Saturday, January 16, 2021

Government plans cost recovery on roads

In the future that begins with the implementation of NDP 10, users may fund the maintenance of roads.

“For purposes of economic efficiency there is a strong case for charging users the full cost of maintenance through a system of user charges that should be phased in gradually with a view to achieving a full cost recovery by the end of NDP 10. In order to provide the Roads Department with a basis for multi-year planning of maintenance, the revenues from user charges should be “earmarked” to be used only for road maintenance, instead of being absorbed into general government revenues as is presently the case,” says the NDP 10 draft.
When it gained independence from the British in 1966, Botswana had next to nothing in terms of infrastructure and, over the years, has poured millions of pula into developing it.

However, the country may have reached a point where, as the draft says, “there should be a shift of emphasis from expenditure on new infrastructure, to maintenance and replacement of existing infrastructure.”

With particular regard to the road sub-sector, the draft suggests that since the national road network is largely in place and sources of funding are declining, during NDP 10 there must be shift in priorities from new construction to maintenance of the existing road asset base.

Road conditions surveys conducted in 2005 indicate that about 30 percent of the low and medium volume paved road network is in poor or very poor condition, and 22 percent of the high volume paved network.

On account of departmental labour being “notoriously difficult to manage efficiently”, it is suggested that during NDP 10, the use of such labour be phased out and replaced by use of contractors. In order to improve execution of maintenance, planners recommend the use of long-term performance contracts. Through that system, contractors would be paid for providing outputs based on a set of performance standards within an agreed budget, instead of paying them for providing inputs as is presently the case. The rationale for the latter is as follows: “This commits the contractor to providing a given level of service overran extended period and to bearing the associated risks. It also provides a contractual means of committing government to financing maintenance and so can help avoid the risk of maintenance of roads in question being underfinanced. During NDP 10 the use of this approach will be piloted through the proposed Botswana Integrated Transport Project to be financed by World Bank, with a view to its wider application in future.”

A properly maintained road infrastructure will be a boon to the tourism sector as it would improve access to key tourism areas. The sector intends to increase its contribution to the GDP from 5 percent to 10 percent by diversifying its products offering.

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