Belated wisdom | Municipal commissioner’s latest circular says no increase above 5% of the original cost will be allowed now onwards
Mumbai: The Brihanmumbai Municipal Corporation (BMC) just got wiser – on awarding road contracts.
Now on, no contractor will be allowed to escalate the cost of contract above 5% of what was originally agreed.
What got civic chief Ajoy Mehta’s goat was what happened during the construction of the Ramdev Peer Marg in Vidyavihar. The contract for constructing the 1.5-km road in cement concrete was awarded to RPS Infra in 2010 for Rs 128 crore.
However, its costs escalated 13% and the civic body had to shell out Rs 142 crore so far. The project, though yet to be completed, has already got the tag of the costliest road in the city.
Officials attributed the escalation to a massive delay in clearing a bottleneck in one location of the road, connecting Kurla (West) and Vidhyavihar (West) railway stations.
Though the road was marked in the city’s Development Plan (DP), the plan never took off and it remained a mud road for years. A parch of land earmarked for the road was with the state transport corporation. That was the hurdle.
Mehta has now issued a circular capping cost escalations at 5%.
Congress legislator Aslam Shaikh, who had exposed several irregularities in road-work contracts, hailed the move. “This is a good move since contractors loot the BMC by escalating the cost of the work after bagging the contract. The municipal commissioner must now clean up the entire tendering process. The roads department should be cleaned up first since it sees maximum irregularities in tendering,” he said.
Worry not Shaikh, officials are waking up. Listen to this. “Here on, once the work order is awarded, no extension will be given. All work will have to be completed in a time-bound manner. In case there is a delay, officials have been asked to prepare a new tender in advance, so that another contractor will be available,” said a senior civic official.
That may not convince Shaikh. For, widespread variation in costs is nothing new. In fact, the Comptroller and Auditor General had, in 2012 itself, alerted about contracts without invitation of tenders leading to cost variations.
Between December 2009 and October 2011, the CAG report had revealed that 147 works of concreting and asphalting were awarded to the same contractors without calling tenders. Of these, 59 works recorded cost variations of Rs 750 crore. The cost of CC works surpassed the original estimate by 62% and of asphalting works by 57%.
Mehta’s latest circular states that only in case of an emergency will the contractor be allowed to escalate costs from now onwards. But will the BMC tell us whether action will be taken against erring officials and contractors, especially after the CAG alert?
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