A Review of Highway Agencies in the South Asia Region

A Review of Highway Agencies in the South Asia Region
5.3.2 Financial Security
from politically motivated appointments and transfers. These aspects become even more
critical if the agency is to attract and retain staff with specialized skills such as business
administration, financial expertise and others.
Involvement of Users and Stakeholders
A valuable lesson from the international case studies is the importance of the involvement
of stakeholders, including users, in decision-making. By involving stakeholders, the highway
agency is able to develop a long-term strategy for the network and thus the organization –
a strategy that is supported by the stakeholders. It is obvious that trade-offs between the
demands of different stakeholders are unavoidable. However, the collaborative process
creates support for the highway agency’s strategy.
The formal agreement of strategy, and its translation into the annual performance
agreement, results in explicit targets the agency promises to achieve. By looking at the
agency’s regularly published reports on performance, stakeholders can hold the agency
accountable for not meeting targets. Conversely, a good performance will strengthen
stakeholder support for the agency. Stakeholder involvement thus contributes to the
accountability of the agency.
Stakeholder involvement extends beyond being part of the process of developing the
agency’s strategy. At the project level, users and stakeholders can be involved to ensure that
projects are implemented smoothly and not subjected to adverse actions by, for example,
landowners 22 . Regular interaction with stakeholders will provide the agency with valuable
information on the performance of the network, individual assets and itself, in general.
Based on their feedback, the agency can take necessary action, when required, to ensure
performance levels are maintained.
Human Resource Management
The highway agency will need to attract the right employees and expertise to monitor
performance, and develop and implement plans accordingly. As previously discussed,
this calls for an organization that has the appropriate in-house skills for the evaluation
of the indicator and underlying information, management of projects and financial
expertise. Phase 2 is thus the phase in which changes in recruitment of officials and related
human resource management issues should be implemented. These reforms need to be
implemented before the negotiations with the parent organization can start, to ensure that
negotiations produce the required results.
Highway agencies face two challenges with respect to financial security. These are a
quantum leap in highway infrastructure investment and attracting necessary investments.
Apart from internal changes, following the introduction of a system for monitoring of
capacity and performance, highway agencies need to be enabled by implementing:
A ring-fenced budget for highways construction and maintenance;
Adequate financing; and
Valuation of the network.
Ring-fenced Budgets
Setting aside budgets dedicated to highway construction and maintenance better enables
the highway agency to independently decide on the funding of projects through a fund. This
reduces the possibilities of external interference in the distribution of funds. Moreover, if set
22 This is not to say landowners or other stakeholders cannot object to proposals or, for example, demand higher compensation. However, cooperative
involvement of stakeholders tends to contribute to the efficiency of implementing proposals.
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