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Published byClarissa Short Modified over 8 years ago
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Framework for Introducing OPRC Christopher R. Bennett Sr. Transport Specialist EASTE
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2 Success of OPRC OPRC will be successful only if: Business objectives met Service levels met Requires that: All parties involved have appropriate skills Good foundation (legal/technical) Tender and contract is properly conceived and executed This Presentation
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3 Meeting Service Level and Business Objectives
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4 Introducing OPRC Separate studies undertaken by consultants in China (expressways), Egypt, Indonesia Objective: establish an appropriate framework for introducing OPRCs Industry issues Management issues Legal issues
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5 Overview of Capacity
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6 Commonalties Issues Overloading How to handle cost escalation Ensuring adequate data Success factors Training to understand OPRC Capable local consultants
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7 Overloading Issue in all three countries Enforcement lacking Risk to contractor Challenge Those who control overloading (government) must take the risk for failure to control Tender documents may need to recognize traffic loading
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8 Overloading Options Government Authority Government all weighing and fining powers Contractor all records to ensure compliance Contractor Authority Contractor full authority to control Requires support of police Contractor Compensation Contractor operates weigh bridges Compensation for additional overloading from initial levels
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9 Cost Escalation Indices for escalation exist Questions about suitability Do not properly reflect maintenance activities - especially OPRC elements Data supplied by government - not independent Can be large time lag in updating so contractors carry additional costs
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10 Framework Challenges Varied by country Principal ones: Policy Legislative Contractual Establishing key performance indicators Options for innovation (eg flexibility with design standards) Industry training and knowledge transfer
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11 China - Key Issues Few expressway companies concerned about operational efficiency Operational and engineering issues drivers Without profit motive do not see value in OPRC Potential benefits of OPRC weighted against negative labor impacts
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12 Egypt - Policy Issues Utility services: Need to manage crossings to ensure no impact on contractor Price escalation: Only included materials, not labor and fuel
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13 Egypt - Legislative Issues No legal impediment to multi-year contracting Need to ensure prompt payment of contractors Overloading Currently have a penalty of EL20/t - should be proportional to overload No power to remove vehicles < 40% overloaded from road
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14 Egypt - Contractual Issues No major contractual issues Use of World Bank’s SBDs appropriate - if in Arabic
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15 Indonesia - Policy Issues Utility services: Need to manage crossings to ensure no impact on contractor Bond requirements: Construction bond provisions insufficient for OPRC Cost Escalation: Need sound index reflecting contract inputs: o Industry confidence o Impact on ability to obtain bonds
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16 Indonesia - Legislative Issues Financing Arrangements: MOF support for multi-year contracts Overloading: How to control overloaded vehicles to share risk between contractor and government
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17 Indonesia - Contractual Issues Provision of benchmarking data Relationship between contract parties Role of contractor/consultant/client Use of management board Appropriate tendering process How to treat initial improvement works Use of World Bank’s SBDs appropriate
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18 Major Conclusions China: Most expressway companies not managed to maximize profit so little incentive for OPRC Egypt: No major impediments to OPRC beyond lack of experience Indonesia: With legislative reforms to allow multi-year contracts OPRC viable
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19 Most Important Success Factor In all cases there is a need to provide support and upskilling of Government Consultants Contractors PPIAF have financed OPRC training course which can help with this
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