A new government order banning allocation of civil works on negotiation basis in local bodies will hit the Kochi Corporation, which is struggling to complete its annual projects.
The civic body could achieve only 30.95% spending on annual plan projects for the current fiscal. The reluctance of contractors to take up civil works, including construction works in Kochi, has been highlighted by civic administrators as one of the reasons for the poor spending.
Earlier, the government had permitted the local bodies to allot works, for which there were no takers, after negotiating with the contractors. The civil works for which tenders were floated twice were thus implemented by negotiating with the contractors. The new directive has come at a time when the civic body is left with 130 days for utilising ₹113.57 crore, the annual plan allocation from the State government. Till Tuesday, the local body could spend only ₹35.15 crore.
The unspent amount will be deducted from the State allocation next fiscal.
With the new government order, the practice will come to an end. Besides affecting the implementation of projects, the non-completion of works would also reflect on the annual performance of the civic body, said Mayor Soumini Jain.
On their part, the contractors have been complaining about the delay in getting the bills of completed projects cleared, the increased price of raw materials such as bitumen and the technical hassles in the implementation of projects. There has been a minimum delay of around two years for getting the bills of projects cleared. The civic body raises funds by way of overdraft from banks for part payment of bills.
The new government order has thrown up an unprecedented crisis for the Kochi Corporation. Already a few projects that could not be completed during the last fiscal are pending. The new directive would further upset the plans of the local body, said Ms. Jain.
The Mayor said government intervention was required to solve the crisis. The civic body would approach the government with a request for restoring the earlier system, she added.
