Corporation officials blame it on intense competition

While GVMC contractors struck work from Friday protesting against delay in payment of bills, officials say the problem is self-made due to competition among contractors.

“For nearly one-and-a-half-years now, contractors have been quoting 25 to 30 per cent less of the tender rate for getting the works. Earlier, if less (than the tender amount) was quoted, it was around 5 per cent,” says an official. The value of such works will be anywhere up to Rs.50 crore. For years now, bills are being paid in five to six months and delay is not the main issue, he maintains.

Since they are not able to execute works at the rates at which they quoted, they are citing delay as the reason for going on strike, he says.

Contractors, while admitting that quoting less rates is part of the problem, say the main reason for the strike is delay in payment.

GVMC Contractors' Association president Rongali Jagannadham has attributed the problem mainly due to delay in the engineering section. However, he admits that quoting at much less than the tender rates has created some problem. About 20 to 30 per cent of the works can not be completed because of that and he estimates that their value will be around Rs.20 crore.

Cement rate

It's difficult to complete the works for which tenders have been accepted when the cement rate was Rs.200 a bag and same shot up to Rs.300 now, says association honorary president D. Narayana Reddy. The standard schedule of rates for 2009-10 is still being implemented though it has to be changed from June every year. Officials, however, point out that the retaining EMD for one year for maintenance works and two years for capital works is being done as per government rules that prescribe defect liability period.

  • Delay in payment of bills the trigger
  • ‘Contractors quoting 25 to 30 per cent less than the tender rates'