A Theoretical Examination of Causes of High Costs of Government Construction Contracts in Nigeria

Abstract

Based on uncontestable evidences, the costs of executing construction contracts in Nigeria are extremely high. It has been widely acknowledged that Nigeria pays times-two more than any other country in the World particularly her immediate African neighbours for implementing government construction projects in a bid to provide social and economic infrastructures for the citizens. This phenomenon has had enormous devastating consequences for the country’s economy over the years. Amidst this situation, the generally held view is that “corruption” in the public procurement process is the most singular factor responsible for this undesired development. This paper is opposed to this conventional assumption. It argues that, while corruption is one of the contributory factors, it is not the only major factor underscoring the high costs of public contracts in Nigeria. In the view of the paper, other factors such as; inflation and currency devaluation; project design, quality target and time; project environment, scarcity and shortage of materials, poor cost forecast and management, bureaucracy and budgetary delay, etc., are among the major causes of the high costs of implementing government construction projects in the country. However, by way of proffering solution to the problem, the paper recommends some measures as strategies for addressing the situation so as to save the country further waste of scarce financial resources that has drained the economy over a long period. The paper is theoretical and qualitative in approach. Data for the paper were derived from secondary sources, and the data were analyzed using the descriptive analytical method of qualitative writing. These methods were found most suitable and appropriate for the study as they enhanced the achievement of the paper’s main objective