construction workers in society, as well rates or above, which indicates satisfactory per- as the work of the various specialist sub-committees formance. set up; Because of a reduction in demand for construction, due * the project was put under the control of full-time to a slowdown in the economy, targets for training were local staff who were given clear guidance and reduced during the project. In the end, about 38,000 responsibilities by the steering committee, who were trained, a reduction of about 40% in tradesmen, represented all interested parties in both the public but an increase in the number of operators, supervisors and private sectors; and works managers trained. The average cost per person trained was found to be significantly lower than * the Sri Lankan Government coordinated the conflic- for the traditional methods. ting interests of different ministries and departments through the Secretaries' Committee of the most The whole program was under the control of one senior civil servants. In this way, interministerial Ministry, although six different ministries and about 13 conflict was resolved without affecting the progress different departments of the government were involved. of the training; This could have been a recipe for inactivity, but a Secretaries' Committee for the Construction Industry * the products of the training were monitored over the was set up on which all different agencies of the whole period by follow-up and impact surveys, and government were represented. This committee dealt the results of these were used to review training with liaison and government policy as it affected the content and methods, or to revise the numbers to be industry and the training project. The day-to-day admi- trained; and nistration was done by a project unit. there was a clear and obvious need for the training, The project unit received guidance from the Secretaries' which was recognized by everyone. Committee and from the National Steering Committee. The latter had on it representatives from all parts of the construction industry in both the public and the private There is little doubt that the success of this training sectors. It set up five sub-committees to look into and, effort under difficult circumstances was mainly due if desirable, recommend changes in: tender procedures, to the determination and commitment of one or two contractor prequalification, conditions of contract and individuals in the Sri Lankan Government, who first specifications; training for upper- and middle-manage- realized the urgent need for training on this scale, and ment, quantity surveying and quality control; contrac- then communicated their commitment to others. 190 Topic C: Case Study U.K.: Evaluation of Incentives for Efficency in Road Maintenance Organization* Summary study values and laborious operating procedures, the relationship between bonus earning performance and Bonus incentives schemes for highway maintenance productive output inevitably deteriorated. Most labor have been used and developed by highway importantly, there were no overall compelling incentives authorities in the United Kingdom (UK) since 1960. for management to improve cost effectiveness through Since 1981, the local highway authorities have been planning, programming, and control of work. required to carry out road maintenance on a contract basis, in partial competition with private contractors. Some highway authorities, however, realized that the work study data upon which the incentive schemes This study reviews and evaluates the productivity and were formulated had other uses. This led to the devel- cost effectiveness of direct labor operations of the opment of the computerized RATE system for estima- country highway authorities in the UK. It evaluates the ting, resource allocation, and standard costing. performance indicators for four of these departments. More generally, the study assesses the applicability of The concept of combining elemental values to form the UK experience to the developing countries, given composite work values, similar to the items in a the often very serious weakness in public administration Schedule of Rates or Bill of Quantities employed in the in many of those countries. RATE system provided the foundation for the 'pre- targeted' or 'pre-evaluated' bonus incentive schemes. In the 1960s, bonus incentives were mainly introduced But it was the combination of increasing public dis- in high wage areas to facilitate the retention and satisfaction and the demands of legislation which recruitment of labor. By 1968, some 25% of highway prompted the change from the post-work measurement authorities had introduced incentive schemes. Common 'payment-by-results' incentive schemes, to 'pre- design principles for such schemes had been established targeted' schemes. The latter require the scope of the and there was pressure from the Central Government on work to be predetermined and provide a direct relation- all local authorities to tie future pay increases to ship between productivity and unit costs. productivity. The 1970 Marshall Report showed that highway authorities could obtain considerable cost For some time the efficiency of the Local Authority savings from bonus incentive schemes and recom- Direct Labor Organizations (DLOs) had been question- mended their adoption. By 1972, highway authorities ed and several studies had concluded that they should throughout the UK had adopted bonus incentives be established as public commercial enterprises in schemes for direct labor maintenance operations. competition with the private sector. This led to the: DLO Legislation (effective April 1, 1981), which requi- The incentive scheme commonly adopted was the res a Highway Authority Direct Labor Organization to: "payment-by-results" type providing a varying