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Northern Road Connectivity Project ROAD SECTOR ANALYSIS

ASIAN DEVELOPMENT BANK

ADB Loan RSC-C92207 (SRI): Northern Road Connectivity Project

FINAL REPORT

Amal S. Kumarage University of Moratuwa Moratuwa

31 st March 2010

NORTHERN ROAD CONNECTIVITY PROJECT- ROAD SECTOR ANALYSIS

A Geographic and Demographic Profile

1. The Northern Province Connectivity Project (ADB Loan RSC-C92207) targets improving connectivity between the Northern Province (NP) of Sri Lanka and the rest of the country as well as improving mobility within the province. The NP has been subject to severe socio-economic disruptions due to armed conflicts over the last three decades. Improving connectivity with NP could lead to its re-integration with the rest of Sri Lanka and the improvement of the economic conditions of both the NP as well as that of the rest of the country, since the north has a high potential for trade and transport with other areas.

2. The NP is so called as it is located in the northernmost part of Sri Lanka and is in fact just 35 km from the southern part of India. It is connected with the Indian mainland by a mythical Adam's Bridge across the shallow Palk Strait. The NP has a land area of 8,884 square kilometres. The province is surrounded by the Gulf of Mannar and Palk Bay to its west, the Palk Strait and India to the north and the Bay of Bengal to the east. Forty percent of the coastal belt of the country falls within the NP. Its land boundaries are the Eastern, North Central and North Western provinces to the south of NP.

3. The NP is predominantly covered in tropical forest with numerous rivers that flow through them. The province is divided into two distinct geographic areas i.e. the peninsula and the . The is irrigated by underground aquifers fed by wells whereas the Vanni has irrigation tanks fed by perennial rivers. The province also has a number of lagoons, with the largest being the Jaffna lagoon. Most of the islands around Sri Lanka are also to be found in the western seaboard of this province. The largest of these islands are Kayts, Neduntivu, , Pungudutivu and Mandativu. The seas off the NP as well as its lagoons are fertile fishing grounds. Besides these, the province also boasts of a variety of natural resources such as agricultural lands, mineral deposits, wet lands and beautiful beaches.

4. The Northern Province tends to be hot and dry from February to September and moderately cool and wet in the wet season which spans from October to January. The province's climate is tropical with average temperature being around 28º to 30º. Relative Humidity varies from 70% during the day to 90% at night. The NP receives its rainfall from the northeast monsoon from December to March and to a much lesser extent from the southwest monsoon which spreads from June to October. However the NP is a dry zone province receiving approximately 1250 mm of rainfall annually.

5. The Vanni is divided in to four administrative districts namely Kilinochchi, , Mannar and Mullaitivu. With Jaffna, there are a total of five administrative districts in the province which in turn is administered as 33 Divisional Secretariat (DS) Divisions and 912 Grama Seva (GS) divisions covering a total of 2,939 villages. The province has 27 Pradeshiya Sabhas, one Municipal Council and four Urban Councils as local government institutions.

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6. Till the end of 2006 the NP was merged with the Eastern Province and known as the Northeast Province. Most areas of the province were not under direct control of the Government for the past 3 decades.

7. As per the Census carried out in 1981 the population in the province was 1,109,404.The estimated population in 2007 was 1,311,776. The population of this province, like that of the Eastern Province has been heavily affected by the conflict. According to the last census carried out in 1981, the provinces’ racial composition was made up of 92.0% Tamils, 3.2% Sinhalese, 4.6% Moors and 0.2% others. In the same year the religious profile was recorded as 77.5% Hindus, 14.2% Catholics, 4.9% Muslim 1 and 2.3% Buddhists. But both ethnic and religious compositions have varied drastically during the period of conflict.

8. Majority of the people living within the province at present earn their livelihood as farmers, fishermen or professionals in the civil and business sectors. Small scale industries such as chemicals, light manufacturing, cement and textiles had been in operation prior to the conflict but are now not functioning.

9. The Northern Province’s share of the national GDP is around 2.9% and has recorded a per capita income of Rs 109,530 (approx USD 960) in 2008. While it is one of the lowest in the country at approximately half the national average, it also has recorded one of the lowest GDP growth rates 2 in the country. Table A.1 summarizes several geographic, demographic and economic features of the province. It is noted that is also one of the provinces, along with North Central Province having the lowest population density in the country.

Table A-1: Geographic and Demographic Details of Northern Province North ern Feature Sri Lanka Province Area (sq km) 8,884 65,610 Road Density(km/km2) 0.48 1.5 Population (mn) 1.041 18.750 Population Density (persons/sq km) 117.2 296 GDP (Rs bn), 2008 128 4411 Per capita income (2008, SLR/year) 109,530 218,161 Agriculture (rice), Manufacturing, Plantation Primary Industries Livestock, (Tea, rubber, coconut), Fisheries tourism, Garments Source: Central Bank, Sri Lanka

10. With the Government taking full administrative control of the entire province from May of 2009, the foundations are now being laid for the rapid development of infrastructure within the province following the clearance of anti personnel mines which is nearing completion. One of the key short term needs would be to assist the returnees displaced by the conflict to speedily rebuild their economic and social systems. Many of them are keen to return to their original livelihoods and communities. In this respect the availability of reliable road and transport connections will be necessary to ensure that the desired resettlement occurs. Delays in providing adequate transport links especially between rural and urban areas is likely to curtail access to health and education, thus leading lead to concentration of people in urban areas making them poor and unemployed while rich agricultural areas may be left unattended. Furthermore, depletion of rural population could slow down provision of other services such as water, sanitation, electricity and telecommunication all of which require a minimum density of population to serve effectively.

1 Department of Census & Statistics, 2001 Census 2 Central Bank of Sri Lanka, Provincial GDP-2007 11. As per the physical plan prepared by the National Physical Planning Department, Jaffna city will be developed as the northern metropolis with an anticipated population of 1 million. Mankulam located in the centre of the province is to be developed as the administrative capital. Vavuniya, Mannar, Kilinochchi and Mullaitivu are to be connected by a road network which will provide easy access to markets for commodities produced in the hinterland. Mannar is expected to be developed as an Entreport to the Asian sub continent through the proposed construction of a land bridge to India making the NP the gateway to South Asia.

