World Bank queries RDA on over-procurement

World Bank queries RDA on over-procurement
Written by Chiwoyu Sinyangwe and Mwala Kalaluka
Tuesday, June 16, 2009 3:01:59 PM

WORLD Bank country manager Dr Kapil Kapoor has confirmed that the bank has queried the Road Development Agency (RDA)'s significant over-procurement of road projects in 2008.

But Dr Kapoor said it was not true that the World Bank had withheld its support to the Lusaka-Chirundu road rehabilitation project in view of the clarifications it is seeking on the over-procurement by the RDA.

In response to a press query, Dr Kapoor said the query was part of the regular consultations between the government and the donors to ensure delivery of investment in the country's road sector. However, Dr Kapoor did not indicate the overshot budget that donors to the country's road sector had queried RDA over.

"As you know, the investment requirements for the roads sector are substantial and, going forward, it will be especially important to ensure that significant investment takes place in rural roads to enable rural communities to be connected to markets," Dr Kapoor stated.

"For this reason, the World Bank and other cooperating partners regularly engage government in a dialogue on public expenditures in the roads sector... this is routine part of the Road Sector Investment Programme (ROADSIP) process. During the most recent reviews held a few weeks ago, it was observed that RDA had entered into contracts whose value exceeded its annual budgetary allocations by a significant amount. We therefore sought clarifications regarding this matter."

Dr Kapoor said the RDA over-expenditure might have to do with the fact that expenditures in the roads sector were multi-year in nature.

"Therefore, what we have seen are expenses that go beyond one year," he stated. "We would like to make sure that road sector finances are sustainable and excessive commitments do not result in accumulation of arrears. We have therefore agreed on a collaborative review process going forward and are working closely with the concerned government agencies and ministries to clarify this matter."

Dr Kapoor said the donors were hopeful that the result of the review and the reconciliation of expenditures would help the government increase effectiveness of investment in the roads sector in the future.

RDA chief executive officer Erasmus Chilundika said the over-procurement issue arose from the fact that donors believed that there was a figure of about K1.5 trillion that was outside the 2008 budget, which was about K1.3 trillion.

Ministry of Works and Supply permanent secretary Lieutenant Colonel Bizwayo Nkunika said the situation was not an over-procurement but an issue of advanced procurement, which the RDA should be commended for.

But Dr Kapoor said the World Bank had not withdrawn funding to the Lusaka-Chirundu pending the results of the query.

He announced that the World Bank was in the process of finalising negotiations dates, after which the project would be presented to the Bank's board for approval

"During the past several months, we have been working closely with various government agencies in appraising the Lusaka-Chirundu road and this process is nearing completion," stated Dr Kapoor.

"It was only a few days ago that the environment clearances and the associated disclosures were received from Environmental Council of Zambia...it is therefore not true that the Bank is withholding support for this project, which is important component of the Road Sector Investment Programme."