Evaluation of Risk Factors in Public Sector Construction Projects and Their Criticality to the Government and Its Contractors in Nigeria

Accomplishment of the project on time and to specifications is an objective which is mutual to both government and the contractor in public construction project. But the two of them do not have mutuality in interest when it comes to cost of the project. While the government is desirous of completing the project within estimated budget, the contractor aspires to deliver the project under budget to improve his profit margin. This study seeks to enhance the achievement of objectives on both sides of the coin, by overviewing construction project risks and evaluating them in public sector construction environment. Twenty critical construction risks were identified in literature to serve as linchpin for field data collection and subsequent analysis. Structured questionnaires were used for field data collection. Even though analysis using paired t-test indicates no significance difference in the criticality of the identified construction risks to both the government and its contractors, some data in the study proved that some risks which the contractor views as ‘very risky’, are not actually of ‘serious concern’ to the government. It is concluded that, ‘Traditional Contract’ system, the predominant type of contract agreement used in public construction projects, which divorces the government from most financial and site risks, is responsible for this variation of interest between the government and its contractors. Recommendations include among others, government to borne all reasonably substantiated hike in price and to give prominence to capabilities of contractors in bidding processes, rather than selection of the lowest bidder.

Construction Risk Factors, Public Construction Projects, Government and its Contractors.

1. Amade, B.; Ubani, E. C.; and Okoracha, K. A. (2015). Factors for Containing Failures and Abandonement of Public Sector Construction Projects in Nigeria. Journal of Building Performance. 6(1) 26-34. https://core.ac.uk/download/pdf/3334468.pdf [Google Scholar] [Crossref]

2. Andony, B. (2022) 20 Construction Risk that Contractors should be Aware of. Mycomply https://mycomply.net/info/blog/20-construction-risk/amp/ [Google Scholar] [Crossref]

3. Charles, Y. (2017). The Top 6 Types of Risks in Construction Projects. eSUB https://esub.com/blog/the-types-of-risk-in-construction/ [Google Scholar] [Crossref]

4. Donald, G. (2023). Managing Risk: Both known and unknown. 360 factors. https://www.360factors.com/blog/managingrisk-both-known-and-unknown [Google Scholar] [Crossref]

5. Duncan, T. (2020). What are the various types of risks in construction projects? Construction Placements. https://www.constructionplacements.com [Google Scholar] [Crossref]

6. Edward, G. H. (2023). Types of risk in construction projects. In Designing Building Wiki. https://www.designingbuilding.co.uk/wiki/Types_of_risk_in_construction_projects [Google Scholar] [Crossref]

7. Gerardi, J. (2021). 10 Construction Risks & How To Resolve Them. Prpest. https://proest.com/wiki/construction/tips/risk/ [Google Scholar] [Crossref]

8. Herberts, C. (2021). 7 Major Risk in Construction Projects and How to Avoid Them. PlanRadar https://www.planradar.com/builders-risk/common-risk [Google Scholar] [Crossref]

9. Ibrahim, Y. and Mosaku, T. O. (2002). Risk Apportionment in Contract Types. In T. O. Mosaku (Ed). Building in the 21st Century. (pp 274-290). [Proceeding of a Conference held at the Ahmadu Bello University, Zaria, Nigeria. September]. [Google Scholar] [Crossref]

10. Ika, L. A. (2022). Project Management for Development in Africa. Project Management Journal, 43(4), 27-41. https://onlinelibrary.wiley.com/doi/abs/10.1002/pmj.21281 [Google Scholar] [Crossref]

11. Jones, K. (2020). Construction Risk Management: Identifying and Managing Project Risks. Construcconnect. [Google Scholar] [Crossref]

12. https://www.construcconnect.com/blog/identifying-managing-construction-project-risk?hs_amp-true [Google Scholar] [Crossref]

