On Saturday 14 January a press conference was held in Ostrava on the subject of the “warping of Motorway D47.” After two months during which the Road and Motorway Directorate (ŘSD) and the Ministry of Transport had expressed their dissatisfaction with the construction work carried out by Eurovia exclusively through the media, the parties sat down at the negotiating table. The outcome is that a specialist commission is to be created and the ŘSD will look for foreign specialists, probably in Germany, who – as Transport Minister Pavel Dobeš put it – “know how to build a motorway network.” Jiří Konečný, a specialist in civil engineering, comments on events surrounding the construction of a transport infrastructure in an article for Czech Position.
I’ve got nothing against foreign specialists. However, the question arises why the public administration is supporting specialists from abroad at a time when qualified engineers in the Czech Republic are out of work because the construction industry is almost at a standstill. It is also worth asking why perfectly ordinary complaints regarding transport construction projects are being dealt with in front of the television cameras and a specialist commission is being set up so quickly. For the ailing Czech construction industry this is by no means good news, given that the public will conclude — wrongly — that we don’t have our own experts who are able to resolve the issue.
It is clear that communication has completely broken down over the last few months on the side of the state. The case of the undulating Motorway D47, as well as other cases before that, for instance the location of information signposts, in which Skanska was accused of carrying out poor work, clearly points to a theatrical attempt by the current political representation to draw the public into these disputes and to use the media to score political points. In order to understand in greater depth what is going on, we have to remind ourselves what has taken place in the Transport Ministry since the last parliamentary elections.
Care of the state
A year and a half ago, Vít Bárta of Public Affairs (VV) was put in charge of the Ministry of Transport. The now former minister, at that time at the peak of his popularity, lost no time in making personnel changes to the Road and Motorway Directorate (ŘSD), an organization receiving money from the state budget.
Although changing the management and regional directors of the Directive is common practice after every change of government, Bárta went much further than in the past. Specialists who for many years had been responsible for the preparation of investment projects and the implementation of construction work were laid off. People were put in their place who in many cases had never previously worked in the construction industry but whose presence was in the political interest of VV. Crucial to their nomination was not their expertise or experience, but simply their loyalty to the newly established system. Under the leadership of Public Affairs almost no large infrastructural construction work was set in motion
At that time the general public applauded Bárta, because at last someone was ready to sweep away the greedy concrete lobby and the corruption associated with the previous government. Several new faces have appeared at the head of the ministry since that time (Radek Šmerda and now Pavel Dobeš), though the puppetmaster pulling the strings (i.e. VV’s founder and paymaster Bárta) remains the same. However, some facts need to be stated.
Under the leadership of Public Affairs the department of transport has initiated almost no large infrastructural construction work. The official reason? Lack of money. It is true that VV were genuinely victims of the Ministry of Finance, which openly cast doubt on the policy of constructing infrastructure as an anti-crisis tool for stimulating the economy.
More for less
Czech Finance Minister Miroslav Kalousek (TOP 09) and his deputies are basically alone in this view in Europe. Most EU countries are increasing investment by the state in the transport infrastructure into order to compensate for a drop in orders in the private civil engineering sector. In this way they keep the construction industry, with its thousands of jobs, above water.
However, in the Czech Republic we are witness to a political power play in which the needs of the transport sector in the state budget have been deliberately damaged in association with VV. You only have to compare the differences between the funds approved last year and this year amongst the individual departments. The Ministry of Transport has faced an almost twenty percent drop in its funding, one of the largest year-on-year reductions.
What has the reorganization of the ŘSD contributed? The question of money is one thing. It is still possible to get things done with less money, though for this you need people in management positions who understand the issue at hand. This is the basic problem. And now we have an answer to the question why the ministry of transport is looking for foreign specialists for the Motorway D47. He clearly feels that he does not have the support of his subordinates and belives they lack the organisational skills and expertise to push the matter through to a successful conclusion.
This should come as no surprise, given that the conclusions of the expert opinions ordered by the ŘSD regarding the state of bridge construction are being publicly called into question by the leading experts in the field. The Directive was not even capable of repairing the crash barriers on the R46 between Vyškov and Olomouc through the whole of 2011. Instead of changing the retaining system it reduced speeds to 100 km per hour. Safety is of course the priority. But then why built a high-speed motorway at great cost if we are only able to travel along it at the same speed as on an A road?
A threatened sector
So who is being punished? Companies or individuals? At the start of his political career, Bárta let construction companies feel the pinch by squeezing the supply of state contracts. At first sight this was a reasonable measure — but not if it goes on for a year and half. Most large construction companies operating in the Czech Republic have gradually repositioned themselves in order to export construction work to surrounding countries, mainly to Slovakia and to a certain extent to Poland. Some have managed to penetrate more distant markets. There they will understandably build a new base for themselves and bring the minimum work capacity from the Czech Republic.
