IMPACT OF INCREASING BUILDING CONSTRUCTION COSTS ON EFFECTIVE IMPLEMENTATION OF PUBLIC PROJECTS. A CASE STUDY OF THE PROJECTS INITIATED BY THE MINISTRY OF PUBLIC WORKS WITHIN NAIROBI COUNTY - KENYA

Abstract
The rapid increases experienced in utility construction costs have raised the price of recently completed infrastructure projects. This study, therefore attempts to investigate the impact of increasing building construction costs on effective implementation of public projects. The objectives of the study are to identify the major causes of rising building construction costs in public buildings, Identify measures that can be put in place to safeguard the financiers against rising costs as a result of extended preliminaries/time related costs and to identify problems and put in place measures to reduce the increasing building construction costs The study will rely on previous related studies by other scholars and researchers to determine what has been done in this area and also to identify gaps in those studies. The population of the study consisted of contractors, consultants and clients. Purposive sampling were done 40 respondents will be selected thereafter; stratified random sampling will be used to sample the population. From each stratum, 20% of the respondents will form the sample size of 80 respondents. Data collection instruments to be used include questionnaires and document analysis. Data will be analyzed qualitatively using descriptive methods and quantitatively using pie charts, tables, graphs, frequencies and percentages. Data will be analyzed based on the research questions of the studies. This study will help identify the causes of construction costs and subsequent impact of the same during implementation and timely completion of public projects within Nairobi County. Factor analysis of 33 significant variables from the survey, revealed eight underlying factors namely; contractor inabilities, improper project preparation, resource planning, interpretation of requirements, works definition, timeliness, government bureaucracy, and risk allocation as having been significant contributors to overruns. On ranking, government bureaucracy topped the list while risk allocation was shown to have been least significant. There was also a perception that these factors would recur on public projects in future projects under similar implementation environment. By closely relating the factors to the various variables, it was observed that they resulted to overruns on the projects by varying magnitudes. The Projects had time overruns ranging from –4.6% to 53.4 %, while the cost overruns varied between 9.4% and 29%. These revelations should enable planners to take stock of past performance and incorporate lessons learned on future projects planning and implementation. The variables and underlying factors have potential of recurring in future projects, there is need to anticipate their occurrence, and to continually design appropriate strategies and mechanisms to overcome or minimize their potential impacts.

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