WHAT TRUE IS TRUE – FACTS ON METRO 4

In reaction to the misinformation due to inaccuracies or purposely done in the past days DBR Metro Project Directorate collected the issues frequently occurring, but, even in spite of the immediate and full information release, appearing differently almost everywhere. DBR has never stated that it builds the World's best metro with the fastest and cheapest way, but its opposite is not true either. In Hungary metros have not been built for decades, sufficient know-how was absent for a long time, preparations were slower than anticipated, but the present staff of experts can handle the technical hardships, and by now implementation works proceed with good pace and on high level everywhere, regardless of that that some companies submit unrealistic claims.
It is not true that the World’s most expensive metro is being built. Some metro constructions are cheaper, some are more expensive than the one in Budapest (diverse soil conditions, surface crowded with old buildings, presence of the Danube, etc. are raising the costs here). Not only Rome and Athens, but also France, England, Germany, Japan and the United States have had more expensive metro lines built recently, considering the average price per km, metro 4 belongs to the upper third of the middle field (if we could say that, it is 12 on a scale of 20). If we want to take objective examples, not only the Madrid and Mallorca case exist as exemplarily circulated on the Internet. (And by the way for Madrid the prices shown are that of a project calculated with net prices without metro carriages and as built by connecting existing network elements, and for Mallorca it is a small capacity beach tourist-vehicle, which after handover was needed to be closed down right away due to water leakage.)

The budget has not multiplied and the metro is not being built from 600 milliards. Now the first section comprising 10 stations and connecting Kelenföld with Baross Square is being implemented with a total budget of 353 milliard Forints. The planned second section connects Baross Square with Bosnyák Square including additional 4 stations and together with this second section the overall budget is equivalent to 517 milliard Forints, which is not 600, as it is being said by many. Commentaries comparing the budget planned 10 years ago for the first section and the price of the two sections together added with significant extra elements are frequently published. The overall budget planned now is already includes inflation of recent years, associated surface investments, costs for the vehicle depot and trains, and the contingencies from the European Union as well. It is obvious that unrealistic Contractor’s claims, similar to the one now, which by far exceeds the contingencies, make the project more expensive and exactly for this reason DBR continuously negotiate representing the interests of the city of Budapest and BKV, protecting the money of taxpayers even when facing ultimatums, and can accept such claims only, which stand for real performance or existing damage, and these are duly substantiated with sufficient documentation by the Contractor.
Construction of metro 4 did not or does not stop. Implementation of all 10 stations shows an advanced state (completed in 40 to 50%, at places in 80 to 90%) and the overall project is at about 40% completion. The south TBM also entered the future Szent Gellért Square station of metro 4 on 16th March 2009, to where its north pair already arrived at the middle of January. Now half of the first 7.5 km section of tunnels is completed and at Buda side the tunneling works are finished. If everything goes by the plans, the overall internal walls of the station and linking platform tunnels will be finished by the end of March, and then in April, following a few weeks maintenance period usual at these times, the first TBM can likely set off to the stretch under the Danube, at the end of which the Fővám Square station will likely be able to receive, with no trouble, the TBMs arriving to the Pest side. Of course this is subject to the results of the negotiations with BAMCO consortium on its 115 million Euros claim continuously ongoing until the middle of April. It is irresponsible to predict now whether a realistic agreement or termination of contract will be the conclusion, and respectively how these will influence costs and the end date. Beside the consortium building the TBM launching shaft at Etele Square, the Szent Gellért Square station with being at a significantly advanced state of completion and the tunnels several large contractors are carrying out high level works at several other stations. BAMCO stopping last summer did not mean the stop of the metro construction either, as many liked to emphasize it such way.

European Union did not suspend the decision-making process. Legally, financing is ensured without the aid as well, it is the joint task of the Hungarian State and the city of Budapest with a proportion of 79 and 21%. Development Bank of the European Union, and the European Investment Bank (EIB) have granted an extremely favorable loan for two times already, accepting the technical calculations and results. The EIB is financing the project now as well, based on the credit contract made by both the State and the city of Budapest in 2005. The tender refers to the first section costing 353 milliard Forints, for which the city of Budapest is hoping to receive an aid of some 220 to 250 milliard Forints from the European Union's Cohesion Fund with subject to the Euro-Forint exchange rate. Albeit several factors and future favorable impacts are very hard to quantify, according to the study published also on the website of Budapest last July the benefit-cost rate (B/C) is “beneficial”, as it is above 1 (1.18), in other words in principle the project meets the EU requirements, i.e. it is aidable. In August 2008 the city of Budapest through the National Development Agency (NDA) submitted the tender documentation to Brussels and then in the autumn this documentation was audited by ECORYS. From the committee in Brussels additional questions arrived in October and December, under which information with regard to the cost-benefit analysis was requested, with particular reference to the total transportation modeling of the system development plan, and also further information in connection with previous contracts and respectively public procurement procedures was asked for the purpose of assessibility due to the European competition law. In terms of procedure law in such cases the time of decision-making is obviously extended as a result of a suspension lasting until the submission of answers. Answers to the questions provided with the assistance of experts were sent to Brussels by NDA, now the city of Budapest is waiting for the decision, which can be anticipated sometime at the beginning of summer.


But we can keep listing. The same way, the station at Gellér Square was not flooded, only similarly to the other civil engineering locations the ground water was leaking into the 36 m deep Danube side station, for which reason – and also for conservation of building CH of the University of Technology – DBR made the Contractor speed up the internal wall building works. Since then both the leakage and movement of the building have settled. Or in contradiction with news a subcontractor of one of the Contractors did not transport earth illegally last year, during internal investigation the company was immediately able to show the valid permit for the dumping site. Just as the metro documentations found last summer did not get neglectfully from the hands of DBR to that garbage storage. In spite of the irresponsible alarming the buildings are safe as a result of the well considered building methodologies and the monitoring in 24/7. But despite the news the tunnel did not have to be casted back either, which was anyway a physically impossible scenario. The platform tunnels at Fővám Square are not being built from an artificial island for much higher costs, and moreover according to independent experts the bottomless lake did not start to recede due to the metro 4 project either. Unfortunately these were all such unrealistic rumors recently, which continuously, with no ground at all and lacking all sorts of objectivity, were questioning the skills of experts, clearly making the negotiations harder, which were even just representing the interests of taxpayers in these economic circumstances now.

Budapest, 20th March 2009

DBR Metro Project Directorate