Delhi govt to increase performance guarantee in PWD tender rules

New Delhi, Jul 30 (PTI) Delhi Minister Parvesh Verma on Wednesday said the government is set to increase the performance guarantee limit in future tenders of the Public Works Department (PWD) with an eye on timely and better execution of infrastructure projects.
     A performance guarantee is a clause in all tenders as per which a contractor taking up any work of the PWD deposits a certain amount depending on the project's estimated cost.
     "When a contractor quotes an unreasonably low amount and then fails to deliver, it is the common man who suffers due to project delays and poor infrastructure. Our goal is to ensure that every rupee spent translates into durable, timely and high-quality public works," Verma said.
     According to officials, the Additional Performance Guarantee (APG) will be over and above the existing security deposit and performance guarantee requirements. This amount deposited in advance will only be returned to the bidder after the work executed is completed as per the satisfaction of the engineer in charge.
     "Currently, this deposit is around one per cent of the tender cost, but we are planning to increase it to 50 per cent of the tender amount in cases where bids by the contractors are found to be abnormally low. A final decision on the increase is yet to be taken," informed a government official.
     According to officials, the PWD studied existing models and tender conditions in the other states of Uttar Pradesh and Odisha.
     "We also looked at the Ministry of Highways and their performance guarantee, and after that we decided to make these changes. The primary goal is to eliminate speculative bidding to ensure only capable contractors participate and improve overall efficiency and quality of public works," they said.
     Verma has also directed that a training session should be conducted for the PWD officials and the changes in the tender be incorporated in all future tenders and internal guidelines be updated accordingly.

(This story has not been edited by THE WEEK and is auto-generated from PTI)