B Provincial Road Network and Traffic Volume

12. The road network in Sri Lanka is classified into national, provincial and local authority roads according to their functionality and management. While the National Roads are managed by the Central Government through the Road Development Authority, the provincial road network is managed by the respective Provincial Councils (PC). A Provincial Road Development Department (PRDD) has been set up under the Provincial Ministry of Infrastructure to administer the network of provincial roads in the NP. The roads of the different local authorities are managed by the respective Pradeshiya Sabhas, Urban Councils and Municipal Councils most of which are yet to be established in the NP after cessation of hostilities.

13. The road network within the NP by length of road under each level of road administration is given in Table B-1.

Table B-1: Road Network in Northern Province km length km length % of network

in NP in Sri Lanka in NP National Roads (A and B Class) 1,271 11,671 10.9 Provincial Roads (C & D Class) 1,960 15,532 12.6 Local Government Roads (E Class) 5,600 64,659 8.7 Total 8,831 91,862 9.6

14. The A9 is the most important national road that runs north-south from to Jaffna. It connects Kandy to Jaffna through several important regional centres outside NP such as , and . It also serves as the only road that connects the NP to the rest of the country. Moreover the A9 is also the most important road that connects the regional centres within the province such as Jaffna, Vavuniya, Mankulam, Paranthan and Kilinochchi. The A9 along with the A32 which runs along the western coast from Mannar to Jaffna and A34 and A35 which connects Mullaitivu located on the eastern seaboard to the A9 at Paranthan and Mankulam respectively are the other important regional roads.

15. In an attempt to strengthen connectivity by road to the NP from the south, an alternative route is being developed by improving the Padeniya-Anuradhapura road and the roads between Padeniya and the proposed expressway network. This will reduce existing travel time between Jaffna and from 10 hours to 7 hours. Moreover, construction is on going to improve connectivity to the east by improving the road between Mullaitivu and and by reopening the road between Mannar to Puttalam via Wilpattu.

16. The majority of these and other roads in NP are currently in a dilapidated condition as there was no proper maintenance or rehabilitation during the last three decade. Furthermore a substantial portion of coastal roads were badly affected by the tsunami in 5

2004. Some of these tsunami affected roads are being rehabilitated with foreign assistance, especially from the ADB.

17. The Northern Railway line when it was fully operational provided good connectivity to all major town centres other than Mullaitivu. However with the break out of armed conflict in the area the rail tracks have been completely dislodged while many structures including bridges and stations destroyed. The train presently operates to Vavuniya and proceeds to Omanthai just 13 km beyond Vavuniya. The Talaimannar line branching out from has also been completely dismantled. The Governments’ Uturu Mituru program to restore the line to Jaffna has commenced with local donations and Indian assistance. It is envisaged that with the restoration of the rail track, the once popular rail travel between Colombo and Jaffna would once again be restored especially since travel time is expected to reduce to 6 to 7 hours by intercity express. Steps are also being taken to restore the connection to Mannar from Medawachchiya.

18. Provincial roads are entirely situated within the province and thus provide an important link between the national roads and town centres to rural agricultural production areas. These roads form an essential part in providing the rural-urban linkages within the province served by scheduled bus services and goods transport vehicles.

19. At present the provincial road network comprises of 855.25 km of gravel roads and 1104.75 km of metalled and tarred roads on which there are approximately 60 bridges, 4,000 culverts and 120 other road assets. However, around 90% of the length of these roads is reported to be in less than satisfactory condition, resulting from the accumulated maintenance during the period of conflict. In fact it was observed that most of the metalled and tarred roads in Killinochchi and Mullaitivu Districts have deteriorated to such an extent that they have become gravel roads. Moreover almost all these provincial roads have originally been intermediate lane roads with 4-6 metre wide carriageways, but due to edge deterioration and other defects and are left with 3-4 metre wide surface areas at present.

20. Almost all the existing metalled/tarred roads are macadam based and only a few roads that have been rehabilitated in last few years have been upgraded to gravel primed DBST roads and more recently to ABC- DBST.

21. Presently special attention is given to the rehabilitation of 5,600 km length of rural roads under the Uthuru Wasanthaya program of the Government . In addition to this there are an estimated 2,000 km of roads belonging to the Irrigation Department and other government agencies which are also used as public thoroughfares.

22. Table B-2 summarizes the present condition of the road network in the NP by surfacing type and lane width.

Table B-2: Condition of Roads in Northern Province % of Length by Road

Category Type of Surface Condition Total Km Good Fair Poor National (No updated records on surface types) 1271.00 10% 20% 70% Provincial Gravel/Earth (Intermediate Lane 3 4--6 m) 855.25 10% 15% 75% Metalled &Tarred (Intermediate Lane 4--6 m) 1104.75 10% 15% 75% Total 3231 .00 10% 17% 73% Source: Road Development Department, Northern Province,2008

3 Classified as Intermediate Lane by PRDD, but currently having less surface width due to deteriorated state 23. In 2007, the estimated fleet of motorized vehicles in the Northern Province was 70,141 accounting for 3.2% of the fleet in the country. Though the traffic growth has fluctuated with the level of conflict, the two-wheeler and three-wheeler fleet has grown steadily over the last decade. This indicates that the population is gradually becoming motorized by acquiring low cost private modes of transport. This province due to its intense agricultural nature also has a higher percentage of land vehicles. Around 95% of the vehicle fleet is made up of these three types of vehicles.

Table B-3: Vehicle Fleet in Northern Province, 2007 Fleet Vehicle Type NP % of Sri Lanka Omnibuses 538 3.4 Private Coaches 398 1.6 Dual Purpose Vehicles 1,255 0.7 Private Cars 1,418 0.6 Land Vehicles 4,177 4.5 Goods Transport Vehicles 1,916 1.1 Motor Cycles 57,258 5.1 Three-wheelers 2,864 0.8 Others 317 5.5 Total 70,141 3.2 Source: Central Bank, Sri Lanka

24. Most of the national roads in the NP carry motorized traffic of less than 2,000 vehicles per day 4. In the case of provincial roads, most of them carry less than 200 motorized vehicles at present. Most of this traffic is made up of two or three wheelers or military vehicles. On the other hand, non-motorized traffic, especially bicycles volumes are high on these roads and often surpass the total motorized traffic. The typical average speeds on the national roads are between 20 to 40 km/hr while that of the provincial network are in the range of 15 to 30 km/hr.

