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High highway costs are reasonable: Ministry Secy.


Comments / 1782 Views / Tuesday, 6 January 2015 02:44


By Marisa Wikramanayake The construction costs for recent infrastructure development are reasonable and valid according to Ministry of Highways, Ports and Shipping Secretary R.W.R. Premasiri. Premasiri presented his figures and explanations to an audience of professional engineers and members of the media at a forum on infrastructure development held yesterday at the Cinnamon Lakeside Hotel, organised by the Sri Lanka Engineering Professionals Association.   He stated that the total cost of constructing the Southern Expressway with four lanes was Rs. 113.6 billion. The first stage in 2003 established the Kurundugahatekma to Matara section with two lanes at a cost of Rs. 8.7 billion and the second established a four lane road in 2005 from Kottawa to Dodangoda at Rs. 9.58 billion. The third stage, though initially intended to create a two lane section from Dodangoda to Kurundugahatekma for Rs. 8.29 billion in 2006, was then revised to create a four lane road for the same cost but only from Dodangoda to Pinnaduwa in Galle.      A loan from the EXIM Bank of China provided Rs. 18.70 billion to upgrade the Pinnaduwa to Matara section of road from two lanes to four lanes in 2009. The total cost came to Rs. 45.27 billion but there were further cost blowouts, increasing the final figure to Premasiri’s total of Rs. 113.6 billion. Premasiri stated that these were due to the addition of the electronic tolling system, construction of additional offices, the need to additionally stabilise the expressway in areas of marshy land, widening all bridges and culverts to four lanes, installing a CCTV camera system, restructuring the irrigation channels in the region to prevent flooding, the rise in costs of materials due to the post-tsunami construction boom, the increase in fuel and steel prices globally, compensation paid for property damaged during rock blasting and for land acquisition.   “When they compare our expressways to those in other countries like India or Kenya, they don‘t talk about the widths of the roads,” he said. “They don’t talk about what standards the roads are built to, or the fact that Sri Lanka’s geography is different and the country is smaller but that our land use differs so much that our people can and do live anywhere and not in specific areas and so they need more roads. The labour rate in India and Kenya is also lower – $1 per day compared to what would be around $10 per day for an unskilled labourer. India also makes its own steel – we don’t. And we can’t control the prices, we can’t control the world market.” He also stated that the extension of the Expressway from Matara to Hambantota had been agreed on with a 2014 adjusted construction cost of Rs. 199.7 billion and a total estimated cost of Rs. 239 billion and that it would be funded by the EXIM Bank of China.                     After his presentation, Premasiri then joined several other speakers on a panel including Ministry of Water Supply and Drainage Secretary Nihal Somaweera, Southern Highway Extension Project Senior Project Director R. M. Gamini, Outer Circular Highway Phase II Project Director N. K. L. Neththikumara, Ministry of Irrigation Secretary Ivan De Silva, Port City Project Director Susantha Abeysiriwardene, Airport and Aviation Authority Marketing Head Rohan Manukulasooriya and Government Medical Officers’ Association President Dr. Anurudhdha Padeniya. The panel was chaired by CodeGen CEO Harsha Subasinghe.   The panel answered questions from the audience on infrastructure development. Premasiri explained that the initial contract for the Colombo Katunayake Expressway was Rs. 11 billion in 2000 but was terminated in 2001 due to a lack of funds. Rs. 250 million was paid out as compensation to the contractor in 2004 and in 2007 the EXIM Bank of China provided Rs. 32.10 billion to build it. The final cost came to Rs. 41.2 billion as the expressway was built through the Muthururajawela Marshes and therefore required more complex stabilising structures. The additional costs were also due to creating canal systems to drain the marshes, adding new culverts to prevent flooding, and building two elevated concrete roads.           Neththikumara pointed out that you could not compare the two projects. “With the Airport Expressway, it cost more because we were working with marshy ground and it is built to last 50 years and is wider so it had to cost more,” he said. “There were 20 metres of peat in some areas.” There were also questions posed about the Mattala Airport and its capacity to generate income. “We have saved $15 million in costs by having a second airport,” said Manukulasooriya. “We can recoup the cost of building it in 14 years – we are now on direct routes from Australia to Europe and the Far East. Every single time, they fly over our airspace now, we charge them and that gets us Rs. 279 million a year. Why would you want to fly over the Himalayas and into Singapore instead of flying directly across? Now they can because the Mattala Airport is there.”   Abeysiriwardene also explained how the issue of erosion had been dealt with within the Port City development in Colombo. “The breakwater is five kilometres out and we know that the sand moves from south to north and if we just had the breakwater jutting out it would have made the sand build up on the southern side,” he said. “To preserve the natural effects of the sand movement and the beaches to the north, we put in cross sections in 2008 and in 2014 when we measured the impact, there was no difference. When we develop the Port City and start building, it will be within that breakwater, within that five km and the movement of sand will continue as normal next to it.”   Other topics discussed included the issue of figures at Hambantota Port that showed it wasn’t performing well. This was explained by the fact that the increase in the carrying capacity of ships limited the need for large numbers of ships resulting in smaller numbers of ships coming into ports across the globe with far greater carrying capacities for goods which isn’t always reflected in the data. Health was also discussed, with Dr. Padeniya pointing out that the healthcare system was developing well, that the public sector was always ahead of the private sector in the field in Sri Lanka and that what was needed more than anything else was an improvement in soft skills especially communication as well as a leader who understood the background to the Sri Lankan industry.   “We are now seeing the same problems that the West sees,” said Dr. Padeniya. “We have hospitals every two to three kilometres; what we need now is a leader who can listen to us as we implement cost effective strategies to reduce patient numbers, not someone who looks towards the West. We already do healthcare well here.” Premasiri also reminded the audience that what was not always understood was the fact that it often took four years from the start of a project to the start of the construction.   “You have to put aside nine months to find a consultant for the feasibility study, four months for the feasibility study, another consultant for the design takes nine months again while the design can take a year to a year and a half and after that to put the project out for tender might take more months,” he explained. “So in the meantime, in that gap of a few years, you have to make sure your costs don’t go up.”

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