The result is that because of insufficient orders Czech construction companies have made substantial reductions to their workforce. They are reacting to a dramatic drop in turnover by simply cutting costs. Companies from the Big 5 have demonstrably reduced the number of employees by dozens of percentage points, close to 50 percent of the original numbers prior to the economic crisis in 2008.
Is it really advantageous for the state to take care of unemployed labourers, foremen, designers, construction planners, and thousands of other people working in related spheres such as hospitality or landscaping and forwarding companies, which are also dependent on large infrastructure projects? Is it really advantageous for the state to pay for the training of civil engineers who end up working in a different sphere due to lack of interest on the part of construction firms, which themselves are laying off their own qualified, experienced people?
Has the state thought about whether someone will be able to carry out engineering work in the transport industry in this country after several years, when the ministry is once again being managed responsibly and there is the political will to complete the missing transport infrastructure? It is time to stop scaring the public with the concept of a construction lobby and say aloud that the main parties being punished in this case are the state, which has to look after the unemployed, and the general public, which has to make do with an incomplete and obsolete infrastructure.
Insufficient funds no excuse
So what is the future? According to Václav Matyáš, head of the Czech Association of Building Entrepreneurs (SPS ČR), one of the main problems is that work is not continuing on the design of transport construction projects. This statement sums up the problems which this country will experience in the future. At present, the Directorate is not undertaking systematic design work, because its design activities have dried up in the same way as its construction activities. Insufficient time spent over preparation means we will have projects embarked upon costing several billion crowns and of marginal importance to society, such as making the River Vltava navigable for sightseeing boats.
Insufficient funds cannot be an excuse. The price of design work is nothing compared to construction work and the sums involved negligible as far as budgets are concerned. The preparation of the necessary investment and proprietary rights is also limping along. As a taxpayer, I fear a situation in which in a few months’ time the government will have to admit that the contract for the expansion by a few dozen centimetres of the Motorway D1 worth billions of crowns was not approved in Brussels and that the state does not have any large-scale, necessary construction work ready as backup.
Projects will probably be sought at the last minute so that we use up EU money quickly. Insufficient time spent over preparation means we will have projects embarked upon costing several billion crowns and of marginal importance to society, such as making the Vltava River navigable for sightseeing boats. In addition, in this case the Czech Waterways Directorate (ŘVC ČR) called a public tender in which, according to the media, there was only one bidder. The question of whether or not we really need such a project is pushed to one side, the main priority being that the project is up and running quickly!
It is well known that even if the Transport Ministry got its hands on some money, there will be nothing to be built with the exception of projects created and hitherto mothballed by Vít Bárta. However, the problem goes a lot deeper. If the next government manages to involve the private sector in the financing of construction projects through public-private partnerships and gets some large projects up and running, we will genuinely be obliged to look for specialists abroad. After such a deep slump in the construction industry the department will be lacking qualified construction managers, designers and other such professionals, all because of the ill-conceived approach of current politicians.
How is construction work undertaken abroad?
Instead of the media farce surrounding the location of signposts restricting speeds on the Motorway D47, the relevant civil servants should become acquainted with how construction work is undertaken during times of crisis in other countries. We don’t have to travel far for an example — Slovakia will do just fine.
The local government, despite the political instability of the coalition which culminated in premature elections, called five large motorway tenders. Prudently they retained those civil servants who had been active under the former government, and these are at present preparing public tenders using the design-and-build method (this method offers the customer a comprehensive service, from the selection and purchase of land, through the creation of architectural design documentation, to the implementation of the construction work and submission of the project for utilisation). Slovak investors understood that if they want to build a motorway economically they have to offer construction companies the possibility of optimising their technical solutions and adapting construction design work to technology.
The Slovak government is availing itself of the fact that supply is in excess of demand on the construction market during the economic crisis
The general principle applies here that what the state cannot manage the private sector will take care of easily. And lo and behold, the level of bids submitted by construction companies (including several Czech firms) is often in the region of 50% to 60% of the expenses estimated by the investor. To what extent the investor based its price specification on poor tender documentation and to what extent there was regular competition between contractors on the boundaries of profitability is not important.
What is important is the fact that the Slovak government is availing itself of the fact that at present supply outstrips demand on the construction market at a time of economic crisis, and has managed to create the conditions for genuine competition. Slovakia will thus create the necessary infrastructure under advantageous financial conditions, will draw down money from European funds, and will bring down the level of unemployment.
In a few years, when we are travelling around Slovakia on their new, cheap motorways, we might give a thought to our politicians and how they administered the country and created a motorway infrastructure here during the same period. I would be happy if, after the next elections, politicians didn’t simply use the media to pander to the general public, but listened to our specialists, called a spade a spade, and looked for the most advantageous solution for all concerned.
See related articles:
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Highway robbery: ŘSD money trail leads to Cyprus
Eurovia counterattacks over warped motorway
Czech transport minister spends quickly to demand more funds
Czech Transport Minister faces infrastructure abyss