Poor implementation of public projects continues in 2019

Aug 22, 2019 News

Despite an increase in spending this year, the Coalition Government is continuing to battle implementation of public projects.
In recent years, the result had been that tens of millions of dollars budgeted was not spent because projects were not awarded in time.
In its mid-year report of the economy, the Ministry of Finance has highlighted the problem, which has even seen department heads and ministers meeting at the State House sometime back to figure out ways to improve implementation.
“The implementation rate of the (Public Sector Improvement Programme) PSIP remains a concern for the Government, despite the increase in capital expenditure in the first half of the year, as bottlenecks in project execution and implementation still exist,” the mid-year report said.
The report highlighted problem areas, such as the paucity of critical staff, including engineers, and procurement-related issues.
With regards to the latter, the completion of evaluation reports at the procurement stage was a major problem.
The Coalition said it has taken steps, including reforming its implementation units,“…and has already put mechanisms in place to combat some of the existing bottlenecks, including emphasising criteria-based project selection for public investment, the introduction of detailed project concept notes in budget submissions, and improving the ABCs for better planning, implementing and monitoring of the PSIP”.
The administration said it is convinced that these interventions, collectively, should improve the quality of investments being undertaken and their preparedness for implementation.
“Notwithstanding the improvements to public investment management, Government is cognisant of the varying institutional capacities across the public sector. In light of anticipated additional revenues, increased economic activity and wider regulatory and service delivery demands, this presents a risk to ensuring effective budgeting, spending and value for money.”
Already, the government said it has mandated all budget agencies to accelerate institutional strengthening, going forward.
The report also stressed that notwithstanding the projected growth for 2019, the attainment of revised targets could be undermined by domestic and external risks.
“The pace of implementation of the PSIP, the ratio of non-performing loans to total loans, political uncertainty, and the influx of immigrants, represent some critical internal threats. At the same time, a slowing global economy amid weak investment, exports, and consumption are among the major risks coming from outside our borders. Other risks include, but are not limited to, climate change, enforcement of key legislation, data availability and quality.”

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