Improving infrastructure spending to fight poverty!

The provision of a $2 vaccine to save a child’s life for many is an important and obvious thing to support. But sometimes what is less obvious in saving that child’s life is how important the road is that was used to deliver the vaccine, or the electricity that powered the fridge to store the vaccine at a cool temperature. These were also essential for that vaccine to be able to save the child’s life.

In the developing world living without access to roads or electricity can mean living without decent education, evening lighting, or medical supplies. It can mean the difference between life and death.

Infrastructure is vital for development. However in Sub-Saharan Africa the infrastructure deficit is huge: 70% of the population has no access to electricity, 95% of agriculture is without irrigation and the majority of the rural population are not served by roads to market and hospitals that are passable year round. However infrastructure doesn’t come cheap and the sector is notoriously complex; this can lead to mismanagement and increase the potential for corruption.

In a 2010 report “Africa’s Infrastructure” the World Bank predicts that the cost of addressing the basic infrastructure deficit in Africa would require an additional $45billion a year in infrastructure investments. However in the same report the Bank notes that mismanagement, inefficiencies and corruption increase this cost, and $17-15 billion could be saved by addressing these problems. Elsewhere Global Construction Perspectives estimate that loses through mismanagement, corruption and inefficiencies range between 10 – 30% in the construction sector.

Recognizing: (1) the immediate need for significant investment in African infrastructure and (2) the potential for mismanagement of public finances in this sector; ONE’s Executive Director Jamie Drummond spoke at the international launch of the Construction Sector Transparency (CoST) Initiative this morning.

The CoST Initiative seeks to increase transparency in the construction sector to ensure better use of public resources. There are 8 national level CoST initiatives that work with governments, civil society and construction companies to develop systems and procedures to enable the public disclosure of project information, thereby making construction projects more transparent and open to scrutiny. This transparency and accountability can help ensure money is well spent and can decrease the opportunities for corruption.

For example in CoST’s pilot stage following the public scrutiny an intervention by CoST Ethiopia led to the redesign of a road project which is expected to lead to a cost saving of $2.3 million. This $2.3 million is now available to invest elsewhere to achieve development goals. It means $2.3 million out of the hands of corrupt individuals but instead being used to train more teachers, build more schools or buy more medicine.

“The Construction Sector Transparency Initiative (CoST) is a fantastic initiative that ONE is proud to support. Transparency in the construction sector, from the financing to the decision making stage, is crucial in allowing the public to hold decision makers to account. Thereby ensuring water pipes, electricity lines and roads, reach and improve lives as they were designed to do.” Jamie Drummond

Over the coming year the CoST Initiative will be expanding out to more countries. Working with local civil society, companies and governments ensure the best use of public finance in the construction sector. ONE will be continuing to support this work and you can find out more about the Construction Sector Transparency Initiative here.