Audit report slams LRT delays and cost overruns

The most recent report from the Commission of Audit (CA) released yesterday added to previous criticisms of construction delays and budget blowouts in the construction of Macau’s Light Rail Transit (LRT) system.

In the report, the CA noted that until December last year, the only construction said to be complete was that related to the Taipa line.

The route is 9.3 kilometers long and represents, according to the CA’s calculations, only 44.3 percent of what was initially planned to be built within this time, meaning that the construction rate of the project was less than 50 percent of what had been projected.

On the other hand, regarding the Peninsula line, the CA noted “only preliminary works on the Barra Station were started.”

The CA also noted that at the end of 2016, the Transportation Infrastructure Office (GIT) had made new plans for the construction of the LRT, at the time outlining a total of 11 routes to be built in the short, medium and long term. However, the report said, “five of the 11 routes predicted [to be completed in] the short term will only be concluded, in the best case scenario, by 2026. As for the date of completion for the remaining short and medium term projects, the schedules for these have not yet been defined.”

Additionally, there was also criticism of cost overruns, with the report noting that back in 2007, “it was forecasted that for the first phase, the LRT would cost some MOP4.2 billion, however, in September 2012 the budgeting costs rose exponentially to MOP14.3 billion.”

Delays and inaction from authorities were also noted in the report. On the administrative aspects of the project, the CA noted the government’s announcement that in June 2016, the GIT would be extinct and replaced by a private company to be established in 2017, and that the company would be in charge of coordinating all LRT operations. However, until July this year, “the company had not yet been created.” Instead, the government decided to hand over the preparatory works for the Taipa line center of operations (in 2019) to another company on a five year contract, which will cost some MOP5.9 billion.

The CA also noted the GIT’s faults in the approval of requests for the extension of construction periods to contractors, and failure to strictly observe the laws for inspections and timely procedures.

In the opinion of the CA, these flaws not only contributed to the constant “unjustified” delays to construction, but also budget overruns, pointing the finger at the GIT and their analysis and judgement of several requests from contractors, many of which were unjustifiable, as well as failing to enforce existing laws for timely reports on incidents that might have caused delays to construction.

Citing several examples of particular situations where CA said that the GIT acted wrongly and caused delays to the construction, one situation related to the lack of coordination of preparatory works was of note in particular.
The CA recalled a delay in the assignment of the worksite, due to the installation of a yard related to another public service.

In this case, “the GIT issued a letter requesting the removal of the construction only four months after the starting of the works, impacting its progress by about a year,” the CA said, adding, “although the site for the works was clearly not in a condition to be assigned, the GIT had signed the corresponding consignment order and had subsequently authorized the extension of the deadline for that yard. This shows that the GIT was not proactive in coordinating the preparatory work.”

The CA called on the GIT to promptly address the recommendations of the report and take measures to prevent them from reoccurring. RM