Three Gorges contractors overpaid 488m yuan, auditor finds

PUBLISHED : Saturday, 30 June, 2007, 12:00am
UPDATED : Saturday, 30 June, 2007, 12:00am

Contractors working on the Three Gorges hydroelectric power project have been overpaid by about 488 million yuan, the National Audit Office said yesterday.

In the first overall audit of the project since it started in 1993, the office found 483 million yuan was given to contractors who exaggerated their expenditures or received unnecessary bonuses. In addition, 5.4 million yuan was wasted on surveying mistakes, said Pan Xiaojun, director of the office's investment department.

'So far, most of the found problems have been rectified,' Mr Pan said. 'About 129 million yuan has been recovered, and 17 regulations are being created or improved to reinforce construction management.'

While the overpayments account for around 0.4 per cent of the project's 122 billion yuan total cost, Mr Pan said the audit did not find serious embezzlement and the funding was generally directed properly.

He said the project would be within budget, and its 'dynamic investment' - things affected by changing costs - would be 78 billion yuan, 35 billion yuan less than 1994 estimates.

The office also found that 20.4 hectares of land had been used without government permission, and another 110 hectares approved for use had lain idle for years.

An area of 2.1 sq km, or a third of the project area affected by soil erosion, had not been treated, the office said.

The office randomly checked 1,448 construction supervision staff from six companies and found more than half were working without appropriate qualifications.

The government has promoted the dam as a way to control devastating flooding on the Yangtze River and as a clean power source as the mainland tries to cut its heavy reliance on coal. The project is scheduled to be fully operational by 2009.

The left bank of the dam began generating power in 2005, and turbines on the right side started sending their first electricity to the power grid earlier this month.

Not super supervisors

Percentage of inspected construction supervision staff that were unqualified 51%