BMC trenching contracts: Errant contractors do U-turn, bid higher than estimate

  • Kunal Purohit, Hindustan Times, Mumbai
  • Updated: Jan 27, 2015 22:03 IST

A group of civic contractors, who had earlier agreed to work for rates as less as 60% lower than the civic body’s estimate, have done a U-turn. They are now asking for rates higher than the estimate.

Hindustan Times had reported how contractors vying to fill trenches dug by utility companies had claimed they will be able to do the job at rates that were 55% to 60% lower than the Brihanmumbai Municipal Corporation’s (BMC) estimate for the job. This means that if the BMC estimated the job would cost Rs 100, the contractors claimed they could do the work for Rs 40.

Experts and citizen groups have objected to the BMC working with such contractors. They have raised concerns over the contractors’ poor quality of the work and also the practice of escalating the costs after bagging the contracts.

The civic body had recently cracked the whip on such contractors by scrapping trenching contracts worth Rs 350 crore contracts and floated fresh tenders.

However, of the seven contractors who had bid between 55% and 60% lower than the BMC’s rates, only three have submitted fresh bids and have been short-listed. The only difference being, this time, they have asked 3-5% more than the civic body’s estimates of the work. This is significant because they were willing to work for a lot less previously.

Civic officials met with these contractors on Tuesday and sources said negotiations are on to try and get them to reduce the rates.

For instance, API constructions had claimed it could carry out the work at a cost that was 59% lesser than the BMC’s estimate of Rs 50 crore. However, in the new tender, the same company said it will now be able to carry out the same work at a cost that is 5.4% higher than the BMC’s estimate. Similarly, ME Infrastructure had previously quoted a rate that was 59.5% lower than the civic estimate. In the new tender, however, it has asked for 3% more than the estimate. Even Dev Engineers, which had agreed to complete the work at a rate that was 55.10% lower than the official estimate, has now bid 3.42% higher than the BMC’s rates.

A representative of Dev Engineers denied manipulation and said, “The rates have increased since the BMC threatened to take away our deposits if the quality was shoddy. They have also decreased the area of the trench.”

Arvind Jain from API constructions, claimed the civic body's waivering norms were to be blamed for the fluctuations. “They have changed the materials that we could use and have also said they will forfeit our deposits if our work is not upto the mark. Hence, the rates went up.”

ME infrastructure said they will respond to HT’s queries soon.

Activist Abhay Hirani, who has written to BMC chief Sitaram Kunte alleging a syndicate between the contractors, said the rates showed manipulation. “All the rates are mysteriously close to each other. There is little doubt that this reeks of a syndicate between all the contractors in an attempt to ‘fix’ the contracts.”

Additional municipal commissioner SVR Srinivas said they had not found any evidence of such a nexus yet. “I have asked my officials to negotiate with these contractors and ensure they don’t overcharge us for the work. The change in the rates could also be because we had reduced the volume of the trenches that can be dug. Hence, they may have quoted higher rates.”

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