Infrastructure delays and cost escalation: Causes and effects in Nigeria

Abstract

One of the major outcomes of the present ailing social and economic conditions in sub-Saharan Africa is the enormous waste of resources due to project delay and cost escalation in the region. This paper critically analyses the causes and effects of project delay and cost escalation in sub-Saharan Africa taking Nigeria as a case study. The major causes of project delay and cost escalation in Nigeria from the experimental survey were acknowledged and ranked. The ranking was carried out using the relative net difference between the mean severity index percentage and the standard error of mean percentage in order to achieve unambiguously the ranking for each variable factor. Empirical analysis revealed the consequences of project delays and cost escalation for some completed projects in Nigeria with these subsequent findings: the minimum average percentage escalation cost of projects in Nigeria was 14%; the minimum average percentage escalation period of projects in Nigeria was found to be 188% with an average percentage completion work of just 96%. To enhance the ability to study this disturbing trend in the future, some mathematical relationships to forecast future project delays and cost escalation effects in Nigeria was developed. It was recommended that efficient manpower and material systems, alternative financial strategies and increased contingency allowance pattern in pre-contract estimates be developed.