13. Jones, K. (2022). 4 Common Risk Factors in Construction Projects. Construct connect https://www.construcconnect.com/blog/4-common-risk-factors-construction-project-risk?hs_amp-true [Google Scholar] [Crossref]

14. Johnson S. (n.d). 3 Risk of Bidding Too law on a Project. Cotney Attornys & Consultants. https://www.contneycl.com/3-risks-of-bidding-too-low-on-a-project/ [Google Scholar] [Crossref]

15. Kat, E. (2022). A Guide to Project Risk: Categories, Types and Expert Advice. Smartsheet. https://www.smartsheet.com/content/project-risk-type [Google Scholar] [Crossref]

16. King, M. E. and Manu, R. (2020). Project Failure in Developing Countries: A Review with particular Reference to Nigeria. Global Journal of Social Sciences 19(1) 35-47. https://www.ajol.info/index/php/gjss/article/view/193911/183180 [Google Scholar] [Crossref]

17. Machina, M. A. (2003). Risk Management in Public Sector Construction Projects. Yamtara-Wala Journal of Arts, Management and Social Sciences. 5(2) 451-458. Online: 2971-5016. Print: 2971-5008. [Google Scholar] [Crossref]

18. Machina, M. A. (2006). An Appraisal of Current Practice in the Development and Implementation of Public Sector Construction Projects in Nigeria. (A Case Study of Selected States). [Unpublished doctoral dissertation, Ahmadu Bello University, Zaria] [Google Scholar] [Crossref]

19. Malsam, W. (2020). Construction Risk Management: An Introduction. Project management. https://www.projectmanagement.com/blog/construction-risks/management [Google Scholar] [Crossref]

20. Maxwell, N. S. (2021). 12 Common Risks in Construction Projects. Blackridge Research https://www.blackridgereseach.com/blog/common-risk--construction-projects [Google Scholar] [Crossref]

21. Nnamdi, N. (2016). Failure of Public Infrastructure Projects in Nigeria: Causes, Effects and Solutions. Texila International Journal of Management. 2(2) 42-54. https://www.texilajournal.com/thumbs/article/Management_Vol%202_Issue%202Article_4.pdf [Google Scholar] [Crossref]

22. Olulusi, O. and Otunola, A. (2021, March 24-25). Abandonment of Building Project in Nigeria: Review of Causes and Solutions. [Paper Presentation]. International Conference on Chemical, Civil and Environmental Engineering (CCEE 2012). Dubai, United Arab Emirate [Google Scholar] [Crossref]

23. Okotie, F. (2021, January 12). Government Project Failure in Nigeria. Business Day. https://businessday.ng/columnist/article/government-project-failure-in-nigeria/ [Google Scholar] [Crossref]

24. Paul, S. (2022). Construction Risks: Major construction risks you need to think Sitemate. https://sitemate.com/resource/articles/construction/construction-risks/ [Google Scholar] [Crossref]

25. Scalisi, T. (2021). 10 Common Construction Risks (And How to Manage Them). Levelset. https://www.levelset.com/blog/10-common-construction-risks/ [Google Scholar] [Crossref]

26. Ward, V. N. (2022). 12 Construction Project Risks (And How to Prevent Them). Indeed. https://www.indeed.com/career-advice/caree-development/construction-project-risks [Google Scholar] [Crossref]

• The Indirect Effect of Liquidity and Activity on Company Value with Profitability as an Intervening Variable
• Effect of Financial Skills, Knowledge, and Attitude on The Financial Behaviour of Clergy
• A Decade of Review: Trends in Budget Execution and Financial Performance of Development Projects in Tanzania (2014/15-2023/24)
• The Influence of Pre-Project Planning on the Budget Absorption Rate of Public Funded Infrastructure Projects in Kenya a Comparative Case Study of Narok, Migori, and Kisii County Government Projects
• Assessment of Factors Influencing Digital Transformation in Hotels’ Facility Management in Abuja Metropolis, Nigeria