C Road Sector Assets Management

25. As was mentioned above, the National Roads are managed by the Road Development Authority (RDA) of the Central Government, while the Provincial Roads are managed by the Provincial Road Development Department (PRDD) of the province. Since the institutional arrangements, policies and procedures are different and the roads are separately administered, they shall be discussed separately hereinafter.

C.1 National Roads

26. The Road Development Authority (RDA) is a statutory body under the Ministry of Highways and Road Development incorporated under the RDA Act No.73 of 1981. The RDA is the premier highway authority in the country and is responsible for the maintenance and development of the National Highway Network, comprising of the A Class Trunk Roads and Main roads (B Class) It is also responsible for the planning, design and construction of new highways, bridges and expressways that are required to augment the existing network from time to time.

27. The RDA is managed by a Chairman and a Board of Members appointed by the Minister in charge of Highways with a General Manager as its Chief Executive Officer. The General Manager is assisted by 6 Additional General Managers and 14 Directors to carry out the RDA’s different functions.

4 TransPlan Traffic Estimation Model, University of Moratuwa, 2008 and field observations, 2009 7

28. The Director (Maintenance Management & Construction) of the RDA directs and co- ordinates the execution of (a) maintenance of roads, (b) maintenance of bridges, (c) light rehabilitation and minor improvement to roads using domestic funds, (d) improvements to weak bridges with local funds on National Highways and (e) rehabilitation and improvement of minor roads and bridges on request. The Provincial Director (RDA) of the Northern Province is supported by 3 Chief Engineers and 6 Executive Engineers (EE) operating from their respective regional offices located at Jaffna, Pallai, Vavuniya, Mannar Mullaitivu and Kilinochchi.

29. EE offices of the RDA employ their own labour force and machinery for both routine and urgent maintenance work. But periodic maintenance work is awarded to contractors selected by tender. Foreign funded projects of the RDA that are channelled through the Ministry of Highways & Road Development are handled by Project Directors and Project Management Units (PMU) set up under them.

30. The National Roads selected for inclusion under the Northern Road Connectivity Project (NRCP) are namely the B268, B437 and a section of A32 located in the Jaffna EE division. The selected road sections of A9 (Dambulla- Galkulama) and A20 are however wholly located outside the NP and are maintained by the EE office in Anuradhapura.

31. The A9 and A32 are two roads that are considered as the primary roads connecting the Northern Province to the rest of the country. Both these are being designed or constructed at present with assistance of different foreign funding organisations. The section of A9 between Rambewa to Punewa was rehabilitated under funding from SIRUP and World Bank . The section of A9 from Punewa to Thandikulam has been divided into 3 sub-sections and is presently being rehabilitated using funds from the CAARP project of the ADB. The remaining sections of the A9 namely from Rambewa southwards to Galkulama and from Thandikulam northwards to Jaffna are currently in design stage to be implemented under the Uthuru Wasanthaya Program. The rehabilitation of the A32 has also been initiated under Stage 1 of the Uthuru Wasanthaya Program. It includes rehabilitation of the road from 17km to 108 km.

C.2 Provincial Roads

32. The Provincial Road Development Department (PRDD) in the NP is responsible for the construction, maintenance and administration of the provincial road network. It is headed by a Provincial Director who works directly under the authority of the Secretary of the Provincial Ministry of Infrastructure.

33. Three of the five Chief Engineers in the PRDD are assigned for the execution of regional works in Jaffna, Vavuniya and Killinochchi districts respectively. Each Chief Engineer is supported by two Executive Engineers in the execution of road works in their respective districts. The CE in Vavuniya supervises two districts through the EE’s located in Vavuniya and Mannar. The other two Chief Engineers posts one of which is currently vacant are responsible for Planning, Design & Quality Assurance functions. At present he PRDD does not have offices in Kilinochchi and Mullaitivu districts. In-fact the Head Office is still located in Trincomalee in the Eastern Province where it was located when there was a North Eastern Province. .

34. Since the PRDD does not have its own direct labour force, the routine maintenance and rehabilitation works are contracted to local contractors. In addition, the PRDD maintains a special unit for machinery and equipment for deployment under Advance Account for road improvement works on provincial roads. Generally the PRDD hires out these machines to local contractors engaged in maintenance work who do not have their own machinery. 35. In the NP, a number of foreign funded road rehabilitation programs for provincial roads such as NECORD, STAART and CAARP projects have been implemented by the Central Government with the active participation of the PRDD. A total of 12 km of provincial roads affected by the conflict were rehabilitated under CAARP in Mannar during 2004/05. Similar amount of road length was rehabilitated under NECORD in Vavuniya and Mannar Districts during 2007/08. During the period of 2005/06, STAART project rehabilitated approximately 20 km of road length affected by the tsunami which were located on the eastern coast line in . It can however be seen that in spite of these projects, less than 50 km from a network of around 2,000 km has been rehabilitated over the past 3 years.

36. Unlike in several other provinces, there is no current involvement of the Ministry of Provincial Councils and Local Government in the monitoring of foreign funded provincial road development projects in the NP. On the other hand, the Uthuru Wasanthaya Program implemented by the Ministry of Nation Building has invested LKR 150 mn in 2009 for the provincial roads in Vavuniya CE division to bring conflict affected roads into motorable condition.

D Road Transport Regulation and Industry

37. The Provincial Councils were established in 1989 under the 13th Amendment to the Constitution. However due to the unsettled political situation in the north, the Northern Provincial Council was never set up. In the interim, the administration of the motor vehicle fleet was done by the Provincial Commissioner of Motor Traffic under the Chief Secretary. The regulation of omnibus transport within the province was made possible through the National Transport Commission which has bestowed powers to the Government Agents of the respective districts within the province to issue permits on behalf of the Commission and to carry out other administrative functions.

