Bhara Kahu project awarded at higher rate: audit report

ISLAMABAD: An audit report has pointed out irregularities in the process of awarding the contract for the Bhara Kahu Bypass project in Islamabad.

The auditor general of Pakistan’s report said that instead of an open tender, a direct contract was awarded at a higher rate for Rs7.480 billion. An inquiry should be conducted and responsibility determined, the report recommended. The report stated that the CDA’s Roads Directorate awarded the contract for the construction of Bhara Kahu Bypass on September 22, 2022, to the NLC for Rs6.515 billion under Clause 42F of the PPRA Rules on a design and build basis.

The contract was not awarded on the basis of an open tender. A time of four months was fixed for construction work. Five running bills of Rs5.440 billion were paid to the construction company, the report found. Premium was paid at 15 percent in September 2022 and 80 percent work was completed by June 2023.

The report said the project was not awarded through an open tender on the grounds that it would be completed in four months, but the construction company was given an extension of 214 days. The company’s failure to asphalt the traffic diversions according to the agreement led to accidents in which human lives were lost.

The report said the cost of asphalt was neither determined nor recovered. Two accidents occurred during construction. In one accident, two workers were killed, but no FIR was registered.

In the second accident, five girders fell on the transom while launching. The design has not been verified by a third party, the audit report said. The SOPs for construction procedures were not followed.

According to the report, the CDA awarded the contract to the NLC for the construction of a boundary wall and other works of Diplomatic Enclave, Islamabad, for Rs970.38 million in a single tender without open competition. It is 106 percent higher than the MES rate in 2021.

The contract for non-scheduled items was also awarded 21 percent more than NIT. Both construction works with a total value of Rs7.480 billion were awarded at a higher rate without an open competition, the report said.

It was pointed out that in response in July-August 2023, it was stated that the directive of prime minister was that the project should be completed in four months. Under clause 42F of PPRA Rules, bids were invited only from government construction companies.

The NLC offered a rate 15.81 percent higher than NHA schedule, which was accepted, considering it suitable in the context of inflation.

The CDA is of the view there was no option available for diversion of main traffic on Murree Road. Accidents were caused by external factors and not due to negligence of consultant.

The audit authorities rejected the CDA’s reply and said the work was done at a rate 15.81 percent higher than the NHA schedule. Also 7.5pc income tax exemption was given to the contractor.

The audit report said actually the contract cost was paid at a rate 23.31 percent higher than the estimate. The timeframe of four months given was also unrealistic, it added.