-Dr. Bijaya Jaishi

Series of interdependent activities applied on road (on carriage way) and on the roadside support (off road) to defer the rehabilitation to indefinite period is road maintenance. It is the main component of road asset management system. It saves additional vehicle operating cost for motorist, defers costlier repair and rehabilitation need, maintains the safety of the road, and mitigates the environment issues. It is reported that 1 unit of money spend on road maintenance saves 3 units to road users. Department of Roads (DOR) has been practicing two different types of maintenance contracts these days. The mostly used are Strengthened Maintenance Divisions (SMD) based Planned Maintenance and Performance Based Maintenance Contract (PBMC) that had been piloted in some projects in the past. But, the result of PBMC is not encouraging and department is reviewing on it.

 As per international standard, developed countries typically spend about 0.8-1% of GDP on road maintenances. But analysed data shows that DoR is using 0.1-0.15% of GDP in road maintenance in recent year. DoR has allocated about 6% of total budget for maintenance last year. It is far below the international practice. This low budget allocation is one of the main reason that only 60% of network is in good to fair condition, whereas DoR policy states above 95% of network should be in good to fair condition. It is high time for government to spend more funding for road maintenance. The maintenance strategy is show in figure below

In Strategy 1,huge rehabilitation cost required. It is not acceptable. In Strategy 2, Planned maintenance with reasonable investment defers costly rehabilitation. It is the DoR’s strategy. DoR has adopted “Planned maintenance” practice to keep its road safe, cost effective and efficient. DoR maintenance policy are; preservation and maintenance of road asset for full utilization, keep more than 95% of SRN in fair to good condition, minimum road closure and satisfaction to road users. The strategies on maintenances are; use of systematic approach for decision making within a consistent and defined framework, adopt consistent standards for maintenance, allocate resources effectively and review policies, standards and effectiveness of program on a regular basis.

Road board is the main agency responsible for funding maintenance activities in DoR. Road Board Nepal (RBN) receives fund from a fuel levy (Rs 3/litre for diesel and Rs. 5/litre for petrol) + 5% of new vehicle registration tax and some limited road tolls. The toll produces a relatively small amount of money with adverse publicity. The fuel levis are never deposited directly to the Road Board account. The fuel levis are collected in national treasury and later transferred to road board account. It is observed that only about 50% of the whole amount are transferred to RB account. The allocated total fund divided to SRN (70%) and LRN (03%). In last year, budget allocated for maintenance for SRN long with reserve fund is NRs. 6.51 billion. The budget forecast from Integrated Annual Road Maintenance Plan (ARMP) for maintenance is 26.04 billion. It is clearly found that there is significant funding gap. There is 95% deficit in funding, for proper road asset management in view of maintenance.

The availability of fund for the maintenance of SRN even after establishment of RBN remains a critical issue. Each year, even after increase of fund, the gap between need and allocated budget is too high about 70% in past years. Therefore, some other ways and means are needed to find alternative source of funding. There are three workable solution to overcome maintenance funding problem.

First, select the road in which potential public private partnership is possible, there is a provision of rehabilitation operation and transfer (RoT) provision in public private partnership and Investment Act (PPP act), 2075. Previous research has indicated that long term success of PPP projects largely depends upon effective risk management. Successful risk management strategies involves allocating risks through a contractual framework to these parties who are able to manage these risks better. In PPP act, there is also provision of Viability Gap Funding (VGF) which might be the milestone for implementation of PPP project in Nepal. The private party rehabilitate road, operate, collect tax and transfer to government after concession period. This might be the most promising one.

Toll system should be exercised in all national highway.  Tax can be added to spare parts, route permit, vehicle fitness certificate, license/renewal, tax on vehicle registered in foreign coming and entering Nepal. Other alternatives are land development tax, lease land of right way, revenue from auction of timber etc with right of way. In addition to funding issues, the other problems for road maintenances are; absorption capacity of organization, delayed decisions at various level, weak contract management, delayed budget approval from RBN, uneven work load in road divisions, delayed procurement and delayed tender evaluation.

Hence, there is a critical resource gap for maintenance of roads in Nepal. Ensuring alternative sources of funding and using fund efficiently and effectively can improve the maintenance quality of road. It is also time to start most promising method like PPP in road maintenance in line with international practice.