Contractors coerced to build 2BHK houses?

With VAT added to the concession, the contractors can expect to have 12.5% of the unit cost in their hands as working capital

Is the State Government being coercive in making contractors take up works on the prestigious 2BHK houses for the poor? Forest Minister Jogu Ramanna did give that impression when he told contractors in no uncertain terms that they have to construct the houses at the cost notified by the Government.

“We are confident of getting bids for the tender for 2BHK houses in Adilabad constituency floated now,” hoped an Executive Engineer. He was part of the meeting which the Minister chaired recently to ‘discuss’ the issue with contractors.

Government help

The Minister assured the contractors of all possible help from the Government in order to lessen the chances of their making losses. Adilabad District Collector Buddha Prakash M. Jyothi, Joint Collector K. Krishna Reddy, about 10 contractors and Engineering officials from Panchayat Raj, R&B, Sarva Shiksha Abhiyan, Irrigation and Integrated Tribal Development Agency were among those who attended the meeting.

According to sources in the engineering wing, some of the contractors who pointed out that they would end up losing if they accept the unit cost of ₹5.04 lakh, were told that concession would be given by way of doing away with seignorage cess on sand and stone/metal chips. There was also a proposal to do away with the 5% Value Added Tax on the total bid amount collected by the Government and it was under consideration, they were told.

Concessions

Among other under consideration proposals to ‘help’ contractors is the waiver of the earnest money deposit and the final security deposit which works out to 7.5%. “With VAT added to the concession, the contractors can expect to have 12.5% of the unit cost in their hands as working capital,” pointed out another official.

In the first phase about 450 houses of one plus one scheme would be constructed in Adilabad urban area. In all 280 of these houses would go to the encroachers of Bada talab tank bed and the remaining 170 beneficiaries would be selected later by draw of lots.

Jainad mandal headquarters village would get 110 houses besides the 29 at Guda and 28 at Gimma. Land has been identified for the housing colonies at these places, sources pointed out.