amount of bonus according to the amount of work claimed by maintain separate accounts of income and expen- the employee. Standard minute values (SMV), derived diture; from method-time-measurement techniques, were assi- gned to discrete elemental activities, but they did not tender competitively for some work and submit esti- have a direct relationship with commonly recognized mates for the remainder of its work; roadwork operations. achieve a set rate of return on the capital employed; Initially, highway authorities obtained considerable cost savings and marked increases in productivity from the provide and publish annual reports with detailed adoption of payment-by-results incentives schemes. records on its financial performance; Over time, defects in the design and application of some schemes eroded both their effectiveness and the and also vests in the Secretary of State for the Environ- related productivity gains. Owing to multiple work ment the power to close down a loss-making enterprise. Brian R Cox, Transportation Department, Operation Policy Staff, The World Bank, Washington, D.C. 191 U.K.: Evaluation of Incentives for efficency in Road Maintenance Organization - Case Study The amount of highway work initially subjected to The study showed that the DLO Legislation has produ- competition was very small and, although successively ced a significant change in the attitude of the mana- increased, comprise less than half of all the work gement and the work force because of the requirement carried out by direct labor. Competition, to some extent, to compete, to execute activities contractually, to has been diminished by the contract procedures adopted control costs, and to monitor cost-effectiveness. The by some authorities. Proposed legislation is expected to implementation of incentive schemes linking producti- increase the amount of open competition, extend the vity with real output has demanded a change in the range of local authority services subject to compulsory attitude of the work force and its trade unions at the tendering, and reduce restrictive contract conditions local level. This has led to improvements in work which local authorities can impose. discipline, team effort, and the abandonment of restrictive practices, such as the 'no redundancy' The incorporation in DLO Legislation of all types of agreements. highway work within a single accounting category and the consequent opportunity for DLOs to cross subsidize Competitive pricing of work, accurate assessment of between competitive and non-competitive work is a resource requirements, and close monitoring of income matter of contention between the local authorities and and expenditure, has encouraged the development of private contractors. The proposed increase in the locally operable micro-computer systems for estimating, amount of work subject to competition is likely to resourcing, and accounting, with rapid feedback reveal- reduce the opportunity for cross subsidization. ing performance at all levels of an organization. Micro and mini-computer based RATE type estimating sys- The requirements of the DLO Legislation have already tems interfaced with DLO accountancy systems have produced substantial changes in the organization and been installed by six of the seven countries studied. execution of highway maintenance. The DLO Manage- Competition with DLOs, however, has had an adverse ment has been able to improve the cost-effectiveness of effect on some small private contractors through the its operations through better prediction and program- withdrawal of assistance previously provided freely by ming of resource requirements. The recommendation the highway authorities. associated with the DLO Legislation that all work should be described in accordance with a Schedule of The private construction industry has alleged that some Rates or Bill of Quantities has necessitated the local authorities are frustrating the intent of the DLO quantitative pre-determination of maintenance needs by Legislation to promote open competition by manipula- the 'client' highway authority. As the competition ting the competition rules and imposing contract condi- becomes keener, the DLO management must think and tions unrelated to work performance. The local authori- act commercially, since the survival of the DLO will ties, on the other hand, maintain that their DLOs are eventually be determined by its performance as a disadvantaged by a restricted market and by mandatory contractor. public employment conditions superior to those offered by private contractors. About 12% of local authorities The profits from DLO operations may not necessarily have adopted discriminatory contract compliance be spent for the benefit of DLO and are to be returned policies which the central government regards as an to the general exchequer. As a result, the actual rate of abuse of contractual powers. New legislation has been return on capital achieved by a DLO is more a reflec- proposed to restrict such contract conditions. All of the tion of the DLO's accounting capability than its effi- authorities' studies had considered cross-subsidization ciency or cost effectiveness. The target rate of 5% between competitive and non-competitive work, but had prescribed by the DLO Legislation equates to on ave- been deterred by the risk of detection and publication rage 1.25% return on turnover, which is far below an of an adverse report by auditors. One of the countries acceptable margin for a private contractor. The rate of studies had adopted price bargaining with material return requirement has focused attention on items that suppliers following a successful tender by its DLO, a could reduce gross income, such as excessive labor, marked departure from traditional local authority material and plant costs, and overheads