Brussels (Brussels Morning) Compared to other parts of the world, development of EU transport infrastructure lags behind the US, Canada or Australia, a European Court of Auditors (ECA) report. has revealed
Of greatest concern, according to the ECA, is project implementation, with EU auditors citing delays as a matter of routine and the inability to complete an infrastructure project on time.
According to the auditors, EU strategic transport objectives such as completion of the Trans-European Transport (TEN-T) core network by 2030 have proved “overly ambitious” and are not always matched by real results.
A case in point is the objective of tripling the length of the EU’s high-speed rail network, which the ECA said is “unlikely” to be achieved by the deadline.
“The EU is trying to complete a comprehensive network of transport infrastructure across Europe”, Annemie Turtelboom, the ECA official responsible for the review, observed. “While in the past we considered cost-overruns and delays to be equal obstacles to achieving this goal, our comparison reveals that the EU is in line with other countries when it comes to costs, but performing significantly worse when it comes to delivering large projects on time.”
Cost-benefit analysis
The auditors also point out that proper cost-benefit analyses are not often undertaken at the project selection phase, with some projects cleared for award even though socio-economic costs are likely to exceed benefits, as happened, for example, with a section of high-speed rail in France.
The ECA also took note of discrepancies between estimated and actual costs of large transport projects in the EU, which it said result in an average budget overrun of more than 2 billion euro per project, or an increase of 47% on initial forecasts.
Nonetheless, the review allowed that cost overruns are not unique to the EU and that they affect transport infrastructure all over the world. In fact, the cost overruns affecting the reviewed EU co-funded transport projects are no bigger than the global average, insofar as the EU projects in question have yet to be completed.
Delays
However, the ECA finds that the delay factor is a singularly distinctive feature of EU projects when compared to similar ventures in other countries. Last year, EU auditors found that large transport infrastructure projects were affected by an average delay of around 11 years.
The review suggests that this is partly due to different – and sometimes conflicting – priorities between the EU and member states, the latter tending to focus on their national interests.
Cross-border projects
According to the ECA report, member states frequently neglect cross-border sections of projects where EU funds are focused. A case in point, Germany did not make a priority of constructing the cross-border northern access route to the Brenner Base Tunnel, even though the EU, together with Austria and Italy, had been investing in the project since 1986.
EU auditors suggested that the EU could learn from the US, Switzerland and Australia in terms of project coordination.
Moreover, the ECA urged member states to keep in mind that EU projects, once selected, can still be affected by many uncertainties. The need to obtain environmental permits and stakeholder acceptance also contribute to delays, the report noted.
Risk-based monitoring
The auditors highlighted systematic risk-based monitoring as one possible solution that could help to reduce delays — and cost overruns — in EU transport infrastructure projects. Such a mechanism exists in the USA, where projects identified as high-risk are subject to enhanced monitoring.
Projects whose cost increases by more than 2% in any one year against their estimated budget, for example, require more detailed reporting by the project promoters to the government authorities and this requires increased supervision by federal managers.
Systematic monitoring
Finally, the auditors concluded, there is no legal obligation within the EU to conduct systematic analyses of financial results once a project has been completed – i.e. evaluations of large transport projects.
Only once has such an evaluation been carried out, and that was in 2007, when the focus was solely on financial indicators, including the absorption of the available EU funding.
In contrast, the US, France and Norway take a different approach, systematically carrying out ex-post project evaluations.
