11 December 2012

Nigeria: Federal Roads Still Dilapidated Despite Allocation of N1.4 Trillion in 12 Years

Amid growing complaints over the poor state of federal roads nationwide, it emerged yesterday that the National Assembly has appropriated about N1.414 trillion for the road sector alone in the past 12 years.

However, a large chunk of the funds appropriated for road rehabilitation are not released, going by the testimony yesterday from the Minister of Works, Mr. Mike Onolememen, when he appeared before the House of Representatives Committee on Works.

Chairman of the House committee, Hon. Ogbuefi Ozomgbachi, who gave the details of the appropriated funds for roads in the last 12 years, lamented that the state of the roads had not reflected the quantum of investment the Federal Government had made in the sector over the years.

Both the minister and Ozomgbachi spoke Monday in Abuja at a public hearing on the urgent need to address the collapse of federal roads nationwide.

According to Ozomgbachi, of the 34,400 kilometres of the federal road network, only about 35 per cent is paved and a substantial percentage of the road network is in varying degrees of distress.

Ozomgbachi decried the condition of the roads and called for a concerted effort by the government and the private sector to maintain existing roads and build new ones.

"In a country of about 160 million people, with an approximate land area of 910,768sq km, in which over 90 per cent of the passengers and freight movement are done by road due to almost non-functional waterways and rail transportation, the situation assumes a status of national emergency.

"The debilitating effects on the national economic growth and loss of lives and properties arising from road accidents and armed banditry arising from the poor state of our road network evoke a sense of national outrage and mourning," Ozomgbachi said.

He described the state of the roads as a "critical national emergency" that must be tackled seeking the appropriate legal and institutional framework for road infrastructure and more innovative funding options.

Onolememen attributed the poor state of the roads to the poor release of funds from the budget by successive administrations.

He explained that the financing of road projects has been hamstrung by fluctuating budgetary provisions which has proved inadequate to meet the target.

He said although the amount being owed on the interim certificate for the Lagos-Otta highway was about N1.74 billion, only N742.5 million was provided in the 2012 budget to settle the debt.

"This (partial release of budgeted fund) often leads to delays and abandonment of road projects across the country. From past experience, budgetary provisions were not fully released.

"In 2011, out of a budgetary provision of N130 billion for highway projects, only N88.7 billion was released with a shortfall of N41.3 billion. In 2012, out of a total budgetary provision of N143 billion, only N110 billion was released.

"The average budget of about N100 billion for road development is grossly inadequate for the nation's 35,000 km of federal roads and for a country that budgets N300 billion and N150 billion for its central bank and the Nigeria Deposit Insurance Corporation (NDIC) respectively.

"What is needed is about N500 billion yearly in the next four years to fix the country's ailing road infrastructure and bring it in sync with road infrastructure development in other thriving nations in the world," he said.

According to him, the ministry has recommended alternative ways of funding highway infrastructure to the Federal Government for approval.

The recommendations include the adoption of annuity contracts for key arterial routes; borrowing from multilateral agencies and pension fund for key highway infrastructure; floating of road bonds for highway projects; viability gap funding through the proposed Road Fund; and implementation of the five per cent fuel surcharge.

Others include the imposition of tolling charges on haulage companies and conventional public private partnership (PPP) finance for road infrastructure.

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