How just two BMC depts wasted Rs17 crore in a year

Financial irregularities by the Brihanmumbai Municipal Corporation’s (BMC) education and health departments cost the city a whopping Rs17 crore in 2010-11 alone, a recently released audit report revealed.

Financial irregularities by the Brihanmumbai Municipal Corporation’s (BMC) education and health departments cost the city a whopping Rs17 crore in 2010-11 alone, a recently released audit report revealed.

These irregularities include non-recovery of dues, excess payment to contractors, and expenditure on superfluous items.

The audit report of the education and health departments, submitted by the municipal chief auditor (MCA) to the BMC’s standing committee, revealed serious negligence and irregularities in the awarding of contracts.

It listed several cases in which the BMC awarded unqualified contractors with huge deals. Among these is a Rs11.26-crore contract to supply biodegradable plastic bags to civic hospitals. According to the report, the BMC gave the contract to Sandip Traders, which quoted Rs351 per kg, while rejecting a cheaper bid from Gunia Ventures.

According to the report, Sandip Traders not only quoted a higher price, but also violated the terms of the contract. To qualify, the firm needed to have supplied biodegradable plastic bags worth Rs1 crore to any government hospital, but Sandip Traders was unable to show proof of this. Municipal chief auditor SB Sonwane said: “We have sent our queries to the department but it has not replied yet. The lack of response raises doubts about its functioning.”

The report also cites instances in which the BMC paid contractors more than they were promised. For a minor project at KEM Hospital, the BMC paid Gyan Constructions Rs.1.71 lakh extra because of a miscalculation. In another case, it paid Rs50,668 extra to Speco Infrastructure. As for non-recovery of dues, the report cites a contract to repair a school, saying the BMC failed to recover a Rs25.77-lakh penalty it imposed on the contractor.

The civic body also spent Rs1.45 crore on signboards for all municipal school classrooms, which were never used, according to the report. Additionally, it didn’t bother to recover license fees and waste disposal charges totalling Rs80 lakh from various hotels.

“Public money is being wasted. The corporation must punish those who are responsible for the irregularities,” said Devendra Amberkar, Opposition leader.