For security reasons derived from a terrible infrastructure planning, 11 of 20 stations that are part of Mexico City’s Metro (subway) network have closed down: a social, traffic, media and political chaos ensued. There are plenty of reasons that explain it. Whether it is because the railroads were poorly built or the wagons have worn them out, we’re on the verge of a scenario – as it is usually observed in this type of scandals – in which everybody evades its responsibility. Beyond the political struggle, there is a factor that is always present: infrastructure that goes way over its initial budget and questionable bids that favor specific interest groups. In the face of this juncture and not taking into account the lynching directed towards any given stakeholder, one should question whether these processes might ever be transparent or if those responsible for potential mistakes, faults or corruption acts will ever be punished.
Mexico has seen several works that have been inaugurated as incomplete infrastructure in the last minutes of an administration with the purpose of “closing on a high note” and not present any lack of expenditure (this phenomenon was known as “the year of Hidalgo”, a typical Mexican expression). The last government was no exception to this. For instance, the Emisor Oriente tunnel was inaugurated a day before the tenure of President Calderón came to an end: 22 billion pesos were invested and it wasn’t finished on time. The “El Realito” dam was a similar case; located between the limits of Guanajuato and San Luis Potosí, its basin was presented whilst the aqueduct was left incomplete. Lastly, the Oaxaca-Puerto Escondido highway, which was promised to be delivered by 2011, ended at the beltway located between Ocotlán and Ejutla, which is 200 km away from its original destination
The main problem of a corruption act is not the public works’ high cost but the surplus that has to be paid in order to conclude them. In a public infrastructure project, especially grand-scale ones, there are always obstacles that will naturally increase the cost that was originally estimated for its construction. The latter is understandable. However, when talking about a public work, these surpluses end up being mind-boggling. The Metro’s Line 12 ended up being 70% more expensive than originally projected, while the new Senate headquarters were 137% than its initial cost. Additionally, both works were badly constructed. The Estela de Luz has got to be included in this list as well, a 1.3 billion pesos ornament (192% more expensive than its initial budget). Although it is true that the final price is generally higher than initial estimations (the margin is around 15%), but this information should be transparent and publicly available. The Public Works Law’s 31st article, 15th fraction starts that all previously designed projects or programs developed by construction companies ought to include estimates, specifications as well as truthful information, and also adjust themselves to the real requirements of the work that is to be done. What is most important is that the aforementioned forces these companies to consider estimated costs that are based on market conditions. If this is the case, why are there so exorbitant final prices and who is responsible for it?
The infrastructure sector within the Expenditure Budget presents several changes. This is due to political lobbying as well as the uncountable number of requests from Mayors and Governors that propose “mega-works” as an electoral maneuver (most of the time, the aforementioned projects are not a priority compared to railways, airports or wireless broadband networks). It is alarming that Mexico wants to play a major role in the hydrocarbon and telecommunications while also presenting a serious infrastructure deficit. The latter makes it less profitable by not having enhanced lines of communication, electricity as well as drinking water, which may reduce production costs and transportation of goods.
Will it be possible that the titillating promises of a new Metro line in Monterrey, an inter-city train that crosses Mexico and Toluca or a trans-peninsular transportation between Quintana Roo and Yucatán are projects that will truly appeal to the country’s productiveness and, above all, make an efficient allocation of public resources? Ideally, in system that is fully accountable, there should be controls, transparency and enforcement. However, while the possibility of sanctions remains low and private benefits of excesses stays high, the aforementioned concepts will keep on being overlooked and the incentives to continue the depletion of budget will continue to be high.
CIDAC
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