After corruption case closure, BJP flags ₹650 crore escalation in LN hospital project under Jain’s tenure

PWD minister Verma said the findings have been submitted to Lieutenant Governor VK Saxena, who may refer the matter to the Central Bureau of Investigation (CBI) or the Anti-Corruption Branch (ACB) for further inquiry.

A day after former minister Satyendar Jain was given a clean chit in a corruption case, the Bharatiya Janata Party (BJP)-led Delhi government has levelled fresh allegations of irregularities in the construction of a new block at Lok Nayak (LN) Hospital — including procedural violations, statutory lapses, and a ₹650 crore cost escalation.

The project was originally sanctioned at ₹465.5 crore. However, successive changes allegedly pushed the cost up by 243% to ₹1,139 crore. According to the PWD, ₹445.86 crore — roughly 96% of the original tender value — has already been disbursed, while construction is only 40% complete. (HT Archive)

Speaking in the Delhi assembly on Tuesday, Public Works Department (PWD) minister Parvesh Verma claimed that the project budget ballooned during Jain’s tenure as both health and PWD minister, with several changes allegedly made at the behest of then chief minister Arvind Kejriwal.

Verma said the findings have been submitted to Lieutenant Governor VK Saxena, who may refer the matter to the Central Bureau of Investigation (CBI) or the Anti-Corruption Branch (ACB) for further inquiry.

“The sanctioned budget for the LN Hospital project was increased by ₹650 crore. We found that Jain, who was both health and PWD minister at the time, made multiple site visits and got several changes implemented for the benefit of the contractor,” Verma said.

The project was originally sanctioned at ₹465.5 crore. However, successive changes allegedly pushed the cost up by 243% to ₹1,139 crore. According to the PWD, ₹445.86 crore — roughly 96% of the original tender value — has already been disbursed, while construction is only 40% complete.

The PWD report alleges that the consultancy contract for the hospital expansion was awarded on a nomination basis — without a tender process — bypassing norms under the General Financial Rules (GFR). The consultant was reportedly appointed at the insistence of the then health minister, in violation of mandatory bidding procedures.

The initial agreement pegged the consultancy fee at ₹5.62 crore for 90,000 square metres (sqm). However, the covered area was later allegedly increased to 162,490 sqm, raising the fee to ₹10.15 crore.

PWD officials said the same consultant was also given additional work for upgrading dispensaries and other buildings — again on nomination terms — despite objections from the finance, planning, and law departments, all of which noted that statutory compliances had not been met.

“This singular act of the minister-in-charge led to the catastrophic collapse of due diligence and oversight in the project,” the report notes.

The report further alleges that the consultant failed to conduct basic soil investigations, did not prepare a detailed project report (DPR), and proposed multiple structural options without financial analysis. In addition, the grade of steel used in the construction was allegedly changed after the contract award, inflating the project cost by nearly ₹200 crore.

The AAP, dismissing the allegations, said in a statement: “The BJP and its ministers are obsessed with the ACB, CBI, and ED. Just a day ago, the court taught them a lesson by closing one of the CBI cases against Satyendar Jain.”