Two reports, one by a committee set up by the Prime Minister, the other by the CAG, have raised serious concerns about her role. Yet, no one is asking any questions
Mihir Srivastava | 10 Nov, 2011
Two reports have raised serious concerns about her role. Yet, no one is asking any questions.
‘The conduct of the Common Wealth Games (CWG) 2010, generally, and its host city’s efforts in particular, came in for both national and international acclaim. First rate transportation in gleaming new buses and metro trains, movement of Games Family smoothly over well laid and beautifully lit roads, with minimal traffic congestion primarily because of brand new and sometimes dedicated flyovers, was widely acknowledged, not only by visitors but a majority of Delhi’s citizens themselves. Even the media evinced a general euphoria for a period, and there was a sense of proud nationalism. Thousands of officers and engineers of the city government and its civic bodies who had toiled for years had made this highly prestigious event a reality.’
The above is the first paragraph of the Delhi government’s response to a report of the High Level Committee (HLC) under former Comptroller and Auditor General VK Shunglu, constituted by Prime Minister Manmohan Singh to probe charges of corruption in various CWG projects.
While the Games are done and gone, the corruption charges will haunt Delhi’s power circles for a while yet. When former Sports Minister Mani Shankar Aiyar infamously said he would be “getting the hell out of Delhi” for the Games, last year, he sounded needlessly grumpy. Today, many might well be wishing they had followed suit.
The HLC submitted five reports: on broadcasting, the Games Village, city infrastructure, Games venues and the Organising Committee, apart from the main report on the organisation and conduct of the Games. The city infrastructure report, among other things, held Delhi Chief Minister Sheila Dikshit responsible for decisions related to projects aimed at enhancing the ‘city image’, projects that had huge cost implications.
Rejecting the report, the Delhi government—it remains a mystery, though, how a Congress state government can reject a report by a committee constituted by a Congress PM—has objected to its ‘slanderous’ choice of phrases, like ‘the stage was set for a restricted tender’, ‘subterfuge to share the spoils’, ‘method in the madness’ and ‘unusual interests’, with direct reference to Dikshit’s role, claiming this was all done to ‘tarnish’ the Delhi government’s public image. The Shunglu Committee report, Dikshit’s government maintains, is ‘shocking’, ‘blatant’ and a ‘product of paranoia’. It even suggests a motive, stating that the report has ‘tried to castigate each and every endeavour of and malign all the officers and political executives who worked selflessly’, and complains that the HLC’s conclusions were ‘pre-decided’ and based on ‘false averment, wrong surmises and conjectures’. It almost seems to suggest that the PM had set up a committee to deliberately target Sheila Dikshit and her government.
Despite the use of such strong words of rebuttal, she managed an hour-long private meeting with the PM on 28 March, where she put across the “collective feelings” of her cabinet, which she said was “deeply disappointed” over the findings of the report indicting her government.
Given the report, however, it was the PM who should have been expressing disappointment, having promised “zero tolerance” of corruption. Speaking at the Congress Plenary Session in December 2010, and again on the floor of the House in February this year, he had asserted that “anybody found guilty will not be spared”. Instead of any action, the result of the meeting is that the Union Home Ministry is currently examining a 3,400-page rebuttal of the Delhi government, point-by-point, paragraph-by-paragraph. Other central Cabinet members are involved too. Months after the Shunglu Committee report was submitted, in August the PM had constituted a group of ministers (GoM) under Defence Minister AK Antony to examine the report and responses to it by Union ministries and the Delhi government.
While that effort appears to have got entangled in bureaucratic manoeuvres, many of the charges against Dikshit have been reiterated in a report of the current Comptroller and Auditor General (CAG) made public on 2 August this year. The CAG, a constitutional auditor of government and state-
run institutions’ finances, arrived at conclusions similar to those of the Shunglu Committee report. But Dikshit remained unfazed. She deputed her top bureaucrat, Chief Secretary PK Tripathi, to defend her. “We are not saying everything [in the CAG report] is untrue,” Tripathi said on 3 August, briefing the media, but, “The Chief Minister has been wrongly blamed. She has done no wrong. It is totally wrong to blame her for anything.”
Tripathi seemed to imply that while the CAG report had got many things right, it had got everything wrong on the question of Dikshit’s role. Strangely, while Dikshit is unwilling to share any blame for all that went wrong during the Games, she was quick to take almost all credit for the success of the Games, a move that prompted Delhi’s Lieutenant Governor Tejinder Khanna to despatch a protest letter to the PM. Dikshit had dubbed this move cynical.
That Delhi’s CM is in a feisty mood is clear from the fact that she is the only politician who has taken on both the PM’s committee and CAG. Fingers, after all, have been pointed at others too. Suresh Kalmadi, who was the chief of the Organising Committee (OC), is in jail. Khanna has maintained a stoic silence. MS Gill, who was India’s sports minister at the time, was given an honourable exit from the ministry. None of them attacked either the CAG or Shunglu Committee.