38. There are a total of 592 valid route permits for intra-provincial bus services within the province issued by the respective Government Agents. These are in addition to the 96 buses belonging to the Sri Lanka Transport Board, which comes under the Ministry of Transport of the Central Government and hence not issued route permits. Besides this there are 67 buses which have been issued permits for inter-provincial services starting from or ending at towns within the province. However services to destinations north of Medawachchiya are just resuming after disruptions due to the conflict. It is anticipated that there will be around 200 inter-provincial buses operating mainly to Colombo, Kandy, Trincomalee and Batticaloa by the end of the year. The Uturu Mituru program to rebuild the railway to Jaffna and to Kankesanthurai has commenced and scheduled to be completed by end of 2010. The railway presently operates 5 passenger trains daily to Vavuniya of which 2 are intercity express passenger services which take around 6 hours.

39. The National Transport Commission provides financial reimbursements to 9 dedicated rural bus services within the NP under the ‘Gami Saeriya’ program. This program provides a subsidy for the regular and reliable operation of un-remunerative bus services through certification of delivery and attainment of standards monitored by a local user committee. These provide important connections between rural and town centres within the province. These services are expected to be significantly increased this year.

40. There are no regulatory provisions as yet for other transport services such as school vans, three wheelers or taxis operating for fee or reward within the province. Therefore, most of these para-transit services continue unregulated. Two-wheelers, Three-wheelers and hand tractors are also used extensively for both goods and passenger transport as are small trucks and vans. Three Wheelers of which there are nearly 3,000 vehicles registered within 9 the province, provide passengers services within town areas and in rural areas, especially where regular public transport does not operate or after such services cease in the evenings.

41. Trucking is deregulated and there are independent small scale operators most of whom have other businesses. They usually provide different capacity two axle vehicles ranging from 2 tonnes to 10 tonnes. Rates are competitive.

42. The issue of annual revenue licenses for motor vehicles registered to addresses within the province and the collection of such revenues is carried out by the Provincial Motor Traffic Department. The department does not have legal authority to perform new registrations or transfer ownership of vehicles which is handled by the Commissioner of Motor Vehicles under the Central Government. Bicycles are the most numerous type of vehicle in the province.

E Provincial Road Revenue and Expenditure

E.1 National Roads in NP

43. The National Budget allocates funds for the RDA through the votes for the Ministry of Highways and Road Development under two different expenditure categories labelled Recurrent and Capital. The Treasury allocates such funds for national roads through the consolidated domestic fund and foreign funding sources. Domestically funded recurrent expenditure provides for personal emoluments, travelling expenses and for the maintenance of capital assets and services.

44. Maintenance Funds: In October 2005, the Cabinet approved to set up a Road Maintenance Trust Fund (RMTF) under the provisions of the Trust Ordinance. However the provisions for this were made only through the budget for 2007 and its operations begun in January that year. It was expected that the fund would be transformed in to a dedicated second generation road maintenance fund later. According to the Road Sector Master Plan 2007-2017, the estimated budgetary requirement for road maintenance for 2007 and 2008 was SLR 4.50 billion and 4.70 billion respectively. But actual allocation was only SLR 3.41billion (75.7%) and 3.70 billion (78.7%) respectively.

45. The RDA carries out its periodic and routine maintenance by allocating funds to their divisional offices according to the road condition assessment made by the Executive Engineers of these divisions and the output from RMBEC road maintenance estimation software programme. However the RDA always complains that the full allocation for maintenance cannot be used since the Treasury does not release the agreed cash imprest on time.

46. Capital Funds: New construction, improvement and rehabilitation work of national roads are funded by allocations provided to the RDA through the Ministry’s Capital Expenditure allocation. These Capital allocations are based on project proposals that are submitted to the Treasury which have been included in the budget. Such projects are funded either entirely through domestic funds or with foreign funding with counterpart domestic funds.

47. In the case of funding projects, there is no particular pipeline for road sector projects. Projects are chosen mostly based on prevailing political expediencies. Large scale domestically funded projects and foreign funded projects however are usually mentioned in the budget speech or through announcements of cabinet approvals granted, thus officially declaring such projects as policy decisions. Allocations coming under the Maga Neguma Program are currently confined to upgrading of rural roads and even though such allocations come under the Ministry of Highways, the RDA is not the implementing agency of such work programs.

48. Over the last 5 years, the majority of the capital funds spent on the national roads in the NP was facilitated through the SIRUP (Small Infrastructure Road Upgrading Project) and the STAART (Sri Lanka Tsunami Affected Area Recovery and Take-off) projects. In the case of the SIRUP project, funds were used for improvement and widening work. JBIC funds under the STAART project were used to rehabilitate a considerable length of coastal roads affected by the tsunami in December 2004.

49. The provincial road sector in the NP is also funded from central government funds, foreign funds and provincial revenues. Of these, the major source of funding for the PRDD is the Block Grant and Province Specific Development Grant (PSDG) allocated by the Central Government through the Financial Commission to the respective provincial budget.

50. Block Grant : Recurrent expenditures such as salaries, transport and maintenance of assets of PCs are covered by these block grants. The Chief Secretary gets the majority of its recurrent budget under block grants from the Central Government. For the road sector this includes salaries, overheads and an allocation for recurrent maintenance which in addition to other assets includes a significant portion for road maintenance.

51. Provincial Specific Development Grant (PSDG): These are capital grants provided for identified and agreed development priorities in the sectors of infrastructure, health and education etc. The Finance Commission has authority to supervise the progress of the performance of the PCs in these projects prior to releasing these grants. PCs do not have provision to deviate from the grant utilization guidelines provided by the Finance Commission.

52. Criteria Based Grant: This is a grant provided by Treasury to PCs based on socio economic parameters. This grant is then allocated by the PCs for capital expenses of all new and on-going projects of PCs. The majority of these grants are generally utilized for acquisition, rehabilitation & improvement of fixed assets such as vehicles, buildings & machinery etc. This has not been provided for the provincial roads in NP for the last 5 years.