including those purchasing procedures. originating from other Country Council departments. The DLO Management has also become aware that the Initial operational experience with the DLO legislation capital employed must be limited to that needed for the indicates the need to separate the 'client' and 'contrac- efficient operating of the DLO. This has brought about tor' functions of highways departments. Of the seven a reduction in capital holdings such as offices, stores, countries studied, six had adopted or were moving plant, and machinery. The annual reporting requirement towards a separation of client and contractor responsibi- allows public scrutiny and permits the DLO Manage- lities. The other country had established a totally ment to promote its services to its 'clients.' The power separate DLO department operating as a free-standing of the Secretary of State for the Environment to close public contractor. This option is being chosen by an down an unsuccessful DLO is similar to the closure increasing number of local authorities. Although the from bankruptcy that befalls a loss-making contractor. dual 'client' and 'contractor' systems for administration, 192 U.K.: Evaluation of Incentives for efficency in Road Maintenance Organization - Case Study costing and work measurement had increased the admi- The power of the Secretary of State to close down aloss nistrative and technical work load, it was reported that making DLO, similar to the bankruptcy of a private the separation of client and contractor responsibilities contractor, has been exercised at least once with respect had enhanced efficiency and cost-effectiveness by ena- to the housing construction DLO of a London Borough. bling a clear definition of objectives and corporate Various indicators were examined to determine the identity. effect of the DLO legislation of cost-effectiveness. It was found that the most competitive of the four coun- The increased cost-effectiveness obtained from simple tries studied had increased its labor productivity by productivity-based incentive schemes, improved mana- 18% and the productive time of its labor force by 29%. gement systems, and a general awareness of the need Since the implementation of the DLO legislation, for efficiency, has been accompanied by net savings in increases in the value of work per road worker (ranging manpower despite the additional management and admi- from 24 to 32%) had been registered by all four nistrative requirements. The reduction in the DLO labor countries. force of the four countries evaluated in this study ranged from 7 to 24%. Material costs have been Changes in the composition of road maintenance costs contained by changes in procedures giving DLO mana- were also examined for the four countries studied. The gement more freedom to directly purchase materials and two countries with large DLOs undertaking equipment negotiate with suppliers, and by the use of the RATE intensive construction and rehabilitation activities had type systems to identify both individual quantities and achieved reductions in plant and vehicle costs, whereas delivery requirements. Two of the authorities studied the two countries with smaller DLOs mainly employed have established separate Plant and Vehicle Manage- on labor-intensive routine maintenance activities, had ment Organizations, serving all their Country Council achieved reductions in the labor cost component, sug- departments, operating on a competitive commercial gesting concentration in each case on those areas where basis. It is expected that this arrangement will be economies would most enhance DLO competitiveness. adopted by most local authorities when the proposals The availability of data for examination of the effect extending competition to equipment management of the DLO legislation on unit prices was limited by become effective. The restructuring of DLOs to contractual confidentiality, but three countries supplied improve operational efficiency and to minimize the some information, and national price indices were capital employed has produced substantial reductions in supplied by the Department of Transport. The study offices, depots, stores, and equipment holdings. Over- confirmed that open competition had restrained unit heads have increased with increased management costs, prices and so increased the value for money obtained but the evidence from the countries studies suggests from public expenditure. that the upward trend has now been contained and, in some cases, reversed. An assessment was made for the potential for the further improvement and the effect of the measures There is evidence that competitive pressures have taken so far to increase competition. It was found that encouraged developments in maintenance technology. the total highways expenditure in 1984/85, about 46% One of the countries studied has devised a patching was expended by County Council DLOs, and that only system providing a tenfold increase in the daily output about 9% of this had been subject to open competition, of repair material used. corresponding to about 20% of the total DLO expenditure. Changes in the competition rules had some The rate of return achieved by countries, ranging from effect-the proportion of DLOs with a record of 4% to nearly 50%, may be regarded as an indication of minimal competition (0%-5%) decreased from 35% in estimating and accounting capabilities rather than 1981/82 to 9% in 1984/85, while the record of DLOs profitability. The treatment of the surplus earned by competing for more than 30% of their work, increased DLOs was found to vary between authorities. Of the from 0% in 1981 to 12% in 1984/85. Although the seven countries studied, two of the DLOs retain the DLO legislation has enhanced cost effectiveness, there surplus as a fund for the purchase