Much that was in the CAG report was drowned out in the media attention that surrounded Anna Hazare’s fast. Two months later, it makes sense to re-examine the CAG observations and how they serve to question the Delhi government’s detailed yet evasive response to allegations of impropriety made by the Shunglu Committee.
Before examining specific projects, it is worthwhile to look at the overall picture presented by the CAG report. Among other things, it has observed that inexplicable delays in decision-making led to an air of ‘artificial’ or ‘consciously’ crafted urgency. The Games’ schedule could not be altered, so the threat of delays and consequent need for speed resulted in the wanton waiver of rigorous governmental procedures designed to ensure a judicious use of resources. The process of issuing tenders and contracts thus weakened, procurements were made by awarding deals to single bidders in many cases, and even on the basis of nominations in others. As a result, there was little or no competition among suppliers to fulfil these orders—conditions under which inflated costs are only to be expected. All this was translated into a huge avoidable burden on the exchequer, to the benefit of sundry contractors. The CAG minces no words, stating that the conclusion ‘is inescapable that this could indeed have even been an intended objective…’
The Delhi government, in its response to the Shunglu Committee report, had raised several issues—the multiplicity of agencies involved; the delay in obtaining funds from the Centre; and bodies such as the Delhi Urban Arts Commission sitting on project proposals for too long. But many of the irregularities in these projects that were directly under her government’s control go beyond anything attributable to delays. All these projects now face serious audit objections. There are instances of rate manipulation and overwriting on tender documents, apparently to help specific contractors or to pre-empt another round of tender submissions in the face of unacceptably high prices. Also, special provisions were introduced that ensured exorbitant profits to contractors, even as they were allowed to get away with poor quality. While delays were used as a ploy to get more money sanctioned, contractors were never penalised for their inordinate delays in completing projects.
Dikshit was part of the approval mechanism for all projects of Rs 50 crore or above. The Delhi government claims that the Chief Minister took on this responsibility ‘reluctantly’, to help overall coordination and communication, as she was already overburdened with other work. But once she was part of the process as Chief Minister of Delhi, she bears direct responsibility for how at least the major projects were cleared.
The Games were touted as a catalyst that would speed up Delhi’s development by a decade. As many as 51 ‘City Improvement Projects’ worth Rs 24,849.31 crore were undertaken. Of this sum, Rs 16,887 crore was spent by the Delhi government. The CAG selected six major projects worth Rs 2,239 crore undertaken by the Delhi government for detailed scrutiny. These were the RR Kohli Marg flyover (contractor: Afcon), Ghazipur flyover (Afcon), Barapulla elevated road (DSC), UP link road (DSC), Road No 56-Anand Vihar ISBT (Valecha), Ring Road bypass (Simplex), NH 24 flyover near the Games village (Gammon).
The projects were a bonanza for these contractors. They got higher rates than what prevailed at the time. In all, the CAG estimates these contractors’ ‘profit and overhead charges’ (largely what they made on the deals) at 37.5 per cent of project cost, in contrast to the 15 per cent norm laid down for such public works by the Ministry of Road Transport and Highways. The Delhi government has objected to such calculations, arguing that rates of material at the time of receipt of tenders and those at the time of detailed budget estimates are always at variance, but the fact remains that even the Delhi Metro, which worked under similar conditions in the same city, had capped its contractors’ cut at 20 per cent. The CAG has termed the figure of 37.5 per cent ‘inappropriate’, a multiplier of costs.
In its response to the Shunglu Committee report, the Delhi government has taken up several pages explaining the relative merits of a ‘rate tender procedure’ vis-à-vis ‘design building systems’, but it bypasses the core issue without a word. It offers no explanation for why it considered and accepted bids filed without the prescribed tender forms, a blatant violation of all set norms. The Public Works Department (PWD) under the Delhi Government awarded contracts for the Rs 435 crore Barapulla Project and Rs 235 crore UP link Road Project to a contractor named DSC Ltd (incidentally also a sponsor of the Jaipur Literature Festival). It was picked as the lowest bidder not on the basis of its official tender document, but on a lumpsum quotation submitted separately in a sealed envelope (when exactly, the CAG could not ascertain).
The CAG also found that the bid documents of Simplex Infrastructure Ltd, which was awarded the Ring Road Bypass Project, were submitted with 12 cuttings/corrections, three of which were done using white ink to overwrite key figures. Under normal circumstances, this would immediately disqualify the bid. In this case, Simplex won the contract.
The CAG report also makes many pointed references to the poor quality of work. Substandard material was used in the Barapulla Elevated Road and Ring Road Bypass, and they were neither monitored nor made to undergo quality checks. The PWD, in fact, admits as much, pleading ‘shortage of time’. But even so, the PWD, which had claimed itself satisfied with the execution of the two projects, cannot dismiss the use of steel in their construction that did not meet laid-down specifications (‘non-compliant steel’ in the CAG report’s words).
