Govt.’s tender management scandal for the benefit of select contractors: Sachin Sawant
Aarey Metro Bhavan Scam is just the tip of the iceberg
The Metro Bhavan Contract Scam needs a high-level investigation
Mumbai, August 26, 2019
While contracts worth thousands of crores are being allotted, a select few who are enjoying blessings of government are getting most of the contracts. Rules are tweaked or designed in order to benefit favourite contractors ignoring the guidelines of Central Vigilance Commission.
The rules of allotting contracts have not only been tweaked but re-written entirely. This is a classic example of crony capitalism and exposes the corruption of a government that claims to be “transparent”.
General Secretary & Spokesperson of Maharashtra Pradesh Congress Committee Sachin Sawant has demanded a high-level probe into this tendering scam.
While addressing the media at Gandhi Bhavan, Sawant said that the government bulldozed the concerns of Mumbaikars and indulged in massive deforestation at Aarey under the name of “development”. However, the people of Mumbai also did not expect that the government would replace these trees with saplings of corruption.
Guidelines specified in government contracts are modified using “corrigendum” which allows maximum contractors to participate in the tender. In this case, however, the process was entirely reversed. Restrictive guidelines were added purely to discourage any competition.
In the corrigendum related to the Aarey Metro project of the MMRDA, shocking changes have been observed.
- Height of buildings: The original conditions said that a contractor must have an experience in building structures that are basement plus 70 metres in height. In the corrigendum, however, this condition was changed to say that the contractor should have built a 100 metre structure in the past 10 years.
2 Net worth and Working Capital: Another condition originally stated that any contractor’s net worth and working capital should be more than 61 crores in the past financial year. However, in the corrigendum, this condition was modified to say that the contractor should demonstrate an annual net worth of 60 crores over the last 5 years. In addition, the only working capital needs to be positive and the contractor should be financially solvent.
- EMD: The original condition required contractors to deposit 5 crores as earnest money deposit. Of this 1 lakh was to be deposited through RTGS/NEFT/Credit Card/Debit Card while the remaining 4.99 crores were to be provided in the form of a bank guarantee. However, in the corrigendum, this condition was modified and the EMD was changed to 9.13 crores. Of this 1 lakh is to be deposited through RTGS/NEFT/Credit Card/Debit Card while the remaining 9.12 crores are to be provided in the form of a bank guarantee. An earnest money deposit is a primary condition which is tied to the overall value of the contract. Changing this amount implies a change in the value of the contract itself. In this case, the contract itself needs to be re-tendered.
- Performance security: According to clause 4.2 of the GCC, the original condition was to deposit 2% of the contract value as security. However, with the corrigendum, the deposit amount has been changed to 10% of the contract.
This means that the original deposit amount of 20 crores has now been changed to 100 crores.
- Annual Turnover: The original conditions stated that the contractor’s annual turnover should be more than 244 crores. However, this number was changed to 250 crores in the corrigendum.
Along with these conditions, several other norms laid down by the Central Vigilance Commission have been violated in this tendering process. “The changes introduced through this corrigendum are shocking and are meant to benefit a specific contractor favoured by the state government,” alleged Sawant.
Sawant has also demanded that the Urban Development Department clarify why the entire tendering process wasn’t done again instead of introducing such drastic changes through a corrigendum.
He has also said that there will soon be a revelation on how this contract is connected with a certain large contract.