of equipment and so is scope for further improvement and additional on, one authority returns the surplus to its maintenance increases in the amount of work subject to competition funds, another country returns the surplus to its general will prove beneficial. It is doubtful whether these exchequer, and the other three DLOs retain about 50% developments would have occurred without the spur of the surplus as a reserve fund, the remainder being provided by the DLO Legislation. transferred to central funds. Five of the seven countries were using the DISMIS accountancy system with The experience and knowledge gained in UK with Micro-RATE to monitor the rate of return achieved on productivity-based incentive schemes for maintenance a weekly basis so as to fine tune prices and avoid labor could well be transferred to many developing excessive surplus. countries which, due to a low public sector wage 193 UJC: Evaluation of Incentives for efficency in Road Maintenance Organization - Case Study structure, cannot recruit or retain qualified staff or cost control and estimating procedures. Although the skilled personnel. The economic gains from increased reported experience with contract maintenance is productivity would have to be considerable in order to favorable, disadvantages may accrue in some finance incentive schemes. Portable, user friendly, developing countries which do not possess the public micro-computer based, RATE-type estimating and service capability to manage contracts or have a accounting systems, whose operation does not require sufficiently well-developed contracting industry. A high level accounting or engineering skills, could gradual introduction of competition along the lines beneficially be adopted by developing countries that developed in the UK could effectively promote the depend on cumbersome, manually-operated budgetary, strengthening of both the public and private sectors. 194 Topic C: Case Study U.K.: Twinning Arrangements Between Staffordshire County in the United Kingdom and Accra City Council in Ghana* Introduction in the field have had practical experience in jobs similar to those which the client's staff are performing. For a A "twinning" arrangement has been set up between client, a twinning arrangement means that the technical local authorities in the United Kingdom and Ghana as assistance comes from a very credible source-another a small part of the Accra District Rehabilitation Project entity actively and successfully engaged in the same with the assistance of the World Bank. The objectives type of operations. of the project are road construction, road rehabilitation, road maintenance, area improvement, municipal revenue mobilization, and the associated institutional Description of Local Authorities Involved development including training. Accra City Council (ACC) is in many respects similar The components of the project with which Staffordshire to Staffordshire County Council (SCC). Both authorities County Council are involved are road maintenance, have similar though not identical statutory revenue mobilization, and the associated institutional responsibilities, and their organizational structures are development. The duration of the project was five based on a common legal and administrative tradition. years, terminating on December 31, 1989. Officers and members from either authority visiting the other are, to a considerable extent, familiar with the Twinning can be defined as a professional relationship powers, duties and systems operating in the other between an operating entity in a developing country authority. and a similar but more mature organization in another part of the world. The services provided by the latter Although ACC is largely an urban authority while SCC differ from those of a consulting firm in the following includes urban and rural areas, in many respects they respects: are comparable. Both authorities have similar problems although very different in scale. Each authority * "The supplier of TA has operating experience in considers that there are services which they would wish similar functions." to make available to the people of their areas, but for which the resources are not available. Both authorities * "Twinning provides opportunities to integrate TA have judged that there need to be increased expenditure and training." on highways and transport infrastructure, both have areas of housing which require improvement or recons- * "There is flexibility to alter the work program over truction. Each authority has a population slightly in time and the possibility of very long-term excess of 1 million (Accra 1.2 million, Staffordshire cooperation." 1.02 million). Both authorities have over 600 schools. * "The TA supplier may lack worldwide experience." As an indication of the scale of SCC's operations and the resources available to the County Council, the * "The supplier may lack experience in the consulting annual revenue budget for 1988/89 exceeds £620 m, profession." and the capital budget £33 m. The major functions being education, highways and transportation, police The major advantage of a twinning arrangement to and the provision of social services, and various other provide TA is having an operating entity stand behind services from the administration of justice to the the TA supplier's work. Thus, the entity that provides provision of small holdings, libraries, and museums. the assistance can draw upon its own in-house resources in the relevant functional areas, offering services as needed in the client's complementary functional areas. Accra District Rehabilitation Program For example, a supplier entity in a twinning arrange- ment can train client staff as it trains its own in In June 1984, a World Bank Mission appraising the operating or maintaining equipment. Also, the