Day-to-Day Management of an Independent Road Fund Administration
The oversight arrangements are probably the most important elements associated with setting up an independent road fund administration. A strong oversight board can overcome many other impediments – including weak legislation, ministerial interference, etc. – while a weak board can fail in spite of having all the other required features. The oversight board performs three main functions: (i) it raises public awareness of the need for more revenues to support the annual road program (i.e., it has an important PR function); (ii) it helps to build public confidence in management of the road fund (i.e., it helps to ensure that funds are spent on roads and do not simply end up in an off-shore bank account); and (iii) it promotes effective management of the funds raised (i.e., it helps to ensure that the funds raised produce value-for-money).
The oversight board can either advise the minister on management of the road fund, or can manage the road fund in an executive capacity (see Box below for an explanation of the difference between advisory and executive roads boards). Although it is better to have an executive board, advisory boards have their place and can be highly effective – particularly on an interim basis – provided they have the right membership. Zambia has an unusual arrangement where an Advisory Board has been delegated responsibility for managing the road fund in a non-executive capacity. It is primarily the broad-based and representative composition of these boards that makes them work.