Uganda has joined the Construction Sector Transparency Initiative (CoST) as its fifth member from Africa, giving Ugandan construction companies better opportunities to participate in large construction projects and increasing transparency in the countrys construction sector
The 10-member CoST initiative was set up to make governments, the construction industry and civil society organisations commit to creating a more transparent and accountable public construction sector. The initiative aims to reduce mismanagement and inefficiency in the construction sector, fight corruption, and improve value for money spent by tax-payers worldwide.
"There are benefits to the local construction industry from ensuring that there is a level playing field, because material project information is made openly public," said David Luyimbazi, director of planning at the Uganda National Roads Authority (UNRA). "The improvement of the professional standards within the sector is a potential benefit of this initiative and an important factor that will increase the credibility of local companies."
Ugandan construction companies will be represented on a multi-stakeholder group formed as part of the CoST initiative, and should expect to compete more favourably with large, global construction companies due to improved access to information.
"For providers of finance (loans), investors and insurers of the construction sector, the benefits will relate to mitigation of perceived political or reputation risks, which in turn can have an impact on credit risks," Luyimbazi added. "And for civil society in Uganda, the benefits come from improved access to information on construction projects and enhanced accountability increased participation in the governance of the construction sector, improved prospects for better quality and value for money projects for beneficiaries."
Uganda follows El Salvador as the second country to join CoST this year. Luyimbazi said, however, that the arrangement would ideally by led by the Office of the Auditor General or Inspectorate General of Government.
"The construction sector is wider than just the roads sub-sector as it includes all other infrastructure like hospitals, dams, real estate, railways and airports. The AG and IGG’s offices have an oversight role very much related to ensuring value for money, and their mandates are written into law and would ensure compliance by all government bodies involved in construction," he said.
Luyimbazi explained that the UNRA was taking the lead only "in the interim" due to commitments made by the government of Uganda to the World Bank under a US$200mn credit agreement for the Transport Sector Development Project (TSDP) to implement a Governance and Accountability Action Plan (GAAP).
"This requires compliance with the COST principles. The need for the GAAP followed the procurement capacity assessment of UNRA in 2009, which determined the procurement risk then as substantial. So the government committed UNRA to implement measures to improve transparency and accountability amongst which is the subscription to COST, implementation of Independent Parallel Bid Evaluation and establishment of a Contract Management System," Luyimbazi noted.
"Our subscription to the COST initiative takes us two thirds of the way through what we committed ourselves to do to improve governance and accountability in the sector."
Uganda joining the global initiative was announced at Uganda's Joint Transport Sector Review (JTSR) event in Kampala, to participants who included central and local government officials, private industry, academic institutions, NGOs and the media, among others.
Since CoST was piloted 2009, the African countries that have joined the initiative before Uganda are Malawi, Tanzania, Zambia and Ethiopia. The other countries are the UK, Guatemala and the Philippines.
In Ethiopia, the CoST Assurance Team recommended the adoption of an alternative design for a 33km rural road, which saved an estimated US$3.7mn on the one project alone. In Tanzania, the CoST team was able to draw attention to the need for investment in additional capacity to improve performance and financial management.
The pilot was funded by the UK's Department for International Development (DFID), and ran from 2008 to 2011. The CoST international programme, funded by the World Bank, was launched in 2012.
According to a CoST statement announcing the initiative launch, in addition to monetary advantages, CoST is also crucial in ensuring better outcomes for citizens and communities, as well as for the government and private industry.
The statement read, "For example, the road designers in Ethiopia were suspended for two years by the Ethiopian Roads Authority for the actions highlighted by CoST, ensuring that standards will rise in the future."
Speaking at the launch in Uganda, CoST deputy chairman Bekure Ketema Gebremariam, who is also a member of the Ethiopia Multi-Stakeholder Group, welcomed Uganda to CoST and expressed hope that two more members would join by the end of 2013.
Gebremariam remarked, "I am delighted to welcome Uganda to CoST. With 10 countries now on board, we are in a position to show that CoST really is a global phenomenon, and that it creates genuine and measurable impact. I have no doubt that Uganda will have a crucial role in moving the programme to the next level."
Simon Kaheru
