Fixing the loopholes

The IMF has released its technical assessment report titled ‘Public Investment Management Assessment’ (PIMA), evaluating Pakistan’s development framework.

It has concluded that the country’s Public Sector Development Program (PSDP) is in need of reassessment as the average project completion time stands at 14.1 years.

Thus the Rs727 billion allocated in 2022 for the PSDP will now require Rs10.7 trillion to complete the already sanctioned projects. According to the Planning Commission, however, a typical project requires two–three times its estimated cost.

Cost and schedule overruns in infrastructure and defence projects was a global phenomenon for decades, mainly because of lack of tools and techniques to provide early warning about cost and schedule overruns. Current project monitoring and evaluation tools lack this ability, thus corrective action cannot be taken in time.

Faced with undesirable delays and cost overruns particularly in defence projects, the US replaced the 60-year-old project/programme evaluation and review technique (PERT) with a new programme/project management concept known as earned value project management (EVPM).

The EVPM, which is based on statistical principles and has now been made mandatory for all infrastructure and defence projects/programmes in the US and the EU, allows prediction about cost and schedule within 20 percent of project time. Thus, for a five-year project, fairly accurate cost and schedule estimates can be made within 12 months of the project’s initiation. There are other over half a dozen indices indicating the project’s health within 20 per cent of project’s time.

Thus, there is ample time to take remedial measures to keep the project on track. All present project management monitoring tools lack this vital ability.

In August 2008 when the EVPM was being adopted as a project tool worldwide, the Planning Commission released ‘Guidelines for Project Management’. This detailed document referred to use of project monitoring and evaluation software (PMES) and emphasized on results based management (RBM). There was no mention of EVPM concepts.

Fifteen years later, the IMF is now pointing out the almost non-affordable PSDP in terms of cost and schedule overruns.

In Pakistan, the EVPM was introduced by various management training institutions using the software ‘Primavera’. The EVPM was, however, never taken seriously as a subject by colleges, universities, the Planning Commission, the PEC, or the HEC.

This neglect has resulted in the waste of billions of rupees in public-sector projects, besides denying the public at large timely benefits of their tax money.

It is time the IMF report be taken seriously; it should form the basis of immediate reforms in subjects of management sciences in universities. There should be the mandatory adoption of the EVPM for all major projects including infrastructure and defence industry.

Let’s not waste time disputing the IMF report, fixing blame, justifying cost overruns and inordinate delays and finding an ad-hoc solution. Billions of rupees have already gone down the drain. Let us adopt tools and techniques which have been successfully implemented the world over with excellent results. The EVPM not only ensures completion of projects on time and within budget, but people also start receiving the benefits of their taxes in the shortest possible time.

The writer is a freelance contributor and can be reached at: miansalimuddin@gmail.com