experts Accra District Rehabilitation Project included a local E.T. Mensah, Executive Chainnan, Accra City Council; and M.J. Simpson, Deputy Clerk, Staffordshire County Council, U.K. 195 U.JX: Twinning Arrangements between Staffordshire County and Accra City Council - Case Study government officer from Staffordshire County Council morale of the workforce of the organizations. Whether provided with British Government financial support to or not this can be attributed to the twinning consider whether a twinning arrangement could arrangements must be determined after careful contribute to the project. Staffordshire was subsequently evaluation. asked whether it was prepared to be involved. After discussions with the Accra City Council and the World The institutions are now performing specific tasks more Bank Mission, the County Council agreed to take part effectively, and there are individuals within the in a Twinning Agreement. Staffordshire was informed organizations that are better able to carry out those that the arrangement would be experimental, in that tasks as a result of the period of training and there was little previous experience of multi-functional secondment under the project. These secondments have twinning. They were asked whether they would be been applied both to Staffordshire and to other prepared to be evaluated during and at the end of the institutions in England. A critical factor has been the project to see whether the twinning had been successful strong political leadership of ACC. Whether the and what lessons, if any, could be drawn from the institutions have been sufficiently strengthened to experience. The County Council was happy to agree to enable their performance to be sustained if key such an arrangement, the details of which followed very individuals were to be promoted or to leave the organi- closely Technical Paper No. 23. The main points of the zations is uncertain. arrangement were that Staffordshire staff would spend time in Accra, split between long-term secondments working in Accra on specific topics, and short-term Twinning Arrangements - Advantages visits providing supervision by the Staffordshire staff, to assist and advise wherever possible. in addition, As the arrangement is essentially long-term, institutional Accra staff would spend time in England, either with links have been build up between SCC and ACC and Staffordshire, or with other organizations in the U.K. It between individuals within the organizations. Once the was envisaged that Staffordshire would be prepared to formal project is complete, it is likely that the links will act as host to the staff and in the event of them having survive and that ACC staff in England will continue to any problems would use its best endeavors to ensure be welcomed to the County council. In addition the that those problems were dealt with. British Council and independent training organizations are recognizing the links that exist and are seconding The main features of the project are as follows: Ghanaian Staff in training in England to SCC. Infrastructure Rehabilitation The SCC-ACC links are now sufficiently well Road and Drainage Rehabilitation and Maintenance established for SCC views to be sought on problems Basic Infrastructure Upgrading in East Maamobi and topics not necessarily connected with the project Resource Mobilization but relating to local government and public adminis- Property Revaluation tration generally. Municipal Revenue Mobilization Resource Mobilization at the Municipal Level The early visits to England under the project were longer-term (three months) not relating specifically to ACC or SCC but to a general topic or area. As the The Developing Situation 1984 to 1989 project has developed, visits have been targeted more specifically on particular topics-budget construction, The secondments to Accra by Staffordshire Staff were road maintenance, traffic engineering, quality control, split into short-term and long-term. There have been debt collection-where the topic and the individual are short-term visits amounting to approximately 30 man specifically chosen in the knowledge of the Stafford- weeks, long-term secondments of 48 man-months, shire practice and Accra needs. Specifically targeted (2 Officers) relating to Highways, and 18 man-months visits are very cost effective. (1 Officer) relating to financial matters. The project provisions originally anticipated two further full time The long-term nature of a twinning arrangement means officers. The time spent in England by Accra Officers that there can be a reduced risk of an inappropriate and members was similar, at approximately 30 man- transfer of technical assistance or technology. A deeper weeks. The twinning provision within the original understanding of the problems, possible solutions and project has not been fully used. consequences can be achieved when a longer time frame is deliberately chosen. The operational situation in Accra was that both of the components with which the twinning was involved Once a trust has been built up between individuals showed a great improvement. There was a substantial within the institutions, it is possible to examine not only increase in the roads being maintained and the revenue successful schemes and systems to see to what extent collected. Equally impressive was the improvement in appropriate lessons can be drawn, but also practices to 196 U.K.: Twinning Arrangements between Staffordshire County and Accra City Council - Case Study be avoided and systems that are no longer applicable. Because of the lack of overseas experience, greater Given the scale of Staffordshire's operation and the demands are put upon both the Accra staff and upon length of time for which it has operated, the experience the World Bank supervisory staff. A consultant