53. The PRDD by being a department is unable to utilize any earned revenue for either capital or maintenance work. Only exception to this is that the revenue earned from hiring machinery being used for road maintenance.

F Capital Expenditure

F.1 National Roads in NP

54. The financial investment on national roads for improvement and widening over the last several years has mainly come from the SIRUP project.

Table F-1: Utilization of Road Sector Capital Funds, RDA Rs Million Source 2005 2006 2007 2008 2009 SIRUP (Small Allocation 70.0 301.8 192.0 195.0 406.6 Infrastructure Road Expenditure 18.4 199.7 161.1 135.1 343.8 Upgrading Project) Utilization (%) 26.2 66.2 83.9 69.3 84.6 Source: Planning Division of Road Development Authority

55. In addition to this the JBIC funded STAART project has invested for the rehabilitation of tsunami affected roads in the Western, Southern and North Eastern Provinces. This 11 project has spent Rs. 30.3 mn Rs.50.3 mn and Rs. 52.3 mn for the years 2005, 2006 and 2007 respectively for the national roads in Northern Province.

F.2 Provincial Roads in NP

56. Capital Expenditure for improvement and rehabilitation of the provincial roads is provided through the Provincial Sector Development Grant (PSDG) based on a work program submitted by the PRDD and as agreed to by the Finance Commission. Presently this includes (a) repair of road structures, culverts and small bridges etc (b) construction and repair of retaining walls and (c) surfacing with DBST (earlier with primed gravel now with ABC) usually done in sections of 500 metres at a time and costing around Rs 10 mn per km.

57. As these capital funds are also used for repair, very little funds are left over for rehabilitation. For example in 2008, the PSDG allocation for Vavuniya CE Division was Rs 60 mn. It was only possible to rehabilitate 6 km of road length during this year.

58. During the period 2005 to 2008 there had been no funding provided through Criteria Based Grant or Matching Grants for the NP as in other provinces.

Table F-2: Utilization of Road Sector Capital Funds, NP Road Development Department Rs Million Source 2005 2006 2007 2008 2009 Provincial Specific Allocation 119.00 166.50 169.00 127.00 209.5 Development Grants Expenditure 94.48 78.97 82.99 77.32 161.5 (PSDG)- Provincial Roads Utilization (%) 79.4 47.4 49.1 60.9 77.1

59. As seen in Table F-2, the PRDD has not been able to fully utilize the PSDG during the period of review. This is primarily due to the allocations not been released to the PC in a timely and regular manner making it difficult to complete all of the planned work. Whatever cash imprest is released by Treasury is distributed equally among the CE divisions.

60. In addition, the Uthuru Wasanthaya Program implemented under the Ministry of Nation Building has received an allocation of LKR 150 mn in the 2009 budget for the provincial roads in Vavuniya CE division to bring the conflict affected roads to motorable condition.

61. Foreign funds are quite new to provincial roads in NP. The most recently concluded foreign funded STAART, NECORD and CAARP projects financed some provincial roads affected by the tsunami or had been neglected during the period of conflict. Among them NECORD and CAARP invested about LKR 300 mn on the rehabilitation of around 25 km of provincial roads in Mannar and Vavuniya districts. There are at present no foreign funded projects for provincial roads in the NP.

G Maintenance Expenditure

G.1 National Roads in NP

62. Periodic and routine maintenance of roads and bridges on national roads are funded through the Road Maintenance Trust Fund (RMTF) or through the allocations provided under the Maintenance vote as mentioned earlier. Based on a schedule prepared by assessing the network condition, a pre-defined allocation for each divisional office is released by the RDA after assessing the value of the maintenance requirement. Annual allocation and expenditure for road maintenance in NP during the period 2004 to 2009 is given in Table G-1

Table G-1: Utilization of Road Sector Maintenance Funds, RDA in NP Rs Million Source 2005 2006 2007 2008 2009 Allocation 179.0 259.6 228.6 211.8 265.5 RMTF Expenditure 154.1 109.1 102.7 108.8 132.0 Utilization (%) 86.1 42.0 44.9 51.4 49.7 Source: Planning Division of Road Development Authority

63. In addition to the funds from the RMTF there has been a separate program in place for maintaining roads rehabilitated under ADB assistance. Under this program, the national road network of the Northern Province has received a sum of Rs. 2.45 mn in 2006.

G.2 Provincial Roads in NP

64. The PRDD executes routine maintenance work on the provincial road network by using the road maintenance component of recurrent expenses provided through the Block Grant received from the Treasury. Utilization of road sector maintenance funds during last five years are shown in Table G-2.

Table G-2: Utilization of Road Sector Maintenance Funds, Northern Province Rs Million Source 200 5 200 6 200 7 200 8 200 9 Allocation 34.00 50.00 24.00 35.00 40.0 Block Grant-Road Expenditure 33.90 49.70 23.60 34.92 31.2 Maintenance Component Utilization (%) 99.7 99.4 98.3 99.7 78.0 Source Provincial Road Development Department, Northern Province

65. Annually the PRDD prepares a work program for the routine maintenance and improvements to the provincial road network anticipating allocations of funds through the national and provincial budgets. However it is stated that most often the PRDD does not receive the total recurrent or capital allocations made for the year and hence a significant part of the work program has to be continued over or be deferred to the next year. In order to keep programs in an active state, the PRDD adopts a multi-year improvement program which can be completed in stages over a couple of years depending on the availability of funds.

66. This table clearly shows the irregular nature of annual allocations as well as the utilizations thereof. The Block Grant for maintenance has been almost fully utilized during his period. Even though release of the allocation (imprest) is not cited as a reason unlike the case of capital expenditure, it is charged that most of the due funds reach the PRDD only during the latter part of the year making it difficult to complete the annual plans before end of the year. In this case also, the imprest received is distributed equally among the CE divisions.

