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Inadequate management of investments in roads - Doc. no. 3:3 (2002-2003)

Poor estimates, unrealistic planning and redesign are important reasons why major roads projects have vastly exceeded their budgets in recent years. These problems have been exacerbated by the fact that the Norwegian Public Roads Administration has not had a suitable tool for financial management of construction projects.
Published 11/8/2002 2:00 PM

These are the main findings of the Office of the Auditor General’s investigation of the planning and follow-up of a sample of major roads projects (Document no. 3:3 (2002-2003)), which was submitted to the Storting on 8 November. The objective of the audit was to investigate the planning process, the project monitoring and the allocation of resources in connection with the Norwegian Public Roads Administration’s execution of major roads projects. The Office of the Auditor General investigated the following projects: “Trekantsambandet”, European road E16 from Aurland to Lærdal, national highway RV 555 from Nygårdstangen to Gyldenpris, European road E134 from Drammen to Mjøndalen and national highway RV 159 from Knatten to Vigernes.

The Office of the Auditor General’s investigation revealed that in some cases there did not appear to be any detailed estimates of costs at all. In addition, examples were found where the Local Development Plans for parts of a project were not approved until after the project was underway. In its comments, the Ministry of Transport and Communications said that it is important that projects are not promoted until the Local Development Plan has been approved and that estimates of costs are prepared on the basis of approved plans.

The audit revealed that several of the projects were subject to extensive redesign, often on the initiative of affected municipalities. In this context, the Office of the Auditor General pointed out the importance of good contact between the roads authorities and the affected municipalities in connection with major road construction projects. This is necessary both to ensure efficient planning and to ensure that other important social and environmental considerations are taken into account.

The Norwegian Public Roads Administration has not had a suitable tool for management and follow-up of construction projects. This was found to be a major problem in the five projects studied in the audit, although the Directorate of Public Roads has been aware of this problem for a long time. The Ministry of Transport and Communications agrees that the audited projects did not have good enough management tools and reporting routines in the planning and execution phases and is therefore going to continue its efforts to develop tools, management systems and expertise in these areas.

 

This report is available in Norwegian on the Office of the Auditor General’s website – www.riksrevisjonen.no – or can be ordered from the University bookshop Akademika, tel. +47 22 11 67 70.

Riksrevisjonen, Storgata 16, P.O. Box 8130 Dep, 0032 Oslo, Norway

Phone: +47 22 24 10 00

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