Causes of construction cost and time overruns: The 2010 FIFA World Cup stadia in South Africa

Abstract

The FIFA World Cup is the largest international sports event in the world. Hosting the FIFA World Cup remains a sought after goal for any country. Due to the magnitude of spectators and scale of participation the hosting of the event requires substantial investment in infrastructure, especially the stadia where the various football games will be played. The award of the 2010 FIFA World Cup to South Africa resulted in ten stadia to be either upgraded or newly constructed for the event in South Africa. Even though all the stadia were ready for the tournament, nearly all projects experienced time delays and cost overruns. This article investigates the reasons or causes of cost overruns and time delays during the upgrading and construction of the various stadia. A three-tier research approach covers a comprehensive literature review on the causes of cost overruns and time delays on construction-related projects globally as well as an investigation into the factors that caused cost overruns and time delays on six of the stadia. Finally, the results for the global and stadia projects are compared. The results indicate that the increase in material cost is the single largest contributor to cost overruns for both global and stadia projects. With respect to time delays the most significant contributing factor for global projects was late delay in payments while for the stadia projects design-related factors caused the most delays. The results provide valuable information on the unique challenges facing those who are interested in investing or managing construction projects in South Africa.

Keywords: Project cost performance, schedule delays, cost overruns, project construction

Die FIFA Wêreldbekersokkertoernooi is die grootste sportgebeurtenis in die wêreld. Dit is ‘n groot eer en voorreg vir enige land om die toernooi aan te bied. Gegewe die magdom aantal toeskouers en vlak van deelname aan die toernooi word heelwat spandeer om die land se infrastuktuur, veral die stadions waar die wedstryde gespeel word, op te gradeer. Die toekenning van die 2010 FIFA Wêreldbekertoernooi aan Suid-Afrika het tot gevolg gehad dat tien stadions opgegradeer of nuut  gebou moes word. Hoewel die tien stadions gereed was vir die toernooi het feitlik al die stadionprojekte  skedulevertragings en oorspandering beleef. Hierdie studie het ten doel om die redes te ondersoek wat aanleiding gegee het tot skedulevertragings en oorspandering tydens die konstruksie van die nuwe, en opgradering van die ou stadions. ‘n Drieledige navorsingsbenadering het ‘n volledige literatuurstudie ingesluit oor redes vir oorspandering en skedulevertragings op internasionale konstruksieprojekte, op ses van die stadionprojekte. Laastens word ‘n vergelyking tussen die twee groepe projekte getref. Die resultate toon aan dat die toename in materiaalkoste die grootste bydraende faktor is tot oorspandering vir beide internasionale- en stadionprojekte. Wat skedulevertragings betref, het vertraging in betalings die grootste impak op internasionale projekte gehad terwyl laat ontwerpveranderinge die grootste impak op stadionprojekte gehad het. Die resultate verskaf waardevolle inligting rakende die unieke uitdagings wat in berekening gebring moet word deur beleggers in Suid-Afrikaanse konstruksieprojekte.

Sleutelwoorde: Projekkosteberekening, skedulevertragings, oorspandering, projekkonstruksie