Costs for new subway line in Bucharest, EUR 40 mln higher due to contracting deficiencies

Deficiencies in the contract for the new subway line that connects Bucharest’s Drumul Taberei residential area to the city center generated extra costs of RON 188 million (EUR 40 million), the Transport Ministry’s control body determined following a control carried out in August. The contract was poorly managed from the start as its value was initially underestimated after which it was significantly increased, which hints to a possible fraud, according to the control body’s report. A local court ruled in September that the subway operator Metrorex must pay EUR 40 mln worth of penalties to the consortium of companies that built the subway line to Drumul Taberei, which is led by Italian group Astaldi. The total cost of this line, which isn’t functional yet, amounted to EUR 700 million, part of which was covered with EU funds. The control’s conclusions were announced on November 22, when transport minister Lucian Sova also announced his resignation. Sova lost his party’s support for this position but president Klaus Iohannis rejected the Social Democratic Party’s nomination for his replacement, namely former labor minister Lia Olguta Vasilescu. The resigning minister also announced that another control carried out at the state-owned rail freight carrier CFR Marfa showed the company may have lost RON 19 million (EUR 4.1 million) following a public tender for coal transport. CFR Marfa lost that tender by not using all its options, thus favoring the other bidder. The Transport Ministry has notified the prosecutors about the results of the two controls. editor@romania-insider.com