ISLAMABAD - The toll facilities on main roads, meant for revenue generation for Capital Development Authority, have incurred loss worth millions of rupees, allegedly owing to favouritism and ill planning.
The Auditor General of Pakistan have noticed serious issues of contract management from planning to execution including non-preparation of feasibility study, PC-1, adoption of standard bidding documents, execution of contract favourable to contractors, and absence of monitoring. The CDA had awarded toll collection contract to M/s TolLink Pakistan for IJP Road and Islamabad Highway toll plazas and M/s Signage for Kashmir Highway in September 2007 for five years till September 2012 on Build-Operate-Transfer basis.
The facilities at Kashmir Highway was awarded against Rs367 million and those of IJP Road and Islamabad Highway were awarded at Rs320. In 2009, M/s Signage defaulted and did not pay BOT fee of first six months of this year that prompted the CDA to take over the facility. According to the special report of Auditor General of Pakistan on the project, the CDA adopted injudicious and misleading approach by faulty estimation of revenue for five years. The CDA did not obtain Construction performance bond from the contractors for Rs28.771m to safeguard CDA’s interest, adding that delay in action against the defaulting company incurred loss worth Rs102.992m to the CDA.
Earlier, the CDA had invited the companies to operate three toll plazas on the said locations and two firms had offered bids. But later, the CDA split the offers of bidders in two parts and equated two toll plazas at IJP Road and Kashmir Highway with the one at Kashmir Highway and awarded the contract.
By splitting the contract, the CDA suffered the loss of Rs47 million, audit observed. Following decline in traffic volume at Kashmir Highway as result of ban on heavy traffic and diverting it to IJP Road, M/s Signage entered into dispute with the CDA.
The auditors observed that in case, contract for all three toll plazas had awarded to one bidder, the CDA could have avoided loss of Rs9 million due to encashment of bank guarantee by default company, loss of Rs102.992 million due to mismanagement, non-imposition of penalty of Rs36.70 million for delayed construction, loss of Rs29.898 million for not obtaining performance bond and Rs1.393 million due to payment of electricity charges by CDA under BOT contract.
According to the report, contrary to contract clauses, the concessionaires did not install weigh bridges on toll plazas and heavy loaded continued to ply Islamabad’s main roads deteriorating their condition and required heavy expenditures on repair maintenance of newly constructe3d IJP Road and Islamabad Highway.