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Capital project overruns by PLP and UBP governments

Finance Minister Paula Cox said lessons have been learnt from capital projects which have cost millions of dollars more than originally budgeted.

Speaking to the Bermuda Sun earlier this week Mrs. Cox said she was a "cog in the wheel" who cannot overrule various ministries' requests for more money but added: "Cost overruns on projects are vexatious and are not taken lightly. Lessons have been learnt from recent experiences. Enhancements to controls that accord with best practices are in the pipeline."

The Royal Gazette takes a look at capital projects by PLP and UBP Governments which have seen their budgets balloon.

Port Royal Golf Course

In the 2007/2008 Budget the cost of the overhaul of one of Bermuda's public golf courses was stated as $7 million, it rose to $13.6 million in the 2009 Budget. The final cost was $15.9 million.

Government MP Zane DeSilva told the House of Assembly a change in plans added a concrete path, which the MP said increased the cost by $1 million dollars. And he argued that the remaining overrun was less than ten percent, which was in-line with industry standards.

Dockyard Cruise Ship Pier

The pier was originally supposed to cost $35 million but in the end it was delivered at a $65 million cost to taxpayers.

Premier Ewart Brown admitted he was "not proud" of the dock rising 70 percent over budget, but blamed design changes and Government inefficiency. Dr. Brown said the initial contract was revised due to delays from "dolphin mitigation" (the birth of three calves at Dolphin Quest in May/June 2007), Planning approval, and "resultant design and construction methods" to meet the start of the 2009 cruise ship season.

Berkeley Institute

The school was dogged with controversy when it was finished three years late and $50 million over budget.

It was supposed to cost $88 million but ended up at $121 million. The original contractor Proactive were fired and new ones hired, adding to the cost. And former Minister of Works and Engineering David Burch said approximately $27 million of the overruns sum included works not covered by the original contract, such as a new sewage pumping station and line, BELCO feed, land purchase and landscaping.

Police/Magistrates' Court Building

This has not been completed as yet. It was estimated to cost $70 but Government has said it will end up costing more than planned.

Works and Engineering Minister Derrick Burgess said the overruns are a result of the building having to comply with new legislation, Police and Criminal Evidence Act, which governs policing.

L.F. Wade Airport

This capital project was completed under a United Bermuda Party Government.

It had an initial budget of $9 million but ended up costing $25 million. The then Government said this was due to having to redraw plans to comply with FAA regulations as well as construction delays.

Westgate

This project, completed by the UBP, started at $20 million but rose to $38.8 million.

One of the overruns which was heavily criticised was a $2 million overpayment to contractors.

Tynes Bay

The UBP project jumped from $26 million to $73.7 million.

At the time they said the drastic rise in the cost was a result of having to comply with requirements for air quality equipment.