with to be drawn upon is considerable. overseas experience knows what is expected of him within the terms of reference and what discretions and The institutional links between like institutions enable authority he is able to exercise. The guidance required the inter-relationship between the political, managerial, by Staffordshire, particularly from the World Bank administrative, and technical problems to be fully staff, is considerable and must put additional demands evaluated. The specific links between direct service upon them. delivery and revenue collection can be an invaluable aid to performance. The political and institutional impli- Changes in personnel in Accra, Staffordshire, or cations of an apparently simple technical decision are Washington during the course of the twinning can have often apparent to an institution facing similar problems a considerable impact. Fortunately, there has been a and ought to make the process of institutional large measure of continuity. development more effective. The objectives of a project, or the relative importance The time frame of the twinning arrangement permitted of objectives within a project, are not always apparent. the planning of successive visits to Staffordshire to Is it more important to incur expenditure as program- secure an overview of the process which would not be med or when it will make the most significant contri- possible over a shorter time frame. A succession of bution to the project? Should equipment be procured in short-term visits spread over several years at specific advance of the institutional development to secure its points in the Staffordshire financial planning process proper use? Staffordshire's views are conditioned by gives a better insight into the institution and its its UK practice which may not accord with project operation than a view from a single point in time with objectives. The availability of appropriate staff in a description of the parts of the process not current. England will vary over time. By explaining the Staffordshire institutions to Accra The establishment of a relationship whereby the Accra City Council staff across a range of functions, Accra staff are not threatened by the existence of visiting staff are able to draw conclusions that may be relevant "experts" is a crucial task and one where a prior to Accra which are not apparent to Staffordshire staff. knowledge of the cultural background would have been helpful. Twinning Arrangement - Difficulties Experienced The appointment of counterpart staff is considered by The following are difficulties that Staffordshire and SCC to be of paramount importance to enable the full Accra have experienced. To mention them is not to cri- benefit of the twinning to be achieved. It has been ticize any individuals either in Accra or Staffordshire. difficult to secure the appropriate appointments in view of the shortages of available qualified staff in Accra. The work involved with the twinning arrangement for those Staffordshire staff based in England is not their The project budget contains a provision for training. main responsibility and at times must take second place SCC view is that the technical objectives of the project to their normal duties. This can cause delays in giving are comparatively easy to achieve. However, the institu- needed advice and assistance. Visits to Accra have to tional development needs of the organizations are far be accommodated within a timetable of work in more difficult to achieve; only by fully utilizing the Staffordshire that may be fixed. training opportunities will the organizations be strengthened sufficiently to enable them to survive as The legal framework under which British Local effective organizations, able to meet changing demands, Government operates is very specific and indeed can as with the inevitable changes in personnel as existing change during the course of a twinning arrangement. staff retire, are promoted, or leave for other posts. At British staff have to ensure that their activities and the present, the organizations are very dependent upon key actions of their institution comply with the legal individuals whose contributions to the organization constraints. Any payments made by the County Council would be difficult to replace if they were promoted or are subject to British audit and financial constraints. left the organization. Training in depth is required. The Staffordshire staff may have little experience working complexity of an urban project such as the Accra of overseas. The time taken to familiarize themselves in project may be inevitable, but the mix of technical the African environment is greater than would be requi- objectives such as highway construction within the red if the institution had overseas experience prior to same project as institutional objections may create the twinning. Accra staff coming to Staffordshire are the possibility that the more easily measurable and able to adjust more easily. achievable technical objectives are given priority. 197 U.K.: Twinning Arrangements between Staffordshire County and Accra City Council - Case Study However, the visible achievement of some of the It may be fruitful to consider ways of maintaining the project objectives increases the chance of success of institutional links between Accra and Staffordshire once the other institutional objectives and an evaluation of the formal project is complete. The design of World the relative benefits of simple or more complex projects Bank projects to ensure that the priority of institutional would be helpful investigation. development is maintained while not losing the undoubted benefits of being part of a viably successful On a more detailed level, the variances in exchange project may be usefully investigated. rates can further complicate matters for the Staffordshire County Council. The possibility of linking an institution such as Staffordshire, which at the outset of this project had limited overseas and World Bank experience, with The Way Forward consultants familiar with World Bank procedures and the Country concerned, should be explored An independent external evaluation of the Accra expe- and evaluated. riment would be useful both to the participants and to others considering a similar project. It may well be The individual bonds made in Accra and Staffordshire that a follow-up to Technical Paper No. 23 would be are highly valued, and participation in the project has worthwhile. been a stimulating and rewarding experience. 