An increasingly longer nose of Pinocchio
Wieslawa Lewandowska talks to Jerzy Polaczek, MP, about the success of serviceability of the Polish motorways, a billiard club in Shanghai and ‘beautiful chaos.’
WIESLAWA LEWANDOWSKA: – Why are there no good roads in Poland? Why are there no motorways? We have asked this rhetorical question for decades. Can you answer it?
Jerzy Polaczek, MP: – I will try although the matters seem complicated, especially when we mean the recent times. Speaking from the historical perspective, during the period of the Polish People’s Republic no motorway networks were built. Only in the early 1990s the government of the Democratic Left Alliance (SLD) took a political decision to build motorways for private money. Even a few concessions were granted. After 1989 this new process of ‘building roads’ was shadowed by the old and specific policy – overwhelming decisions to build ring roads in some cities but there were no strategic preparations, plans to finance and construct key motorway sections and express roads. One must also say that till 2005 the construction of solid road and rail infrastructure was planned for only one term of the Parliament – sometimes for objective reasons but mainly due to the fact that this priority was not rooted in the real politics of the state.
– Didn’t you try to overcome that trend when you were the Minister of Transport?
– It was only the previous government that changed it! The government put huge efforts and gave the green light first of all to finance projects and buy land to build roads in the years 2006-2007. For the first time in Poland’s history after 1989 there were no financial restrictions in this sphere. We succeeded to start this invisible, arduous process of preparing road investments, which politicians usually treat in a stepmotherly way because it is not good enough for the media to report. It was then that Poland became the biggest construction site in Europe. I spoke about it with satisfaction as the former Minister of Transport and Construction. Moreover, in 2007, the National Road Construction Programme (for the years 2008-2012) was accepted by the Cabinet. By the way, it is worth reminding that the previous government ensured the effective use of the EU subsidies for Poland for the years 2004-2006 and there was a real danger that they would not be used and so we would have had to give them back.
– You say that the reasons for the present collapse cannot be justified by the negligence of the former government...
– Yes, I would like to stress that firmly.
– Are you surprised by the present gigantic troubles?
– Perhaps the most surprising thing is the failure of the present government to construct two best, economically speaking, motorway sections: the A2 from Strykow to Warsaw (100 km) and the A1 from Strykow to Pyrzowice (180 km), given to the public-private partnership. I cannot understand why the government of Donald Tusk signed the contract for the construction of one of these sections with the same company that had failed to construct the Okecie airport… And the ineffectiveness of the beginning of 2009 concerning the signing of the contract with the private investor to build a motorway section leading to the capital of Poland – a 38 million country – is not ‘the best picture’ of the ideological model, not based on the real balance, in which the private means cannot be used for the economically best motorway section in Poland but they are found for other, less attractive sections when the state simply ensures their full guarantee! One can add to this picture that in the case of the A1 motorway the investor did not obtain means from bank loans but the construction project it had prepared was so fatal that until today the Director-General of National Roads and Motorways (GDDKiA) has not been able to use it as the basis for the tender as to the traditional model; the project had to be thrown away.
– And how it happened cannot be really explained?
– It can always be explained but is hard to understand! The reason is that in Poland in the 1990s there was the principle that motorways were to be built with private money and the government was to prepare the state guarantee scheme, worth several billions, for bank loans, including the guarantee for definite profits given to private entities from their right to exploit the private motorway, which is worth remembering. Considering the division of profits: the risk of the concession-holder was always smaller and as the latest experiences show, the costs of the public entity are big. The government of Donald Tusk prolonged the system for three years (it was to expire on 1 July 2008) and in the years 2008-2010 the government paid the sum of over 2 billion zloty as compensation from the National Road Fund for two economic entities exploiting two motorway sections: the A4 Krakow – Katowice and the A2 Wielkopolska motorway! At the same time this government is wondering unacceptably whether it should exempt the inhabitants of metropolises that live close to the most important paid motorways (municipal) from paying tolls because – as the government estimated – the lack in the budget amounts to… how much?… 2.5 billion zloty… for 25 years.
– Since as usual we lack public money…?
– The government of Donald Tusk, compared with all the previous ones, has historically the biggest means: its own and the EU subsidies and therefore, it has naturally realised more investments – it cannot be otherwise – but it has not used all these financial possibilities – only less than 60% of the available means. Additionally, in 2011 it made rapid cuts, which led to the stoppage of financing the preparations of new road and rail projects, not mentioning the cancellation of numerous road investments.
– What does it mean?
