Civic body paid contractor 1,300% more | mumbai | Hindustan Times
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Civic body paid contractor 1,300% more

mumbai Updated: Apr 09, 2013 03:08 IST
Kunal Purohit
Kunal Purohit
Hindustan Times
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The Brihanmumbai Municipal Corporation (BMC) willingly squandered away precious public money, nearly 1,300% more as tipping fee than what its own consultant advised it to pay to a contractor for the controversial Deonar dumping ground.

Hindustan Times has documents to show how Infrastructure Leasing & Financial Services Ltd (IL&FS) had, in December 2005, proposed that the contractor be paid Rs40 per metric ton for processing the city’s waste.

The BMC, instead, decided to pay the contractor Rs550 per metric ton, a whopping 1,275% more than the original cost. While the civic body has been blamed for approving such an inflated cost, insiders point to the discrepancies in the various escalations proposed by IL&FS.

After its 2005 report, the consultant submitted another report in January 2006, raising the tipping fee to Rs150 per metric ton for processing waste at Deonar. One year later, the firm raised the tipping fee by nearly three times to Rs445 per metric ton.

Going a step ahead, the civic body decided to grant a total of Rs 550 per metric ton as tipping fee to the contractor, UPL, for composting waste. This was in addition to the amount being paid to the contractor for the partial closure and landfill creation at the dumping ground.

As a result of this escalation, the cost of the project too went up. While IL&FS’ 2005 report pegged the total cost of the Deonar project at Rs160 crore, the final cost approved by the BMC in July 2009 was a staggering Rs4,408 crore, 2,655% higher than the original cost.

“There was rampant cost escalation even before the project could take off. The BMC officials then should have read it as a sign of things to come and changed the consultant,” said a senior civic official in the current solid waste management set-up.

This was not all. While the BMC agreed to pay Rs3,000 crores of the total cost as just tipping fees, the National Building Construction Company, a central government body, proposed to do this for no cost.

Activist Rishi Agarwal, who had filed a PIL in the issue, said, “This reeks of nothing but corruption. It’s a clear case of collusion of various stakeholders whose vested interests are involved in the issue.”