It is a project that should symbolize the transformational
benefits of hosting the 2014 World Cup -- a sleek new monorail train gliding
above Brazil's steamy Amazon city of Manaus.
But Athayde Ribeiro da Costa
has a different take on it.
With just under 1,000 days
before the first ball is kicked, the chief public prosecutor in Amazonas state
sees the monorail as part of a trend of overspending and poor planning as Brazil rushes to make up for a slow start to
its preparations.
"We are very worried
about overspending," he said.
"We are in favor of the
Cup -- it can bring lots of opportunities for people and help resolve
infrastructure bottlenecks, but this can't be done at the expense of misuse of
public funds or corruption."
Concerns are mounting that
Brazil's push to speed up its preparations for the soccer tournament risks
fueling corruption and an explosion in costs dwarfing other
"mega-events."
Last year's World Cup cost
South Africa about $4 billion but Brazil's official estimate already stands at
about $13 billion, including transport projects, stadium construction and
airport expansions, making it certain to be the most expensive in history.
President Dilma Rousseff spoke
in March of 33 billion reais ($18 billion) in World Cup investments and some
private estimates are already way higher, putting the final bill at an
eye-popping $60 billion in one case -- bigger than neighboring Uruguay's annual
economic output.
Legal cases are proliferating
as prosecutors like Da Costa investigate suspected overspending and abuses of
bidding processes. Da Costa heads a group of 12 prosecutors focusing on World
Cup cases -- one for each host city -- and says there are more than 80 civil
investigations under way throughout Brazil.
A Sao Paulo federal judge this
month ordered work suspended on the expansion of Sao Paulo's Guarulhos
international airport, saying that bidding rules had been ignored under the
excuse of urgency. Another judge overturned that decision.
The legal cases could help
save Brazilian taxpayers a lot of money but also risk causing yet more delays
to a schedule that is already pushing the limits of just-in-time readiness.
"If you make it more
transparent you might slow it down, and therefore increase the costs,"
said Christopher Gaffney, a visiting professor of urbanism at Rio's Fluminense
Federal University. "If you don't make it more transparent, you're guaranteed
to increase the costs because everyone's going to have their hand in the
till."
Spiraling costs are a
familiar ritual of World Cups and Olympic Games. In this case, though, they are
sharpened by some very Brazilian problems -- endemic corruption, bureaucratic
and legal hurdles and high construction costs driven by a lack of capacity in
its robust economy.
REBUKES
Some projects, including
another planned monorail in Sao Paulo, are not due to be ready until just weeks
before the start of the tournament in June 2014. Delays have already drawn
rebukes from world soccer body FIFA and ruled out two of Brazil's 12 host-city
stadiums being ready in time for the curtain-raising Confederations Cup in
2013.
Work has yet to begin on five
of the 13 airports that need to be expanded for the month-long World Cup, this
soccer-crazed nation's first on home soil since 1950.
The government said this month
it was confident that stadiums and airports would be ready on time, but that it
was concerned over slow progress on "urban mobility" projects like
the Manaus monorail. Seven of the host cities have yet to start any of their
planned projects.
The risks to the fragile
timetable were rudely exposed this month when Rousseff visited Belo Horizonte
to start the 1,000-day countdown only to be greeted by a strike by workers
building the southeastern city's stadium.
Rousseff's government has injected
some urgency into its World Cup plans, rushing through Congress in July a law
that streamlines the bidding process for events related to the World Cup and
the 2016 Olympic Games in Rio de Janeiro.
That was a red flag for
transparency groups and public prosecutors, who have slammed the change as
opening the floodgates for over-spending and corruption -- already a common
problem in major construction projects in Brazil.
"The risks of having
projects without the correct procedures and transparency are rising
exponentially," said Caio Magri, a public policies adviser at the Ethos
Institute, which works to promote corporate responsibility.
"The amount spent itself
doesn't matter -- 50 billion reais ($28 billion) would be very small to make up
for what is lacking in Brazil's cities. It's not the size that's important,
it's the legacy."
Prosecutor General Roberto
Gurgel has asked the Supreme Court to declare the new bidding rules
unconstitutional, saying they risk a large-scale repeat of the Pan-American
Games in Rio in 2007, whose budget rose to 10 times the original estimate.
SKYTRAINS IN THE JUNGLE
Back in 2009, the Brazilian
Football Confederation estimated the 12 stadiums being refitted or built for
the World Cup would cost about 2.2 billion reais -- a figure that two years
later seems quaint. The government now sees them costing more than triple that
at 6.9 billion reais.
Take the overhaul of the
Maracana stadium, which will host the World Cup final. Its budget has doubled
since 2009 to 859 million reais and the TCU federal accounting authority said
in February that the Maracana's contract process had been opaque and its budget
was "verging on fiction," risking a major inflation of costs.
Gaffney calculates that as of
May stadium costs had risen by 27 percent since 2009 based on lower estimates
and by 82 percent given higher estimates. The biggest budget blowouts are
occurring in stadiums being built with public money, such as the Maracana.
With construction costs and
wages running high as annual inflation tops 7 percent, further rises seem
likely. Since January, the cost of World Cup projects has risen by more than 10
percent to 26.5 billion reais, according to a Senate study.
Da Costa, the Manaus
prosecutor, sees such forces at work in his city 4,300 km (2,670 miles)
northwest of Rio.
He calls the monorail
project, budgeted at 1.46 billion reais, "totally illegal" because it
was approved by state authorities without thorough enough studies of potential
demand, the number of stations or the fares for passengers.
He said it also
underestimated the costs -- most of which will be footed by subsidized loans
from Brazil's state development bank -- leaving ample room for expensive
add-ons during construction of the planned 20-km (12.4-mile) line.
"It will have uncountable
additions with a big risk of being paralyzed for lack of resources," he
said.
Miguel Biango, coordinator of
Amazonas state's World Cup organizing body, told Reuters that a thorough study
had been conducted and had concluded that a monorail was the best solution for
the demands of Manaus' population. He said the prosecutor's criticisms about a
lack of study on the fare structure were being evaluated.
(Editing by Kieran Murray)
Source : Reuters
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