H Main Sector Issues and Government Initiatives

67. Both the national and provincial road networks in the NP are in very poor condition compared to most other provinces. Though from time to time certain areas were under government control, the respective road agencies were not able to maintain roads at an 13 acceptable level even in those areas due to lack of continuity in funding and political instability. Since most of the roads have undergone failures of road bases, bridges, culverts and retaining walls etc. it will require higher level of financing intervention at the initial stage to bring road network back into a motorable condition.

68. In addition to the road network within the province, national roads leading to the NP were also neglected due to low travel demand. But with the anticipated restoration of civil life and re-development, the traffic demand on these roads such as the A9 north of Dambulla and the A20 between Rambewa and Anuradhapura would increase significantly. Therefore these roads also need to be improved simultaneously in order to increase overall network performance and improve connectivity.

69. Soon after ending the humanitarian operations in the north last year, the Government appointed a 19-member Presidential Task Force to handle the “Uthuru Wasanthaya” Program which aims to implement a set of short-term and long term provincial development programs aimed at rapid resettlement and re-development. The Ministry of Highways and the Ministry of Provincial Councils and Local Government have identified several roads in the national and provincial networks to develop under the Uthuru Wasanthaya program for which foreign funding sources have been identified. Most of these projects are presently nearing completion of design with construction expected to begin shortly.

70. Although many of the problems encountered in both the national and provincial road networks are similar, the solutions need to be examined separately since the institutional procedures in terms of financing, assets management, procuring of contractors; quality control, project management and monitoring etc are different to each other.

71. Almost all machinery of the PRDD that were in Mullaitivu and Kilinochchi districts had been lost once the conflicts escalated in 2006. Presently there are less than 10 machines with the PRDD mostly In Vavuniya and Jaffna.

72. It would also be useful to ensure that for purpose of building capacity of both the local construction industry as well as the road agency for vehicles, equipment and machinery used in large scale foreign funded projects are left behind for maintenance works. It is noted that almost all the existing machinery has been donated to the PRDD under NEIAP and NECORD projects.

73. It is unlikely that the funding required to keep the improved road in a satisfactory level of maintenance will be made available. As a short term solution, the PRDD has proposed to award construction contracts that are coupled with Five Year Performance Based Maintenance Contracts for up-coming foreign funded projects. Given the lack of importance attached for allocating funds for maintenance expenditure of roads, this is considered a logical proposal that would ensure that the asset remains in a sufficiently satisfactory condition throughout this period. It is also possible that such contractors be eligible to get preference in continuing the maintenance even afterwards so that they would ensure that roads are not allowed to deteriorate even during the five year maintenance period.

74. It will also be useful to provide training for staff of road agencies as (a) short courses for engineers and technical officers on technical matters (b) on the job-exposure to new technologies and best practises during project execution and (c) training programs for supporting staff in areas such as accounts, computer and database management.

75. A design office with the relevant equipment and staff is also required for the PRDD with which the PRDD can even provide assistance to local authorities for design of local authority roads.

H.1 Business Procedures

76. The RDA as a statutory organisation under the Ministry of Highways has fewer procedural requirements compared to a Department in procuring goods and services. As an Authority the RDA also accounts for collecting revenue such as for roadside hoardings, compensations for roadway demolitions, rent-out of road sides for trade stalls during festival seasons etc.

77. On the other hand the PRDD operates as a department. It requires several approvals for project especially when the contact value is greater than Rs. 20 mn. This is not a major issue since at present the PRDD only deals with small-scale works valued at less than Rs.20 mn. But with larger projects to be implemented this should be increased. It is also stated that a department structure though more flexible, provides more security and stability for the organisation as it discourages malpractices in award of contracts and prevents unsuitable or unnecessary recruitment. There are arguments that support the PRDD’s continuity as a department particularly given that it requires sound technical management.

78. Since most provincial road contracts are valued at less than Rs 20 mn, the respective EEs and CEs directly manage the projects in order to adhere to the standards and to ensure that they are completed within budget and in time. Neither the RDA nor the PRDA engages consultants for project supervision or for project management other than in the foreign funded projects.

79. Supervision of road projects by external consultants for foreign funded projects has not always been successful. The PRDD proposes that internal staff could be seconded for senior supervisory positions in large road projects for provincial roads. This would also assist in knowledge transfer and internal capacity building.

H.2 Procurement & Bidding Documents

80. Both the RDA and PRDD follow Government tender procedures in the award of contracts for road works. However PRDD restricts this to contractors who are registered with them, while the RDA would make awards to any ICTAD certified contractor.

81. The Government guidelines on procurement specify different procedures depending on the project value. If the contract value is less than Rs. 50 mn, the PRDD’s tender board has the authority to select a bidder. When the cost is over Rs 50 mn but less than Rs 100 mn, it is assessed by a ministry tender board. For contracts with a higher value evaluation by a Cabinet Appointed Tender Board is required. With rehabilitation projects costing nearly Rs 20 mn per km, any rehabilitation project falls in to one of these categories.

H.3 Quality Control

82. The EE divisions of the RDA maintain a satisfactory level of laboratory facilities for quality control of small scale road works. This includes quality assurance of work performed by contractors in medium to large scale contracts that come under foreign funding.

83. In the case of the PRDD there is presently no fully fledged quality control laboratory in the province, even though cadre positions for a lab has been provided. Currently two small laboratories function in Vavuniya and Jaffna. But testing is limited to sieve analysis and compaction testing. This situation is likely to change soon when the fully equipped laboratory established in Thandikulam under the NECORD project of the Provincial Ministry of Infrastructure is opened for the use of all provincial engineering departments including the PRDD. 15

H.4 Asset Management

84. Neither the RDA nor the PRDD has developed a proper mechanism for regular road condition assessment. However, investigations based on the information provided by the respective field officers and complaints made by the general public are used to identify repairs and to include them in the annual development for budgetary requests. Since each of the EE divisions in both the RDA as well as the PRDD do not exceed 200 km of road length, such a manual system of assessment is considered adequate at present.

85. The Planning Division of RDA at its Head Office maintains road inventory and GIS based maps for their island-wide road network planning work. Though most of provincial road agencies have not been able to develop GIS based road maps, the PRDD maintains GIS maps at a primary level even though specific computer facilities, software and training have not been provided. The provision of the required computer hardware and software would be advantageous to ensure a high level of asset management in future.

