[Part 1] Why is maintaining roads hard?

Thinking beyond corruption and incompetence

This is Part 1 of a multi-part series covering why maintaining roads or infrastructure is a hard public policy problem and innovations in contract management and digital solutions that have seemed to help Ministry of Rural Development and NHAI.

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While the privileged class can hide behind enclaves and the optionality of private services to escape most public service failures, it cannot yet do away with the need to move. While it can exchange overfilled trains for slightly busy check-in lines at the airport, it still needs to use the same pothole-ridden roads as the rest. Sure, roads in better parts of the city are sometimes better maintained, but there are many contrarian examples in favour of uneven roads as class levellers where even high-profile parts of the cities or highways are found in poor condition. If class solidarity is not able to fix roads, then there must be either larger powers at play that ensure poorer roads, or maintaining infrastructure is indeed a hard problem.

Attribution CC BY-SA: https://www.flickr.com/photos/joegoauk73/42440150895

The political economy of roads and contractors is a dinner table conversation at family meetups where the men argue passionately “ki sab mile hue hai” while the women clean dishes and put the kitchen back together after the meal, hoping a similar nexus existed with their partners in this economy of maintaining social relations and household chores. As I do in those situations, I aim to steer clear of dismissive and reductive attitudes that blame everything on the political economy.

What if, with all good intentions on all sides, maintaining roads is intrinsically or rather administratively a hard problem? Beyond intentions, does it require reform?

To understand that, we first need to understand how roads are built. Typical road construction contracts are item-based, i.e., there is little creativity upfront on how to make a road. A road that is proposed to meet certain traffic can only be built in a certain way if costs are to be optimized. The load-bearing strength of the existing soil, the estimated traffic projected for a decade, and some other objective parameters available on the site decide the thickness of various layers that make up a road. Each State has a statement of rates (SOR) which dictates the cost of labour, construction materials like bitumen or sand and machinery like road rollers. Based on the design and the SOR, the state government comes up with an estimate for the road, which includes a set margin for the contractor as profit. The competition is among contractors on who can forego a higher margin.

During construction, payment is usually made as the road is constructed and reaches milestones, or on a monthly basis. The contractor submits bills claiming the volume of work done. As roads are constructed in layers, their length, width, and depth are measured physically to determine the volume of work done in that particular layer, which is then multiplied by the rate approved in the statement of rates. Whether it is a milestone-based contract or a monthly billing contract, the number of bills is limited, and each is of a significant amount. When a bill is raised by the contractor, the government engineer responsible for processing the bill must generate and record adequate evidence to demonstrate their satisfaction that the work has been completed and that payment can be made. This requires careful attention and exposes them to future audit scrutiny and vigilance in case norms are not followed. Having processed payments within the government myself, I know it is a meticulous task. The government engineer will typically conduct tests and calculations to verify the claims made by the contractor. This may involve digging a pit on the road to check the thickness of different layers that make up the road to validate the quantities being claimed. This evidence is then documented in a manner that would satisfy any auditor in the future that adequate care was taken by the engineer before processing the payment. If the contractor submits bills months after the actual construction, the engineer can dig a pit and assess quantities. The same holds true if a third-party or government auditor visits at a later date; they can dig a pit and verify whether the bill was processed correctly or if undue public money was paid to the contractor. Due to the risks involved, the entire exercise of validating and processing bills typically represents a high administrative burden.

So, in summary, road construction has:

1. Fixed Design and Predictable Work

2. High ticket bills

3. A low number of bills (Max = Months of Construction ~12-24 months)

4. Easy to prove work done as expected (dig a hole, check thicknesses are as per design or not)

5. Proof remains intact for future scrutiny (dig a hole again, probably get the same answer)

What about road maintenance?

Well, road maintenance has two components: periodic renewal and routine maintenance. The former is when a new layer is put on an existing road due to wear and tear, and the latter involves routine tasks such as filling potholes or cracks, clearing shrubs growing on the side of the road, refixing road signs, or kilometre stones, etc. Routine maintenance is basically maintaining the road, giving monthly care so that the life of the road is elongated, and daily commute is easier. Unattended cracks become potholes, unattended potholes get bigger and expose lower layers of the road, which once filled with water can shift subsurface layers enough to cause more potholes or even cave-ins. The point being, roads require routine/regular care on a daily/weekly basis, and routine maintenance is key.

But how does a typical item-rate contract look for routine maintenance of roads? There is no exact science or estimate on how much material and labour will be needed to maintain the road over a typical 5 year contract. The cost estimate for fixing a pothole is easy once it has formed. But it is difficult to estimate the exact cost of maintaining a road simply because you can't predict the number of potholes you'll get. Typically, contracts are made with an upper limit as to what amount can be paid to the contractor on an annual or monthly basis. This amount is very small compared to the cost of construction. The maintenance contractor is expected to raise regular monthly bills based on the number of potholes they repaired, cracks they filled, and the material and labour involved in clearing the shrubs that grew on the road. Once submitted, the government engineer has to visit and verify the work (similar to construction) and process the payment. If the engineer delays vetting by a month, new deformities would have arisen, or shrubs grown back, or kilometre stones missing. This would make it difficult to assess the work done by the contractor. Even if the engineer vetted everything on time and found it satisfactory, an auditor visiting the road at a later date can find newer deformities formed after the engineer's vetting and accuse the engineer of corruption and processing bills when work is incomplete. Hence, it is a risky proposition for the engineer as well. Further, if the contractor doesn't raise a bill, it also reduces the engineer's incentive to inspect the road, leading to a situation where while no undue money is paid to the contractor, the road remains pothole-ridden, and the public suffer.

In summary, what are the characteristics of road maintenance?

1. Difficult to estimate work needed and depends on external factors (sudden rains, farm water spillage, heavy trucks, etc.)

2. Low ticket bills

3. A high number of recurring bills (60 bills over a 5 year period)

4. Difficult to prove work (not) done if inspections are not done on-time

5. Difficult to prove work was done upon future scrutiny

From the point of view of the government engineer, not only is processing a maintenance bill hard and a risky endeavor, but it also requires them to assess things on time and regularly without fail. This is to be read in the context of poor state capacity (government officers in the field are overburdened and under-resourced) and time and again are given tasks that are unrelated to their primary duties. Related Read is below:

The Cost of Innovation

Compounding matters, any grease that lubricates the system and makes it function is also limited due to the low-ticket nature of the bills being processed. Knowing well that bills aren’t getting cleared on time, the incentive for the contractor to maintain the road also reduces and they can focus on bidding on construction contracts in the locality which there has been no dearth of lately.

Therefore, there is a need to simplify, de-risk and unburden maintenance. Many initiatives have been taken in this direction in the road sector and there are learning at-large for other infrastructure domains which are afflicted by similar problems.

In the next two posts: I’ll cover initiatives taken by the Ministry of Rural Development for rural road maintenance and National Highways Authority of India for highway maintenance. Both initiatives are a mix of contractual and meaningful digital innovations.  Stay tuned and subscribe to be notified 🛣️

[Part 2] Why is maintaining roads hard?

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