How the government plans to stop abandonment of expensive projects

The government on August 31 unveiled a strategic plan detailing how it intends to manage projects in the country amid growing concerns that a huge number of capital intensive projects that gobble up billions of shillings end up being abandoned.

 On July 20, President Uhuru Kenyatta issued a directive freezing all government projects until ongoing ones are completed with the government keen on maximizing on limited resources amid a shortfall in revenue collection.

Ministries, Parastatals and State agencies have been in the past accused of poor management of projects with quite a number of them ending up being white elephants.

For instance Kenya will from September 1, 2018 start paying the Lake Turkana Wind Power Project investors a whooping Ksh1 billion a month if the Kenya Electricity Transmission Company (KETRACO) does not connect the project to the national grid by August 31 as per the terms of the financing framework.

 Last year, audit firm Deloitte in a report, raised the red flag over the number of delayed major public and private infrastructure projects leading to cost overruns owing to ineffective management.

The report dubbed The Africa Construction Cost Trends cited cost and time overruns as the major reasons that lead to the abandonment of projects in Kenya.

 “Approximately 48% of projects report a cost overrun while 87% of projects are not delivered on time. This is largely attributed to inadequate initial contract periods that do not consider all factors resulting in time delays,” read the report.

Consequently, The Project Management Institute (PMI) on August 31 launched its first strategic plan that will govern the management of private capital and public projects.

The plan clarifies and widens the mandate of PMI to include influencing legislations on project management by engaging stakeholders as well as promoting research in planning and management of projects in Kenya.

The operationalisation of the SP will help the country embrace project management best practices, reduce project costs and schedule overruns.

 The strategic plan will also rein in on wastage in government as well as ensure accountability through the lifetime of a project.

 Speaking during the launch of the strategic plan, Transport, Infrastructure, Housing and Urban Development Principal Secretary Charles Hinga lamented a large majority of public projects end up stretching long past their projected completion dates and overshoot their budgets due to poor oversight.

 “The number of major capital projects that overshoot the initial budget or delivered late in Kenya is alarming. Projects are abandoned and we do not seem to be doing enough to change the tide. Infusing strategic, transparent, accountable and well thought out processes into any project sets it up for success.” Said PS Hinga.

PMI Kenya President Clement Kitetu said that the institute intends to influence the expedition of the enactment of a bill in parliament to establish the legal and regulatory framework for introduction of a project management course in Kenya.

“The single most important thing should be to help stakeholders understand the reasoning behind why a particular project is being undertaken for them to understand their roles and contribute to its success,”

“We have found out that when stakeholders are consulted and understand their roles the cost of a project comes down tremendously,” said Mr. Kitetu.