86. The PRDD also does not possess adequate survey equipment required for road works. Total Stations would be a useful equipment for quality control of construction while, GPS equipment would ensure better location of assets.

H.5 Road maintenance financing

87. The guideline by the National Planning Department 5, sets out the investment cost for rehabilitation of highways. These adjusted for industry prices in 2009 are given in Table H-1. The Public Expenditure Review of Roads Program 6 estimated the average annualized cost of maintenance of roads which are in maintainable standard as 2% of the cost of construction per year. This is a reasonable average given that road construction costs include the cost of structures which have a lower rate of recurrent expenditure. However, in the case of gravel roads this increases to even as high as 30%. These prices vary between provinces depending on availability of material and transport costs. The current costs in NP are on the higher side by a significant amount.

Table H-1: Highway Rehabilitation Cost Estimate (2009)

Type of Road unit Cost (Rs mn) Gravel Road (2 lane 7) Per km 0.4-0.5 Single Bituminous Surface Treated SBST (2 lanes) Per km 12-15 Double Bituminous Surface Treated DBST (2 lanes) Per km 21-23 Asphalt Concrete (2 lanes) Per km 23-33

88. The current desired annual routine maintenance cost can thus be estimated at around Rs 570 mn for provincial road network and Rs 500 mn for national roads by applying the above rates. However, during the last five years, the average maintenance allocation for national roads in the NP facilitated through RMTF was only about Rs 101 mn. In case of the provincial roads the allocation was only around Rs. 35 mn. This has been the primary cause for the extensive state of deterioration of most roads in the NP.

89. The current recover of road user charges is through the levy of an annual revenue license fee and fuel tax. The fuel tax is collected by the central government, while the annual revenue license fee is collected by the respective provincial council. Logically, this revenue should be re-invested on road maintenance. However neither the central government nor the provincial councils have such a procedure in place. As such, revenue is credited to the

5 National Planning Department, Assessing Public Investment in the Transport Sector, Sept 2001. 6 Kumarage AS, Public Expenditure Review Program- Roads, World Bank, June 2006 7 Two lane width includes 7 metre width of carriageway plus soft shoulders consolidated fund and any allocation for road maintenance is made only through the allocations provided in the respective budgets.

90. Such a fund, called the RMTF for financing national road maintenance was created by the central government in 2007. However the funds made available from it are much less than the value of the true maintenance burden. Provincial councils too do not have such a mechanism and continue to manage financing of maintenance of the provincial roads wholly through the block grant provided by the central government. It is possible to create such a fund at provincial level with revenue from annual vehicle licensing.

91. To overcome the inadequacy and inconsistency of road maintenance financing, performance based maintenance has been practiced in several road projects in other provinces and results are reasonably satisfactory. The possibility of awarding a multi-year maintenance contract to the contractor has also been recommended 8.

H.6 Road Safety

92. Sri Lanka has a relatively high accident rate when measured in terms of accidents per vehicle or vehicle km travelled. However, the NP records only around 2% of road accidents. The accident data recorded by the Police do not make accurate distinction between types of road. Pedestrians are the most vulnerable group of road users, followed by cyclists, who are in both cases the party deemed not be at fault for the accident.

93. A majority of these accidents result from inadequate or poorly designed facilities for non-motorized road users, a common deficiency in road development programs. Furthermore, 60% of serious accidents are classified by the Police as due to high speed. This too is partially due to poor alignment, improper intersection design, inadequate passing distances etc. Thus the need for accommodating vulnerable road users as well as road designs that would reduce speed related accidents are considered important to further reduce the burden of road traffic accidents in improved road sections. There is no established road safety audit mechanism at national or provincial level either. These are important aspects to be built into the forthcoming road projects. The benefits in terms of improved road performance and safety are expected to far out weigh the increase in marginal costs of including these designs and audits thereof.

94. Moreover, most roads do not have proper lane markings, signs and location of bus halting places and parking bays. These too need to be included as a priority in future projects.

95. As a policy, the RDD has maintained 5 m carriage width and 1 m soft shoulder on either side of the road for road rehabilitation projects which have been concluded recently. It is recommended that this be continued in future projects with a similar policy to increase total width to at least 10.5 metres in built up areas to accommodate two lanes of traffic with a parking lane on one side and side walks on both side.

H.7 Overloading

96. Also there is no axle load management program for the provincial road network. Legislation for axle loads is a subject within the respective Acts of Parliament where the Police and other officers authorized by Central Government agencies in the respective Acts only are empowered to enforce such laws and to prosecute offenders.

8 Kumarage A.S., Public Expenditure Review of EP,NCP and Uva, ADB TA 2080-SRI, December 2008 17

97. RDA has not carried out any axle load surveys in Jaffna Peninsula or at Mankulam on the A9 and Vellankulam on the A32 which are the locations identified as load survey locations in NP. Even though traffic levels have been depressed during the last several decades due to conflict in the area, it is expected that with the re-development and the resulting construction activity there would be a rapid increase in both the number and the average load of goods vehicles. The transport of construction materials and commodities to and from the NP and various part of the country will result in over-loading damages to both the national road network as well as the provincial road network. The A9 and A20 are two such national roads that will take the brunt of this overloading.

98. No axle load surveys have been carried out on the provincial road network either. It can however be assumed that the same over loading conditions existing on the national roads will prevail on the provincial network as well. Thus the damage on these roads that could result during the period of reconstruction in particular could be significant.

99. Surveys conducted in other provinces by the RDA show that between 40 to 50% of all trucks exceed the legal axle load limits, while in the case of multi axle vehicles this percentage is even higher. Once the immediate re-building process is completed and normalcy is established in the NP, it could be anticipated that the road networks within the province would behave more or less similar to the rest of network but until then it would experience higher over loading conditions. However there is no on-going program to monitor axle loads in the NP or elsewhere in the country. Most importantly no prosecution is being carried out either. There has been very poor interest from road agencies in Sri Lanka to enforce load limitations or adjust road user charges to reflect the degree of damage.