– It means that after the completion of the investments there will be a political and financial catastrophe because a large part of the EU subsidies for the road programme and the more for the rail programme have not been used. I wish I were wrong but we are close to the scenario to return some part of the EU subsidies. Moreover, the delayed realisation of many investment projects causes a rapid accumulation of expenses that should be settled by the end of the current period of EU planning (by 2013). Thus the next government will have a ‘mine,’ especially in the years 2012-2015.
– Where does this helplessness to use the EU subsidies come from?
– Perhaps the present government is supporting the fashion: the farther from manager’s and engineer’s knowledge the better qualification to manage and build infrastructure… It was useless that during the press conference in January 2011 the government of Tusk announced that it would move 5 billion zloty from the rail investment to the road one without presenting any analyses! All experts know that it was a manoeuvre that the EU does not permit. The result of Tusk’s decision is that we have several virtual road projects and investment ‘collapse’ in the railways. I can add that the EU refunds (billions of zloty) for roads are also endangered because the government did not implement the important EU regulations in our road law, concerning the road infrastructure security management, on time. Just recently the spokesman of the European Commission has mentioned this fact.
– Was it a reprimand?
– Yes, it was. Furthermore, the problem is that currently we have the biggest EU means for infrastructure, i.e. for financing the construction of roads and railways, but the government of Donald Tusk has not its own legislative priorities (the deadline of their implementation was in 2010), it has not even announced the adequate bills concerning the road infrastructure security management and also in the rail transport – the fundamental issue, which is the so-called interoperativenss and security of the railways! The European Commission has already put forward a warning motion regarding this matter to the Polish government.
– But the most important thing is that during Euro 2012 Championship the Polish roads will be serviceable!
– For some time, especially Prime Minister Tusk has been using the formulation that the government will assure ‘serviceability’ of our motorways in 2012, i.e., for Euro 2012 matches. But it is enough to look at the regulations of the Polish road law to notice that the Polish law does not use the term ‘serviceability’ unless we speak about the new road category: C – D (Cezary – Donald). If such improvisations are formed by the highest state authorities the effect will be only non-serviceability prolonged for next years.
– We know from recent history that our constructions were completed roughly and in a hurry, only to succeed before 22 July!
– And so will it happen before Euro 2012, only on a larger scale and using higher costs. Roads will be provisionally ‘serviceable’ for 2-3 weeks and then they will need repairs for at least a year…Today the so-called plan B, prepared by the Prime Minister, concerning a few motorway projects is that these roads will be constructed much later and for much bigger money.
– When will Poland be able to boast of a series of truly European roads?
– This perspective moves in time. During recent months there were such sharp cuts in investments that the construction and modernisations of many express roads was moved for the next generation. It concerns the road from Poznan to Wroclaw, which will not be built for Euro 2012, but at the earliest in 2020… And the extremely important express road S19 from Rzeszow to the Slovakian border can be finalised only in 2035 whereas the most important motorway unit A1 from the junction at the airport Katowice-Pyrzowice to Strykow will not be built in 2012. It is not know when the construction will begin. But in this term the Deputy Minister of Infrastructure bet publically that it would be ready by the middle of 2012. The only effect of his bet was his ride on the bicycle. But we all do not want such effects…
– Why were these cuts made?
– Perhaps not to finance new investments and leave empty drawers to the successors? It is hard to understand this methodical removal of the priority of the modernisation of transport infrastructure… Why isn’t it a key priority of the state politics, despite social expectations, but only one of many – as you can see – unimportant tasks? Even the government may not know the answer.
– Why do foreign companies, sometimes from very exotic countries, build roads in Poland?
– Some European countries, e.g., Spain, Ireland, Portugal, built good positions of their own specialist companies when they drew the biggest EU subsidies to modernise their own road or rail infrastructures. In Poland we dealt with the collapse of the construction companies that were privatised at first and with time became branches of several known European concerns. Unfortunately, we have not built good, competitive companies with Polish capitals. But now it is a historical time for the Polish experiences of road market to bear interest in other European countries, in their constructions.
– The appearance of the Chinese company, which – as we were assured – presented the best and cheapest offer to build this extremely important motorway section, was surprising …
– The cheapest offer but it was so cheap that one could easily notice that it could not be the best, especially if we considered its quality. If we acknowledged that our government was serious and the Director-General of National Roads and Motorways had estimated the costs of a given road investment precisely, it would have been stupid to accept that some firm could build a motorway for 40% of the costs the Polish office calculated. In the EU countries the offer estimated by the public office always has the fundamental value and the margin of departures is very small. Moreover, which is extremely important, the standardisation of technical regulations concerning preparation, construction and realisation of road investments is absolutely required. The Polish government neglects these standards and by estimating the investment for 2.8 billion zloty and signing the contract for 1.3 billion zloty it put itself in a grotesque situation.
