Title: Causes of cost overruns on infrastructure projects in Saudi Arabia

Authors: Fahad S. Allahaim; Li Liu

Addresses: Faculty of Engineering and IT, School of Civil Engineering, The University of Sydney, Building J05, NSW, 2006, Australia ' Faculty of Engineering and IT, School of Civil Engineering, The University of Sydney, Building J05, NSW, 2006, Australia

Abstract: This paper reports an up-to-date ranked list of causes of cost overrun in Saudi Arabia from a survey of 160 project managers of infrastructure projects. The top five causes were market conditions, design changes, the practice of assigning a contract to the lowest bidder, delays and design error. Assigning a contract to the lowest bidder is not ranked in the top five reasons in other countries. Other factors contributing to cost overrun of Saudi infrastructure projects include lack of contractor and consultant planning before the project, poor coordination with government agencies and parallel contracts, inconsistent management strategy, poor client staff communication and stakeholders' lack of participation during the conceptual phase. A cause unique to Saudi Arabia is due to the time it takes the Labour Ministry to issue labour visas to non-national workers.

Keywords: cost overruns; cost overrun causes; infrastructure projects; Saudi Arabia; project management; market conditions; design changes; lowest bidder; delays; design errors; labour visas; project planning; coordination; government agencies; parallel contracts; management strategy; client staff communication; stakeholder participation; project costs.

DOI: 10.1504/IJCENT.2015.073176

International Journal of Collaborative Enterprise, 2015 Vol.5 No.1/2, pp.32 - 57

Received: 19 Oct 2014
Accepted: 09 Feb 2015
Published online: 26 Nov 2015 *