The government has proposed to reduce the number of interfaces between its officials and contractors to cut opportunity of graft in road construction projects. It is considering third-party monitoring and electronic payment for projects that are being implemented on engineering, procurement and construction (EPC) basis.
The changes are part of a new model concession agreement for EPC road projects being prepared by Planning Commission in conjunction with road ministry. ?Most cases of corruption occur at project design approval, quality monitoring and payment stages. If we involve third parties and utilise information technology, the cases would come down,? a senior government official in knowledge of development told FE requesting anonymity as the matter is picking heat among officials of road ministry and National Highways Authority of India (NHAI) who currently have authority to plan and monitor projects.
Incidentally, late evening on Wednesday more than a dozen chief engineers of joint secretary rank tendered their resignation. The en masse resignation was given after a meeting between officials of Planning Commission, road ministry and NHAI to discuss changes in EPC model of road construction.
The changes are proposed as the government has decided to develop national highways with total length of 20,000 km to two lanes in a time-bound manner in EPC mode. These projects are to be awarded on turnkey basis rather than current item-rate basis. An item-rate contract is one that is awarded based on cost bids for each of the item used in construction of a road. On the other hand, turnkey projects are bid out on the basis of total cost of the project.
Earlier the government was also considering restricting the number of pre-qualified bidders for EPC projects. In September 2011, it invited technical bids for two projects in Uttar Pradesh to test this provision. However, the projects failed to receive adequate bids from private companies and the matter was sent back to the discussion table.
A senior official in one of the EPC contractor said, ?Suggestions look good at first sight. However, corruption can be checked with or without these suggestions if the intention of the government is clear. If we are talking about engaging independent agency for monitoring, do we mean government officials are incompetent to do that job??.
Consultancy firm Deloitte Touche Tohmatsu’s senior director Amrit Pandurangi said, ?An independent monitoring agency would certainly help in better implementation of projects but the procedure to select the agency has to be robust. As far as e-payment is concerned, I don’t think that would help much. What is required to uproot corruption is having proper system in place where corrupt people are penalised severely?.