– Perhaps the estimates of the Polish governments were too high?
– The realisation has shown that the estimates were right. It is the Chinese partners that proposed unreal low costs and the government believed their miracles somehow… The contractor did not do badly. They left the construction site and were paid for what they built.
– The government itself seems to be surprised that the Chinese company did not meet the challenge…
– They should have been the last ones to be astonished… Now they commission the completion of the investment without any tender. I ask, ‘If it is legal why didn’t the government use this possibility to build the A4 motorway – the construction site has been empty since the Macedonian company left a few months ago.
– Why did they choose the Chinese offer if they had known that it would not guarantee the completion of the investment?
– The problem is that the government did not sign the contract with the Chinese that had built the real infrastructure… As it turned out the company-daughter of the Covec firm was a small entity employing ca. 300 people in China two years ago, having annual sale not bigger than the value of the contract signed in Poland (ca. 1.7 billion zloty), operating mainly on the African market in such countries, exotic for us, as Mauretania, Zambia, Mali or Fiji Islands…
– The Polish government let to be cheated…
– … like a small boy! And additionally, the matter was not explained by the government but by one of the dailies that conducted investigation on the telephone… It was to the discredit of the government that did not take the slightest efforts to verify some unknown Asian partner that was to enter the Polish market; its reliability was not verified and neither were its financial possibilities, experiences and recommendations… To do that the government did not even have to ask the special services… If a contract for one billion zloty had been signed, an extra one thousand should have been spent to pay for the evaluation of the reliability and experience of the Asian partner that entered the construction site in Poland (I mean the concrete Asian partner).
– Carelessness or stupidity, or something else?
– I would say ‘something else’… but this ‘something else’ is hard to identify although, unfortunately, it has too frequently accompanied important events in our country… I do not believe in coincidences in such situations! The most interesting thing is that the government should have informed Poles that it would gain many millions of compensation and guarantee when the Polish companies, trying to make contacts with the representatives of the Covec firm, found them in a small office in Beijing or found out that the second address of the firm was a restaurant and a billiard club in Shanghai…
– That’s why you call the government of Donald Tusk ‘Government of Delayed Phase?’
– For many reasons. We won’t have enough time to mention them all. This tragic term of the government – marked by the Smolensk catastrophe – is characterised by the fact that those who hold political responsibility, fulfilling their duties, somehow as a rule wake us five past twelve, always too late, but always with satisfied looks… If the government that on the one hand says that the modernisation of road and rail infrastructure in Poland is its priority and on the other hand, it does not implement the regulations of the European law – that are needed as the air since they guarantee to obtain and refund the subsidies – it actually forgets what is most important. They might have undermined that or simply could not have been able to manage that. I do not know… The fact is that the government has always been late for some reasons, which only the ministers know. For example, the construction of the National Stadium about which the football fans were informed at first that for every day of delay there would be a one million zloty fine, and then in the light of film cameras Prime Minister Tusk announced that the stadium would be completed… half a year later after the deadline and without any interest for default, which he had announced… The Prime Minister is playing excellently the role of satisfied Pinocchio …
– And we like this long nose of Pinocchio somehow …
– Indeed, we like the government’s playing football and grilling out… People do not like politics and do not want to know what it is about and even what it should serve for. It seems that the government does not know that, too, and only depends on the PR that brings desirable short-term effects… We do not realise fully that we have already paid for this oversight, negligence of the government in the most troublesome spheres as tax-payers, as parents of school children and as users of the Polish roads.
– And perhaps this wide-scale construction of infrastructure in a definite period of time – by Euro 2012 – was simply unfeasible? Perhaps it was too big ambitions?
– No, we could have done even more if we had had right people in the key positions, deciding about the success of these ambitious ventures, and not politically accidental people. If only the whole policy concerning the infrastructure, which the previous government worked out, without asking about political preferences but only about manager’s skills, had not been rejected… All those people who were successful as engineers and managers were dismissed under the slogan of getting rid of ‘those horrible members of PiS,’ even if they did not belong to PiS… Since the beginning this government has conducted a policy producing beautiful wrappings that are filled with ‘beautiful chaos.’
– Minister Cezary Grabarczyk asked the opposition to keep their fingers crossed for the success of the governmental investments on the A2 motorway. Are you keeping your fingers crossed?
– I am keeping my fingers crossed for the constructors so that their effect was quality but I do not intend, frankly speaking, to keep my fingers crossed for the government’s ‘chats’ only to confirm some scenarios that will never happen. To be honest, my heart bleeds when I look at the issues, which Poland could have won and been very successful to the measure of one generation, and not to make mistakes concerning many investments, which will affect … the whole future generation!