198 SUB-SAHARAN AFRICA TRANSPORT PROGRAM ROAD MAINTENANCE INITIATIVE ANNEX 1 ANNEX 1 Road Maintenance Policy Seminars Agenda Day 1 9:15 - 10:00 am Opening session -Introduction of Moderator: World Bank -Official Openning: Minister of Transport and Communications -Welcome: ECA -Opening: SSATP -Operating rules for seminar: EDI 10:00 - 10:45 Introduction and overview -A policy Foundation for Better Roads: World Bank -Open Discussion: World Bank 10:45 - 11:00 Coffee 11:00 - 12:15 pm Open Discussion (continued) 12:15 - 1:45 Lunch 1:45 - 2:00 Policy Action Planning: ESAMI/CDG -General overview and introduction; Linkages to Phases II and III of Road Maintenance Initiative 2:00 - 2:20 Topic 'A' - Planning Financing and Management -Policy Issues and Options: World Bank 2:20 - 3:45 -Discussion and Summary of Key Issues -Identification of subjects for Workgroup discussions 3:45 - 4:00 Coffee 4:00 - 4:20 Topic 'B' - Operation and Management -Policy Issues options: Adviser 4:20 - 5:45 -Discussion and Summary of Key Issues -Identification of subjects for Workgroup discussions 7:00 - 8:31 Cocktails 200 ANNEX 1 Road Maintenance Policy Seminars Agenda Day 2 9:00 - 9:30 Topic 'C' - Human Resources and Institutional Development -Policy Issues and Options: EDI 9:30 - 11:00 -Discussion and Summary of Key Issues -Identification of subjects for Workgroup discussions 11:00 - 11-15 Coffee 11:15 - 12:30 pm Plenary Discussions and Group Workshops -General Open Discussion - Topic 'A', 'B' and 'C' -Group formation and Allocation of Workshop Issues -Groups appoint Chairmen and Rapporteurs 12:30 - 2:00 Lunch 2:00 - 4:00 Workshops -Specific Topics and Issues (with assistance from Advisers and resource persons as requested by groups) 4:00 - 4:15 Coffee 4:15 - 5:45 Plenary -Workshop reports -Guidelines for Policy Action Planning: CDG 7:00 - 9:00 Cocktail Reception 201 ANNEX 1 Road Maintenance Policy Seminars Agenda Day 3 Policy Action Planning 9:00 - 9:30 am Guidelines for Policy Action Planning (continued): CDG 9:30 - 10:00 -Demonstration of Use of Guidelines and Approaches to Policy Action Planning: ESAMI/CDG 10:00 - 10:15 -Discussion of Guidelines and Road Maintenance Initiatives phase II and 111 10:15 - 11:00 -Country Teams - Policy Action Planning (guidance available from Advisers and resource persons if requested) 11:00 - 11:15 Coffee 11:15 - 12:30 pm -Country Teams - Policy Action Planning (guidance available from Advisers and resource persons if requested) 12:30 - 2:00 Lunch 2:00 - 2:30 Plenary -Open Discussion and Clarifications of Policy Action Planning if necessary 2:30 - 4:00 -Country Teams - Policy Action Planning (guidance available from Advisers and resource persons if requested) 4:00 - 4:15 Coffee 4:15 - 5:45 -Country Teams - Policy Action Planning (guidance available from Advisers and resource persons if requested) 8:00 - 10:00 Seminar Dinner 202 ANNEX 1 Road Maintenance Policy Seminars Agenda Day 4 9:00 - 11:00 am -Country teams - Reports to Plenary -Results of Policy Action Planning (level of Detail at country Team's discretion) -Country Team perceptions of Policy Action Planning process and Phases II and III of RMI 11:00 - 11:15 Coffee 11:15 - 12:30 Synthesis of Seminar including indications regarding Phases II and III and next steps for progress (SSATP) 12:45 - 2:15 Lunch -Guest Speaker (Minister of Transport and Communications) Final Plenary 2:15 - 3:00 -Open Session (subjects to be proposed by participants) 3:00 - 4:00 -Evaluation of Seminar 4:00 - 4:45 -Coffee and Formal Closing of Seminar 203 � .: V� С � � � � � � � � � г� Z � �� г rn � �� � т� � : г �' � �� а ?� � . -v � т0 � � а � � � Contents: Volume I ANNEX 2 Preface vii Overview of the Seminars ix Chapter 1 - The Road Maintenance Initiative: A Process of Policy Reform I The Sub-Saharan Africa Transport Program 1 Road Maintenance Iritiative: Background and Justification 2 Objectives 4 Road Maintenance Policy Seminars, 5 Objectives of Phase 1 5 Participants 7 Preparation 7 Content and Format 8 Policy Action Planning 8 Follow-Up 9 Chapter 2 - Road Deterioration in Sub-Saharan Africa: The Policy Agenda .10 The Economic Background 10 The State of Sub-Saharan Africa'sRoads 11 World Bank Experience 17 Future Prospects 17 The Policy Agenda 18 Agenda for the Seminars 19 Planning, Financing, and Budgeting 19 Chapter 3 -Policy Reform: Issues and Options 21 Participants' Views on Preconditions for Policy Reform 22 Planning, Financing, and Budgeting, 24 Operations and Management 30 Institutional Reform and Human Resources Development 35 Chapter 4 - Policy Action Planning 42 Policy Action Plannbig: The Process 42 Inside a Policy Action Planning Workshop 44 Reaction of the Participants 47 Areas for Further Work 48 Chapter 5 - The Follow-Up: National Road Maintenance Initiatives 51 Key Considerations 51 Program Implementation 52 Endnotes 54 Annex I - List of Participants 55 Annex 2 - Road Networks by Country 75 Annex 3 - Expenditures on Highways 77 Annex 4 -Contents Volume II and 'Volume 111 79 206 Contents: Volume III ANNEX 2 Preface vii Overview of the Seminars ix How We Will Apply Policy Action Planning in This Seminar 2 1. Methods for Policy Action Planning 1.1 What Is PAP? 4 1.2 What Are the Components of a Policy Action Plan ? 