Taking note of directives of the Bombay HC, the BMC has decided to increase the performance guarantee deposits paid by road contractors so that they deliver good results.
According to civic officials, several contractors grab road contracts by quoting figures well below the reserved bid price and then try to increase the cost through various excuses.
The municipal authority presently charges three per cent performance guarantee deposits of the total contract amount from the contractors. However, it will now be increased to 10 per cent for contractors who bid 15 to 20 per cent less and 20 per cent for bidders bidding lesser than 20 per cent.
These deposits are kept as a guarantee to ensure that even if a contractor bids at low rates, he delivers the desired quality; in case the quality is not optimum, the deposits are forfeited.
Additional municipal commissioner, SVR Srinivas said, “We have decided to up the deposits as we think this will lead to better quality road works as the contractor will not want to lose so much deposits.”
The new move is likely to prove a deterrent for contractors who bid extremely low and then dont’ deliver, said civic officials.