Ijaz Kakakhel ISLAMABAD
The National Highway Authority (NHA) has released Rs2.011 billion as payment for advance mobilization on N-55 for construction of additional carriageway as irregular award of contracts without possession of land.
The road works were awarded without acquisition and clear possession of land and the commencement letter issued after lapse of 22 to 26 months of opening of bids. According to the Audit Report for the year 2024-25, The NHA opened bids of works on March 9, 2022 and awarded project “Construction of Additional Carriageway from Shikarpur to Rajanpur and Kandkot to Kashmore of N-55 lot one and two. Total cost of the project was Rs20.123 billion for both lots, for which Mobilization Advance of Rs2.011 billion was granted to the contractors. According to the Audit Report, the Mobilization Advance was granted in April\Oct 2023 without issuance of commencement letter. Further, no utilization of the same amount was revealed from the record as well as progress report of the consultant whether the contractors were mobilized at site or not. So the retention of Mobilization Advance for almost six to 12 months is unjustifiable.
The report said, due to non-issuance of commencement letter, recovery of Mobilization Advance was not made in time. The contractors of both lots retained the Advance payment for a period of one year, resulting in blockage of public funds.
Prices of input items increased massively during the said period which could potentially result in price escalation due to poor contract management. Officials of the Audit dig out the above irregularity in October 2024, for which the NHA management replied that the mobilization advance was paid to the contractors as per contract. The land acquisition was not involved in this project but as per ADB policy, before handling over site to the contractor, encroaches/displaced persons coming within ROW (right of ways) are to be compensated under the policy. Letter for possession of land was issued on March 12, 2024 and accordingly, the letter of commencement were issued to contractors on March 14, 2024.
However, the Audit officials were of the view that the reply is not reasonable because mobilization advance was paid without issuance of commencement letter within 42 days after issuance of letters of acceptance. The physical progress of the project was 0.28 percent till June 2024 which also caused non-recovery of mobilization advance against work done. Availability of land and time taken in its acquisition is an important consideration for project implementation period. The audit report further highlighted several irregularities, mismanagement in several contracts which will be highlighted with time to time.
