Going Forward from Uganda 2010 : What Strategies for Road Management and Financing?

1. Going Forward from Uganda 2010 : What Strategies for Road Management and Financing? By Kingson Apara SSATP Team Leader

2. Theme: Management and Financing strategies for transport: Moving beyond the Road Maintenance Initiative (RMI) focus.Chair: Samuel Nengue, President, ARMFADiscussion Leader: KingsonApara, World BankPanelists:Ist and 2nd Vice Presidents of ARMFA, Bruce Thompson, Mike Pinard, Fred Addo-Abedi –CEO, Rwanda Transport Board;

3. Reminder-Strategic Direction:Overall Goal of DP2: “Transport Policies and strategies contributing to regional integration, poverty reduction, and economic growth” Theme 2, Road Sector Management – DP2 Logical Framework Output:“Effective institutional and financial arrangements adopted for safe, reliable, affordable and accessible road transport services and infrastructure”

4. Achievement of DP2 Logframe Output: DP2 Achievements: Good practice examples of “Effective institutional and financial arrangements have been adopted” in some countries through the establishment of: -second generation road funds in 27 countries, -17 road agencies, -new financing instruments for road maintenance, -abolition of force account in most countries-institutional reforms to streamline sector management in most countries-commercial management principles in a few countries….. BUT

5. …….. BUT A road only partially travelled by all countries: Safe, reliable, affordable and accessible road services and infrastructure remain an issue in all countries, and vary from one country to the other.

6. Key message to ministersAchieving Safe, reliable, affordable and accessible road services and infrastructure remains a major issue in all countries. Political support and advocacy are critical to broaden the resource base and pursue the reforms to improve the coverage and quality of our roads. Lesson Learnt To advance the agenda on achieving Safe, reliable, affordable and accessible road services and infrastructure, there is need to balance the quest for financing with effective results on the ground in program delivery, by:

7. Promoting management efficiency through improved monitoring and evaluationStepping up advocacy for policy reforms and more resource mobilization, ensuring data availability to support analysis and decision makingDisseminating good practices Establishing standards as a reference to which countries can aspire to improve performance Strengthening continental institutions

8. Establishing standards to help countries in decisionmaking and to enablecomparisonsacross countriesImplementìngmeasures to increase national resources in favor of roadsStrengthening the capacity of continental organisations like ARMFA, AGEPAR, ASANRA, etc.Promotingresearch and innovation

9. Going Forward: Is commercialized road management the answer? Suggested Points of Discussion (1) Road construction is a business: • should be managed on internationally recognized commercial lines; • owes its existence to the quality of its products • attracts investors only if financially viable (ROI) • Has an owner; the investor (public, private or community) • The owner defines policies and is responsible for success

10. Suggested Points of Discussion (2) The road is a commercial product: • has a value (asset); • undergoes depreciation • has a price (to the beneficiary), cannot be given out for free • should be depreciated, accounted • is produced (constructed), managed, maintained, protected and renewed (reconstructed) • fitness for user should be the overriding purpose (cost, time, comfort, health and safety, environment, etc.)

11. Suggested Points of Discussion (3) Broaden national resource bases: • Extend “User pays” principle to “Beneficiary pays” principle? i.e. recognition that the road benefits everybody not just its direct users ? • Apply cost recovery or “beneficial pays” principle on all road types, regardless of volume? • Depreciate newly constructed or reconstructed roads? How? • Use depreciation retentions on maintenance and rehabilitation? Or invest ? Where? • Sustainable Financing: What does it mean? How can it be achieved?

12. Suggested Points of Discussion (4) • Routine maintenance is a management function-Should its cost be treated as variable overhead costs? • How should the “Fitness for user” principle be systematically applied in road designs • If road management focus is on efficiency and productivity, what does this entail? Should road management be outsourced (i.e. change of status of road agencies) or should key staff of RAs be recruited on contract? • Economic viability: Is it being applied? Where and when?

13. Suggested Points of Discussion (5) An independently administered country Road Index (CRI) to rank countries by performance, for promotional and advocacy purposes • Awards for excellence: recognition for leading (good practice) results • Continuing improvement prizes –recognition (incentive) for progress-also to be managed independently • Results framework to guide country/Regional dialogue • is it relevant or a priority?

14. Suggested Points of Discussion (6) • What else is critical? • Simplified and affordable tools to collect, analyze and compare data; Is RONET the answer? • Readily available data on country road sector profiles and performance-AICD? How? • Sustainable financing of data requirements; how? • Regional Roads Associations in driver seat; How? • Continued research and innovation; on what? Who by: how? • Partnership building between continental organizations; For what? how?

15. The Next Important Step • Training in RONET? • Where for Anglophone audiences • Where for Francophone Audiences • Who are the first trainees? • What are the conditions?

16. Thank you very much