Perhaps such recklessness is best exemplified by the case of a pedestrian overbridge at the Games main venue that collapsed just days before the event. The cause was traced to ‘improper design’ by an enquiry undertaken by a technical committee. The design was the work of M/s Tandon Consultants Pvt Ltd, which had been blacklisted for two years by the Delhi Metro after a bridge section designed by it collapsed near Greater Kailash in July 2009, killing five people. The Indian Army fixed the Games bridge in one week flat—at a cost of about Rs 8.65 crore, an extra burden on the public exchequer—but that still leaves this question: why was a contract awarded to a company blacklisted by the Delhi Metro? Nothing was done against the erring consultants and contractors. Perhaps nothing could be done, as they were shielded by what the CAG calls ‘inadequate liability and lack of accountability clauses’ in the consultancy agreement they had with the government.
This was a government whose role was not restricted to contractual irregularities. Under the supervision of Dikshit, it undertook a number of projects directly as well. These have also attracted the CAG’s scrutiny.
To spruce up Delhi, 800 km of street lighting was redone at a cost of Rs 282 crore; 55 per cent of it was carried out by Delhi’s PWD. In 2007, on Dikshit’s ‘approval’, the government decided that both local and imported lights would be used. By the CAG report, the imports resulted in an extra cost of Rs 31.07 crore. The report states that the ‘imported version, in the price range of Rs 25,000-32,000, was nearly double the price of the indigenous one [with the] same technical specifications…’
The PWD insists that imported lights assure better efficiency and aesthetics, but has put nothing on record to substantiate this claim. It also awarded these contracts ad hoc, approving of suppliers on the basis of inspections by Dikshit. The Delhi government has argued that this does not show an ‘unusual interest’ taken by ‘Dikshit in this project’ and that it is a common practice for meetings on such issues to be held at a CM’s residence.
That misses the point. The objection was not to meetings held at her residence, but, as the CAG report elaborates, the absence of any technical and financial scrutiny of the bids after she had made her pick. As a result, each bidder was of a ‘vastly different repute …[and] different price ranges were selected for the same level [of illumination]’. The Delhi government has an interesting description of what happened: ‘At one stage, 29 options of the illumination level were worked out by the PWD and presentations were made before the Hon’ble Minister of Finance, Planning, UD and PWD, in the month of May 2007, and the preferred options were identified to meet the international standard of uniformity, Zebra effect and luminance.’
It was only after this that Dikshit came into the picture, the government avers, and her concern was limited ‘to the selection of aesthetically suitable luminary designs, poles and fittings, as these impact the urbanscape of the city’. However refined Dikshit’s personal sense of aesthetics may be, this was clearly an ad hoc exercise, with her whims riding roughshod over cost implications.
Even more peculiarly, it seems contractors could directly approach Dikshit. She signed and forwarded a note to the PWD’s engineer-in-chief from a company called SpaceAge Switchgear requesting her to ‘instruct’ the PWD to consider it as a tender-applicant for a lighting contract.
The PWD’s eligibility criterion that the bidder be ‘a manufacturer of international repute’ was ignored; SpaceAge was not a manufacturer, just an importer of equipment made by Saudi firm Al Babtain, with which it had no official relationship either. Initially, a board of assessors had given SpaceAge a lowly score of 48 out of 85 points, and declared it ineligible. Yet, its score was mysteriously raised to 67 later, and it won the contract. The CAG’s verdict on this: ‘unreasonable’.
In August 2008, the Delhi government decided that 3-5 million potted plants would be used to decorate CWG venues and other parts of the city for the event. On a Rs 24 crore budget, the CM approved a plan to get various state agencies started on this. The DDA, MCD, NDMC, Forest Department and Delhi Parks & Garden Society were to supply 1 million plants each, while the PWD and CPWD were tasked with 500,000 each. But when the time came, nearly Rs 24 crore was spent buying potted plants, at Rs 44–65 each, from private suppliers. If that wasn’t bad enough, it all ended in a grand farce when the Delhi Police in August 2010 refused to allow their use at CWG venues for security reasons. The government did not know that dangerous objects can be concealed in potted plants, it seems, and had not bothered to check with the police before it came up with its beautification plan.
Anyhow, the Delhi government claims that ‘the streets where street-scaping had been carried out provide a pleasant driving experience…’ and maintains that the Shunglu Committee report’s conclusion of the ‘high mortality of plants is conjectural and totally contrary to existing ground realities’. The PWD, though, has stated that of the 382,000 potted plants procured by it, 79,000 perished and most of the rest were distributed to various government offices. However, when the CAG undertook random visits to some of the offices cited, no single pot was to be found.