Identification of Factors Affecting the Overrun of Costs in Rural Road Projects: A Study Based on Sri Lanka

Abstract

 This study focused on identifying the main factors affecting cost overruns in rural road projects and ascertaining their various economic and social implications from policy perspectives. In addition to the secondary data, a structured questionnaire was used to collect primary data from the 30 senior engineers, and interviews were carried out with many stakeholders involved in these rural road development initiatives in Sri Lanka under the iROAD project. Multiple regression, correlation analysis, and rank agreement factor methods were used to identify and check the significance and ranking of the main factors affecting phases of contract procurement and the project implementation for cost overruns in rural road development. This study found positive relationships between the awarded contract value, the engineer’s estimates, and the cost of km length, and altogether 43 factors were identified and ranked by looking at their importance under the five categories: technical, economic and financial, political and regulatory management, project resources, and project implementation environment. The methodology used and the policies derived from this study can be applied to other similar projects to ascertain the factors affecting cost overruns in rural road projects and to find policy recommendations to minimize this problem in any country, specifically for South Pacific countries, including Papua New Guinea