State Audit Raises Concerns Over Pune Municipal Corporation’s 24×7 Water Supply Project

The state government’s audit department has voiced apprehensions regarding Pune Municipal Corporation’s (PMC) ambitious 24×7 water supply project, as per a draft report spanning from 2018 to 2021.

Submitted on April 4 to PMC by the local fund audit office in Navi Mumbai, the report questions several aspects of the project, including transparency, financial losses due to delays, contract violations, and unclear objectives.

PMC initiated this project to reduce water leakages in the municipal distribution system by 40% and ensure a balanced water supply over the next 30 years. The estimated cost stands at ₹2,818.46 crore.

Approved in May 2015, the project commenced groundwork in 2018 after appointing a consultant and devising a plan. The standing committee sanctioned a loan bond of up to ₹2,264 crore on June 30, 2017, with flexibility for additional funds. PMC secured a ₹200 crore loan for the project.

During the audit period, ₹348.75 crore was withdrawn from the project’s deposit account. However, concerns arise due to missing documentation on bond purchase rates and repayment terms, casting doubt on transparency.

Additionally, the report notes discrepancies in the financial plan’s accessibility and highlights ₹148.75 crore as unaccounted from the approved ₹200 crore for debt securities.

A senior PMC official from the accounts and audit department stated, “It is a routine audit process. We’ve received the primary report from the state government and have forwarded it to relevant departments for compliance.”

Regarding the irregularities in the Parvati Water Treatment Plant (WTP) tender process, the audit reveals a delay in issuing the first work order after tender approval, violating contract terms.

Moreover, the audit points out duplicity in billing for debris removal, where the water supply project contractor undertook the task instead of the designated solid waste department contractor, resulting in double payments.

Furthermore, the report indicates a shortfall in the contractor’s performance guarantee, with only ₹1.67 crore deposited out of the required ₹295.65 crore.

Lastly, the audit criticizes the extension of the project’s completion period without penalties until November 24, 2023, exceeding the initial contract duration.