5 1.3 How to Establish the Policy Action Plan? 7 2. Option Charts for Road Maintenance Policy 2.1 Some Basic Considerations 15 2.2 Structure and Elements 16 2.3 Check Item Directory: Overview 18 2.4 Check Item Directory 21 2.5 Option Charts in Tabular Form 56 3. Transition to Phase II 57 4. Worksheets 60 Annex 1 - Contents Volume I and Volume H 207 Distributors of World Bank Publications ARGENTINA PINLAND MEXICO SOUTH AFRICA, BOTSWANA Caos Hirech, SRL Akatemeina Kirjakappa ]NPOEC For si l tiles Galeria Gomes P.0 BoX 128 Apartado Postal 22-860 Oxford University Pres Florida 165,4th Floor-Of. 453/465 SF-W0101 l400TIalpar, Me1co D.F Southern Africa 1333 BueerAires Helsinki 10 P.O. Box 1141 MOROCCO Cape Town 80m AUSTRALIA, PAPUA NEW GUINEA, FRANCE Socided d'Etudes Marketing Marocaine FIJL SOLOMON ISLAND, World Bank Publications 12 re Morart Rd. d'Anfa Forslscr4rtion ordo: VANUATU, AND WESTERN SAMOA 66, aveue d'Idna Casablanca Internationl Subscripton Service DA. Books &Jourruls 75116 Paris P.O. Box 41095 645WhitehorseRoad NETHERLANDS Craighau Mitcham 3132 GERMANY InOr-Publikaties bmv. Johannesburg 2024 Victoria UNO-Verlag P.O. Box 14 Poppldarfer Allee 55 724D BA ochem SPAIN AUSTRIA DSMW Bann I Mundi-Prensa libro, SA. Geraldand Co. NEWZEALAND Castello37 Graben 31 GREECE Hills Library and Information Servior 28M1 Madrid A-1011 Wien IEM Private Bag 24, Ippoxamou Street Platis Plastiras New Market Libreria Internaional AEOOS BAHRAIN Athens-11635 Auckland Consell de Cert, 391 Bahrain Research and Consultancy 09 Bartcelona Assodates ld. GUATEMALA NIGERIA P.O. Box 22103 libreais Piedra Santa Universtly Press 1mited SRI LANKA AND THE MALDIVES Manana Town 317 Sa. Cale 7-55 Three Crowns BuildirngJericho Lake House Bookshop Zona 1 Private Mail Bag 5095 P.O. Box 244 BANGLADESH Guatemala City rbadan 100, Sir Ccittampalam A. Mia- Industries Development Gardiner Mawatha Assistane Sodety (MIDAS) HONG KONG, MACAO NORWAY Colombo 2 Hose 5 Road 16 Asia 20D lid. Narvemsen Information Center hanmondi R/Area 6 FI, 146 Prince Edward Book Department SWEDEN Dhaka 1209 Road, W. P.O. Box 6125 Etterstad Forsingle tiles: owloon N-002 Onlo 6 Fritzei Facklokaforetaget Brachfr4fi Hong Kong Regeringsgatan 12, Ba- 16356 Main Road OMAN S-10327Sockholh Maijdee Court INDIA MEMRB Informatron Services Noakhali -3800 Allied Publishers Private Ltd. P.O. Box 161& Seeb Airport Forl-ordrs: 751 Mout Road Muscat Wenergren-WilliamnsAB 76, KDA. Avenue Madrm-6(0002 Bo t 24 Kulna PAKISTAN S-10425S tockholm Bsedofer Mica Bok Agency BELGIUM 15JN.HerediaMarg 65. ShahrahQaaideAzam SWITZERLAND jean Detannoy Iallard Estate P.O. Box No. 729 Foriing tillsr Av. du Rol 202 Bombay - 400 038 Lahore3 Librairie Psyot 1060 Brussels 6, rue Grra" 13/14 Asaf Ali Road PERU Case postale 381 CANADA New Deli - 110 002 Editorial Desarrollo SA CH 1211 Ceeva 11 LeDiffiseur Apartdo 3824 CP. 85,151B rueArarp6e 17 ChittaranjsnAvene Lima Foraulariion order: Boucherville Qudbec Calcutta -700 072 librairie Payot J485E6 PHILIPPINES ServicedesAborements Jayadeva Hostel Building Intrnsatioal Book Center Case postale 3312 CHINA 5th Main Road Candhinagar Fift Floor, Filipins Life Building CH 1002 Lanuanne China Finanial & Economic Bangalone - 560 C. Ayala Avenue, Makai Publishing House Metro Manila TANZANIA , D. Fo Si DngJie 3-5-1129 Kachigud. Cross Road Oxford University Press Beijing Hyderabad -500L17 POLAND P.O. Box 5299 ORPAN Da Salaam COLOMBIA Prarthana Plat, 2nd Floor Palct Kulturyf Nauli Irlarlace Ltda NearThakore Baug Navrangpura CD-901 Warvawa THAILAND Apartado Aereo 34220 Ahmedabad-38000M Central Department Store Bogota D.E. PORTUGAL 316 Sila Road Patiala Horuse voria Portugal Bangkok COTE DIVOIR 16-A Ashok Marg Rua Do Carmo 70-74 Centre d'Edition et deDiffusion Lucknow - 226 01 12 lusban TRINIDAD & TOBAGO, ANTIGUA Africaines (CEDA) BARBUDA, BARBADOS, 04B .541 INDONESIA SAUDI ARABIA, QATAR DOMINICA, GRENADA, GUYANA, AbidonO4 Plateau Pt Indira Umited Jarir Book Store JAMAICA, MONTSERRAT, ST. Jl. Sam Ratulangi 37 P.O. Box 3196 KITTS & NEVIS, ST. LUCIA, CYPRUS P.O. BoX 181 Riyadh 11471 ST. VINCENT & GRENADINES MMER Information Services Jakarta Pusat Sytemat StiudiesUnit P.O. Box 2098 MEMRB Information Services #9 Watts Street Nicosa ITALY Bron.h off-i Curepe Licosa Canissiarraia Sansoni SPA Al Ala Street Trinidad, West Indies DENMARK Via Benedetto Fortint 120/10 Al Dana Ceter SarfundsLitteratr Casella Postale 552 First Floor UNITED ARAB EMIRATES RosaeoernsAlld i1 30125 lorence P.O. BoX 7188 MEMRB Gulf Co. DK-I9M0 Prederiksberg C Riyadh P.O. Box 6097 JAPAN Shrjah DOMINICAN REPUBIC Eastar Book Service HajiAbdUllah Alirra Building Editora Taller, C. porA. 37-3, Horgo 3Chmoote Bunkyoku 113 King Khaled Street UNITED KINGDOM Restarradd6n e Isabel la Catblica 309 Tokyo P.O. Box 3969 Microinfo Ltd. Apartado Postal 230 Doumman P.O. Box 3 Santo Domingo KENYA Altn, Hamrphire GU34 2PG Africa Book Servie (E.Al Ltd. 33, Mchammed Hassan Awad Street England EL SALVADOR P.O. Box 45245 P.O. Box 5978 Fusades Nairobi ]Wdah VENEZUELA Avenida Manuel EnriqueAraujo #3530 1brerisa del Este Edifio SISA,er. Piso KOREA, REPUBLIC OF SINGAPORE, TAIWAN, Aptdo. 60.337 San Salvador Pan Korea Book Corporation MYANMAR,BRUNEI Caracas 1060-A P.O. Box 101, Kwangwiaimun. Information Publications EGYPT, ARAB REPUBLIC OF Seoul Priva Ltd. YUGOSLAVIA Al Alram 02-061st FI, Pet-Fu Industrial Jugoloverska Knjiga AIGala Steet KUWAIT Bldg. P.O. Box 36 Cairo MEMR0 Information Services 24 New Industrial Road Tig Republike P.O. Box 5465 Singapore 1953 YU-11000Belgrade Tbrhiddle East Observer 8 CQawarb Street MALAYSIA Cairo University of Malaya Cooperative Bookahop, Limited P.O. Box 1127, Jalan Panta Barn Kuala Lompur 囫…”。”&B&&k 不 ISBNO一8213一1860一8