Navarre pays almost twice the cost of the Highway of the Camino for dull tolls
- There are still ten years to complete the contract, so the House of Auditors estimates that Navarre could pay more than 1.2 billion, three times the cost of the works.
Three are the Navarre infrastructures that are paying for the shading pay system: the highway of the Camino, the Pyrenees Highway and the irritable areas of the Canal de Navarra. Shaded remuneration is the infrastructure management system used by UPN governments, a type of long-term partnership between public administration and business. The company builds, finances and manages the infrastructure. For its part, the Public Administration shall pay the corresponding remuneration to users until the end of the concession period. So the infrastructure will remain in the hands of the administration. We still have to wait until 2039.
During this period, the payments made by the Government of Navarra have largely exceeded the cost of infrastructure. The Highway of the Camino is the most representative case. The agreement was signed by the Government and the Autovía del Camino society in 2002, for a period of 30 years. At a cost of EUR 390 million and until 31 December 2021, the government has paid EUR 604 million for the remuneration of the Highway del Camino. Almost double. There are still ten more years left in the concession, so the House of Auditors estimates that Navarre could at last pay more than 1.2 billion, three times the cost of the works. Galvantula S.L.U., owner of the company since 2017, the company asks the government to modify the conditions of the concession by claiming the damage caused by the Covid-19 pandemic. The matter has come to the High Court of Justice. At the moment, there is no judgment.
The government has already paid what it did in the case of the regable area of the Canal de Navarra. In the first phase, 170 million were spent, which is what Navarre has paid for. The contract for the construction and management of the first phase of the regable areas of the Canal de Navarra was signed in 2006. It is delivered to the society Zona Regable del Canal de Navarra. Shareholders Impact Navarra S.L.U. and are the Sociedad General de Aguas de Barcelona S.A., with 50% each. The irritable area consists of 15 areas. The initial forecast was to water 23,610 hectares. The concession was signed for 30 years.
The most recent is the 2009 Pyrenean Highway contract. The infrastructure cost EUR 271 million and the government has paid for the shadow 160. Autovía del Pirineo S.A.U. The company started managing the road in 2012. Changes in shareholders of the company. Since January 2020 there has been only one shareholder: Iridiun Hermes Roads S.L. society.
It was a lawsuit about the length of the highway. The contract includes 46,097 kilometres. Construction was slightly smaller, 45,421 kilometers. The Supreme Court supported the company on the grounds that the pleadings had to be taken into account. Accordingly, the Government of Navarra has paid the company some EUR 400,000 as a supplement to be charged since the beginning of the contract. The judgment shall take effect until the contract is terminated.
Also in this case, the company requested the revision of the contract conditions on the grounds of the pandemic damage. It was rejected by the Government of Navarra. The company sued the courts. The Superior Court of Justice of Navarra rejects the appeal on the grounds that the balance of the contract has not been broken, as its duration is 30 years.
Recommendations of the House of Auditors
The House of Auditors has analysed the state of infrastructure carried out by the shaded remuneration system. And there's the data. The request for the report was made by Parliament, led by the Geroa Bai group. The House of Auditors has analysed the status of contracts, their control and the impact of infrastructure on the level of debt and future budgets.
The House warns of the technical difficulty of this type of contract and explains why the government has to delegate everything. “The extension of the contract requires very long term revisions. Consequently, issues of difficult anticipation arise. Hence the need for a new financial balance,” the chamber said.
Before making such contracts, the House has recommended that the administration draw up feasibility plans: “In those reports, it obviously has to look at alternatives for financing public infrastructure. In any event, the decision requires clear justification. It also offers clear and revised financial plans by the administration itself. The objective is that these works be carried out by the Administration itself without having to go abroad”.
It also calls for an analysis of the impact on deficit and debt accounts before signing contracts. “This justifies the use of a shadow remuneration, which was not considered debtor. And it is true that this is the case with the Highway del Camino and the Canal de Navarra. However, what was spent on the Pyrenees Highway and the first phase of the Canal is considered a debt.”
The report recommends that the Government designate representatives of motorway management companies for better financial control of these contracts. Because, although the appointment is provided for in the contract, the government has not appointed representatives since 2014.
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