Provincial projects blowing initial budgets
'Once you start a job, unless it's astronomical, you would finish it,' says Pat Darrah
CBC News
Posted: Jul 22, 2011 7:52 AM AT
Last Updated: Jul 22, 2011 8:46 AM AT
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New Brunswick taxpayers have little choice but to continue paying for government projects that are routinely exceeding their original budgets, according to one construction industry official.
Construction crews are working around the province on a series of infrastructure projects from highways to courthouses.
Work is continuing on these projects even though many of them are coming in way over budget.
The One Mile House Interchange in Saint John is now estimated to cost $75 million, roughly 70 per cent above the government's initial estimate.
Similarly, a sound-dampening barrier next to a Fredericton neighbourhood is going to cost $2.3 million, up from an original forecast of $1 million.
Pat Darrah, a member of the Saint John Construction Association, said governments must do a better job estimating the cost of construction projects. (CBC)Pat Darrah, a director with the Saint John Construction Association, has been in the construction business for 55 years.
He said he always adds 20 per cent, and as much as 25 per cent, to a project's first estimate.
He said he never believes the initial cost of a construction project.
"Once you start a job, unless it's astronomical, you would finish it," Darrah said.
"You never get halfway into a job and quit."
There is no shortage of examples of projects that have blown their initial cost estimates in recent years.
Former premier Bernard Lord announced a new courthouse for Saint John during a byelection in the city in 2005.
The expansion of the Saint John Regional Hospital's emergency room cost $8 million more than originally budgeted. (CBC)Without even an artist's drawing, the former premier said the project would cost between $25 million and $30 million. That courthouse project now has a budget of $53 million.
The former Lord government also estimated the new Moncton courthouse would cost $28 million. That facility opened earlier this year and carried with it a hefty pricetag of $59 million.
Courthouses are not the only infrastructure projects that are adding additional costs to the cash-strapped province.
When The Moncton Hospital's new $47-million ambulatory care facility opened, its final bill came in $16 million more than first budgeted.
Moncton's new courthouse was supposed to cost $28 million but the final tab was $59 million. (CBC)Similarly, the Saint John Regional Hospital's $40-million emergency room expansion project came in $8 million over budget.
The cost overruns of these smaller projects pale in comparison to the Point Lepreau Nuclear Generating Station's refurbishment project.
The refurbishment project was expected to cost $1.4 billion, but it is three years late and it is estimated to be $1 billion over budget.
The overruns of these provincial construction projects are adding considerable costs to a provincial budget that is already stretched thin.
Finance Minister Blaine Higgs has ordered all government departments to find internal savings and cut expenses. The Progressive Conservative government is attempting to curtail the $448-million budget deficit.
The string of projects surpassing their stated budgets is a cause of growing concern with the province's NDP.
NDP Leader Dominic Cardy criticized the government for failing to control these expenditures.
"Why is our government not capable of producing a cost estimate that is even vaguely accurate?" he said.
One department has had some success in finding savings.
The Department of Transportation has reported the tenders for some of the province's road construction projects have come in under budget this year.
But instead of saving that money, Transportation Minister Claude Williams has said the department will find additional projects to invest that money.
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