Cost of BMC contracts shoots up 64% in 2 yrs | mumbai | Hindustan Times
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Cost of BMC contracts shoots up 64% in 2 yrs

The civic body’s projects have witnessed a cost escalation of 64% in the last two years, increasing by more than the original estimate in some cases, fuelling allegations of a nexus between contractors, politicians and the administration.

mumbai Updated: Oct 30, 2011 00:39 IST
Bhavika Jain

The civic body’s projects have witnessed a cost escalation of 64% in the last two years, increasing by more than the original estimate in some cases, fuelling allegations of a nexus between contractors, politicians and the administration.


The expenditure on contracts — ranging from road construction to storm-water drain projects — pegged at Rs 3,505 crore, has gone up to Rs 5,750 crore over two years, an increase of Rs 2,245 crore.

The hikes were sanctioned citing reasons such as cost escalation, increase in prices of inputs, or expansion of scope of work —called variation in civic jargon.

In simple terms, it means the original contract amounts were increased substantially instead of floating fresh tenders for the work, as required by the rules. Citizen groups are turning the heat on the the Shiv Sena-BJP-ruled BMC ahead of the 2012 civic elections by raising questions over the reckless spending of taxpayer money.

“Cost escalation has always been an official way of allotting more money to contractors close to political parties,” said Aftab Siddiqui of the H-West Ward Federation.

Municipal commissioner Subodh Kumar, who has been trying to clean up the financial mess in the civic body, said that in some cases there might be a need to increase the budget, but this should be an exception, rather than the rule.