E-Paper
Audit raises concern over PMC’s 24x7 water project
The audit report was submitted by the local fund audit office of the state government in Navi Mumbai to PMC on April 4
The audit department of the state government has expressed concerns about Pune Municipal Corporation’s (PMC) 24x7 water supply project in the draft report for the period between 2018 and 2021.
The audit report was submitted by the local fund audit office of the state government in Navi Mumbai to PMC on April 4.
The report questions the transparency of the project process, financial losses due to delay in implementation, violation of contract terms and conditions, unclear objectives, double costs for removal of debris, etc.
PMC has undertaken an ambitious plan to curb 40 per cent of leakages in the municipal water distribution system, aiming to achieve a balanced water supply. The plan, devised with a perspective of the next 30 years and comes with an estimated cost of ₹2,818.46 crore.
The scheme received approval in May 2015, and the actual groundwork began in 2018 following the appointment of a consultant and project planning.
The standing committee approved a loan bond of up to ₹2,264 crore on June 30, 2017, for the project. Additionally, flexibility was allowed for additional funds, up to 20% of the approved amount. PMC took a loan of ₹200 crore for the project.
During the audit period, an amount totaling ₹348.75 crore was withdrawn from the deposit account for the project. However, concerns arise as documentation regarding bond purchase rates and repayment terms are unavailable, raising doubts about the transparency of the process.
Of the approved ₹200 crores for debt securities, ₹148.75 crore seem to be unaccounted, as per the report.
Besides that, the financial plan for the water supply scheme was approved; the audit did not have access to a copy of the plan.
One of the senior officials of the PMC accounts and audit department, said, “It is a regular exercise of audit. It is the primary audit report which we received from the state government. Now, we sent a report to all concerned departments on which the state raised objections.”
“We instructed the department to file a compliance report on the objections. After receiving the compliance report, we will submit it to the state government audit department,” he said.
Irregularities in Paravati WTP tender process
After PMC sanctioned the tender Parvati water treatment plan (WTP) on March 23, 2011, the agreement for the tender terms and conditions should have been made first. Then, the work direction was supposed to follow. However, there was a delay of a month in issuing the first work order, as per the audit report.
Since the terms and conditions of the contract are obligatory for the contractor, the contract should have been signed before starting the work, which means the contract terms and conditions were violated.
Meanwhile, the solid waste department has appointed a contractor to pick up the development works/construction works generated debris in the city and transport it to the processing plant. In which the contractor of the solid waste department of the PMC pays the contractor for the service. The contractor of the 24 x 7 project of the water supply department carried out the laying of new water pipes. But, instead of giving the task of lifting the debris to the contractor of the solid waste department, the 24 x 7 project contractor lifted the debris and PMC paid an amount of ₹65.25 lakh to the contractor of the water supply department. Due to this, the state government has mentioned in its audit that the same work was billed twice.
The contractor was supposed to deposit a performance guarantee of ₹14.75 crore to PMC in the form of a five per cent bank guarantee, totaling ₹ 295.65 crore. However, only ₹1.67 crores were deposited, which is significantly less, as per the report.
The report also highlighted that the project completion period is five years with an additional ten years for maintenance and repair. The contract ended on February 22, 2018, but it was extended up to 24 November 2023 without penalty for five years and nine months.