H.8 Vehicle Pollution Control

100. The Central Environmental Authority (CEA) has by Gazette No 1137/35 of 2000 specified the motor vehicle emission standards for Sri Lanka. Under the Clean Air 2000 program several noteworthy achievements have been achieved such as elimination of leaded petrol, ban on importation of older vehicles and most recently the Vehicle Emission Testing (VET) Program. Under the VET Program all vehicles have to obtain an emission compliance certificate in order to obtain a revenue license for the following year. However so far there are no interventions at provincial council level on vehicle pollution control.

H.9 Construction industry

101. Table H-2 shows the number of contractors in the NP who are registered under ICTAD under each grade. It is required to register with the PRDD in addition to ICTAD registration to undertake contracts for provincial roads. Contractors from Colombo or other provinces who have better grades are not as yet registered within the province due to the low volume of work, security issues, risk and the intermittent nature of awarding contracts during the period of conflict. This is a result of the uncertainties that existed during the period of conflict when many local contractors were affected through loss of material, machinery and the inability to complete work once started. It is therefore observed that even though contract amount for award by the Provincial Director of the PRDD can go up to Rs 20 mn, there are currently only a handful of contractors from within the province who have the ICTAD Grade to undertake even such work. This is expected to change with the new security climate and potential participation in the on-going construction activity.

Table H-2: Official ICTAD Contractor Registration Registered Contractor Grade (Rs. Mn.) Total in NP under PC 300

102. The PRDD selects its contractors through their list of registered contractors whereas RDA can award to any contractor from anywhere in the country. However, if higher level of financial and technical capacity required, RDA can even go for foreign contractors through Cabinet Appointed Tender Board. Generally the Ministry of Provincial Council and Local Government intervene in provincial road projects whenever higher financial and technical capacity is required especially in foreign funded projects on provincial roads.

103. Most local contractors especially those below Grade M3 are more labor-intensive. Generally they possess obsolete low capacity machinery that is not suited to carry out work of good quality. This results in them hiring machinery from the PRDD.

104. Since the PRDD does not possess direct labour they select contractors for their routine and periodic maintenance work by awarding small sections of road to enable lower graded contractors to apply. Since the RDA has its own labour, their contracts are mostly for rehabilitation and improvements which are generally less labour intensive.

105. Local contractors have had some opportunities to work in small-scale work foreign funded projects such as STAART, CAARP, NEIAP and NECORD etc. These involvements have helped in continuity of work for them but not in improved in their technical capacity and as such they are much under developed when compared to the industry elsewhere in the country. Therefore any up-coming projects should also focus on establishing a mechanism which would not only give more opportunities to local contractors but also provide for their capacity building.

106. The availability of construction material locally is also a cost-minimizing factor in the road construction industry. However due to prevailing security constraints, there still are obstructions for the smooth operation of all quarries in the NP as some of them are located deep in the hinterland. Alternatively metal quarries in Madawachchiya and Mihintale areas (in NCP), gravel quarries in Vavuniya (in NP) and sand mines in Mannar (NP) can be used for provincial road rehabilitation in both Vavuniya and Mannar Districts. Material required for the rehabilitation of A20 and the A9 road section from Dambulla to Galkulama can be supplied with metal from quarries and gravel from borrow pits located in Mihintale and Kekirawa respectively which are in close proximity to the project area.

107. Since metals and sub-base material (gravel) having the required engineering properties are not available in the Jaffna peninsula, they have to be transported from the southern part of NP and NCP. This would cause an increase in transport costs of road projects in the Jaffna peninsula. However using limestone Mirisuvilai as an alternative material as sub-base could be a cost minimizing solution. 19

108. Moreover it is recommended that the government regulations that are in force pertaining to the restrictions on transportation of construction materials from one Divisional Secretariat to another be eased out in order to facilitate the speedy construction of civil works in the Northern Province.

I Institutional and Capacity Strengthening

I.1 Construction Material

109. It is recommended that the government regulations that are in force pertaining to the transportation of construction materials from one Divisional Secretariat to another be eased out in order to facilitate the speedy construction of civil works in the Northern Province.

I.2 Construction Machinery

110. Between 50 to 60 items of road construction machinery belonging to the PRDD including motor graders, static rollers, vibratory rollers and tractors had been reported lost particularly in the Kilinochchi and Mullaitivu areas after the re-commencement of the conflict in 2006. As a result the PRDD is currently left with less than 20 machines in its possession. Similar losses have been suffered by the private contractors though not officially recorded and thus not quantifiable.

111. Machinery, equipment, vehicles and buildings used for foreign funded projects if handed over to these organisations after completion, particularly to the PRDD, would lead to an immediate and short term improvement in the capacity of that institution.

I.3 Post Construction Maintenance Contracts

112. It is recommended that road construction contracts be coupled with five (or at least three) year Performance Based Maintenance Contracts for up-coming foreign funded projects.

113. It is also recommended that such contractors be eligible to get preference in continuing the maintenance even after this period so that they would ensure that roads are not allowed to deteriorate even during the five year maintenance period.

I.4 Human Resource Development

114. It will also be useful to provide training for staff of road agencies as (a) short courses for engineers and technical officers on technical matters (b) on the job-exposure to new technologies and state of the art procedures during project execution and (c) training programs for supporting staff in areas such as accounts, computer and database management.

I.5 Institutional Capacity Building

115. A design office with the relevant equipment and staff is also required for the PRDD.

116. It is recommended that internal staff could be seconded for senior supervisory positions in large road projects for provincial roads. This would also assist in knowledge transfer and internal capacity building. 117. It is also recommended that survey equipment such as Total Stations for quality control of construction and GPS equipment to ensure better location identification of assets be provided to these institutions.

I.6 Maintenance Funding

118. The actual cost of keeping roads at a maintainable level is much higher than the present level of funding made available for maintenance.

119. It is recommended to create a Road Maintenance Fund at provincial level with revenue from annual vehicle licensing for maintenance of provincial roads. It will also be necessary to enhance the allocation for the RMTF for this purpose for national roads.