Reaction of the railway infrastructure manager to the Supreme Audit Office’s conclusions

20.04.2015

The Supreme Audit Office (SAO) examined past providing, drawing and using money for repairs and maintenance of nation-wide and regional railway systems in the years 2010 - 2014. The inspection did not find any essential fault on the side of the Railway Infrastructure Administration (RIA) Headquarters or its Regional Directorates. According to SAO, the inspection found out that RIA could act more economically in some individual cases. However, the railway infrastructure manager cannot agree with some reprimands of the inspectors as shown in the SAO’s press release.

“During the final hearing from the inspection of the economic management of financial means designed for repairs and maintenance of railway lines as a whole, SAO stated that RIA did not infringe any directive or regulation and that it always respected current legislation in force. In comparison to inspections of other organisations, RIA did not come out badly and no system deficiencies were ascertained”, said Mr. Bohuslav Navrátil, Deputy Director General of RIA responsible for the field being object of the inspection. ”This is essential and positively good news for us“, said Mr. Navrátil while commenting the inspection’s conclusions.

”Of course, there is always space for improvement. That is why the Railway Infrastructure Administration will carry out an analysis of all findings of SAO’s inspection and will use them to improve managing activities of our organisation even further“, said Mr. Navrátil, Deputy Director General representing the infrastructure manager about the procedure to follow. During the period 2010 – 2014 which was the object of inspection, some procedures that were also controlled by SAO were gradually being specified based on findings of RIA’s own internal audits. The inspectors’ conclusions notwithstanding, corrective and specification measures were adopted in most cases in the past.  RIA raised objections against some of the findings as they are inaccurate or do not reflect the current state of things according to the infrastructure manager.

However, RIA found even more inconsistencies in SAO’s report. The inspectors were referring e.g. to evaluating maintenance works or to a severe selection of suppliers. They dealt with planning railway lines’ repairs as well.

The Railway Infrastructure Administration cannot agree in principle with the inspectors’ statement that it restricts the quantity of possible applicants by qualification requirements being too severe. As an example, orders are quoted with a presumed value of 2 - 5 billion CZK where according to SAO RIA required for the suppliers to demonstrate the volume of orders amounting to 50 million CZK carried out during the previous three years. This statement is not to be found in any protocol of inspection having been handed out to RIA by SAO.

This information is misleading as this numerical data is exempted from the RIA internal instruction where it is of course showed as maximal and is always adjusted based on a specific character of a given order. This is therefore not data from any realised tender. The requirement for a volume of works carried out in the field as such comes from the obligation of RIA as infrastructure manager to assure the works’ implementation as client only by professionally apt suppliers who know the railway milieu and will not disrupt railway operation safety during the works implementation.

Neither can RIA agree with the statement that this situation is the worst as far as bridges, culverts and tunnels are concerned. From a technical point of view, it is not possible to compare the state off things on the railway superstructure, the railway substructure, a bridge, a culvert, a tunnel, the overhead line, a power feeding installation, safety equipment, a platform, a building etc. From the point of view of accidents in the previous years, no exceptional event caused by the technical state of a bridge, a culvert or a tunnel has been noted. Therefore the Railway Infrastructure Administration rejects on principle this totally unfounded statement as it could be seen by the travelling public as completely misleading information on possible deficiencies in railway operation safety.

Differences in offer prices of individual applicants criticised by SAO result also from the character of separate repair works being carried out that however, were not taken into consideration by this unsophisticated and misleading inspectors’ procedure anymore. ”Surely there must be a difference e.g. in prices for exchanging a single sleeper if the order contains an exchange of individual sleepers compared with an order with a price for exchanging e.g. tens or hundreds sleepers in a single line section. The items have a different price if the works are to be carried out during train pauses or closures“, says Mr. Navrátil while demonstrating the erroneousness of the inspectors’ statement.

According to their conclusions, the inspectors also found out that RIA was using a price catalogue for evaluating maintenance and repairs which did not contain objective information for such a comparison. No wonder that by this incorrect comparison, disproportional differences – sometimes by 100%   - were found out for works of a same type.

The problem was that SAO was comparing selected items from applicants’ offers with prices shown in a maintenance works catalogue, more specifically in a works’ collection. However, it must be added that up to 2010, there was not any tool of such a kind for repair works’ implementation! Only since 2010 the Railway Infrastructure Administration itself started creating a unified works’ collection for the maintenance of individual parts of the infrastructure as well as description of these items. These are very specific works that are not being carried out anywhere else except the railway infrastructure. Only in 2013 an order for separate items’ price calculations was placed in cooperation with the Ministry of Transport and the State Fund for Transport Infrastructure; in 2014 this collection was put into testing operation and only since February 2015 it is fully in force. This document contains tens of thousands of items where each item has a described material content and an elaborated economical calculation. Due to the fact that during the period 2010 - 2014 this document fundamentally changed shape, the material content of individual items was changing as well including the price (naturally) and no positive conclusions can be drawn from the comparison of prices as shown for each item in the collection with prices offered by applicants. Moreover, RIA always makes the selection of suppliers for the implementation of repairs and maintenance as such by form of tenders so that a supplier providing a service while satisfying the given conditions for the lowest price gets priority.

SAO submitted erroneous data e.g. also in the inspection protocol on the orders’ volume, the amount of suppliers from the field of bridges, culverts and tunnels – RIA subsequently recalculated all numbers shown. The result and comparisons of the error rate can be found in the chart hereunder. SAO retroactively accepted these objections. The Railway Infrastructure Administration is now also analysing data from inspectors concerning the amount of orders and suppliers in the field of railway substructure and superstructure as shown in SAO’s press release. Preliminary calculations already demonstrate that this data is also inaccurate and therefore equally misleading.


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