The BMC had in 2020 floated tenders to sell scrap that the various BMC departments generated. The contractor is supposed to collect the scrap and then pay fixed rates per kilo of metal. However, BJP corporator Vinod Mishra has in a written complaint to municipal commissioner Iqbal Chahal said that the BMC was selling scrap from its British era pipelines at a rate that is much lower than the market price. The BMC is selling scrap pipelines for around Rs 32 crore.
The BMC is facing a cash crunch due to falling revenues. It is time the BMC comes clean on allegations of a scam in selling of scrap metals. The BMC must ensure that it updates the prices of scrap metals more frequently given the steep fluctuation in prices of metals in the market. Instead of a fixed price for two years, the civic body must have annual rate revision and all public procurement norms must be followed.
“The BMC has given an additional contract of Rs 32 crore as the rates from 2020. In 2021 the rates of metal are at an all-time high. Despite this, the BMC is choosing to sell its metal scrap at 2020 rates. This will result in a loss of Rs 5 crore to the BMC. There are vendors in the market who are ready to pay much more than the price the current contractor is offering. So the contract given to M/s Asifo Technologies must be put on hold and no work order must be issued,” Mishra said in his letter. The scrap includes two unused aqueducts of 1,800 mm, weighing 70.68 lakh kilos. Officials said that the decommissioned aqueducts on the Tansa east and west sides from Bhandup to Powai were replaced as well, and the scrap weighs 29.50 lakh kg.
Mishra said the BMC can’t give out an additional contract for such a high value without floating fresh tenders. “It is a violation of public procurement norms. I have asked for variation committee minutes of meetings. This kind of award of contract is illegal and arbitrary. It is daylight robbery of taxpayers money,” Mishra said.
Officials said they had fixed the rates for metal scrap for two years. “We had fixed rates for two years. So this contract was given according to rates fixed. The contractor has been given a contract to dispose of all scrap from all BMC departments. So there was no need to float fresh tenders for this scrap. If any contract gives a higher rate after a contract is awarded, it has no meaning,” said an official.
The scrap metal contract was awarded by BMC’s Mechanical and Electrical department. Officials said in 2020, BMC expected Rs 18 per kilo for scrap metal but current contract and bid around Rs 32 per kilo.