Rs 670 crore cost rise for LNJP hospital block: Delhi LG for CVC probe

NEW DELHI: Taking note of loss of public money due to “procedural violations”, leading to a huge cost overrun of Rs 670 crore in the construction of a new block of the state-owned Lok Nayak Hospital, LG VK Saxena has approved a proposal to refer the case to central vigilance commission for a detailed technical examination.
The LG has also constituted a committee to examine procedural violations which led to the increase in cost.The committee, which will submit its report within two months, will also examine all such ongoing projects in different Delhi govt hospitals.
The cost of building the new block was initially pegged at Rs 465 crore but increased to Rs 1135 crore, an escalation of nearly 143%.
“It is beyond justification that such huge cost overruns were effected at the level of the engineers of the department though it should had gone to the finance department and the cabinet,” the LG said in his note.
Addressing a press conference, Delhi health minister Saurabh Bharadwaj slammed the LG for ordering inquiries. “The LG orders inquiries day and night. What other work has he done for Delhi? The vigilance department is under him. He does this so that the media asks us (AAP govt) questions,” Bharadwaj said.
Welcoming the inquiry, Delhi govt sources said if there was any illegality, the officers concerned should be punished. “In his note, the LG is himself saying that the cost escalation happened at the level of officers without the knowledge of govt. We welcome any inquiry into this matter and strictest punishment should be given if any illegality is found,” said a Delhi govt official.
“These officers are directly under the control of LG. The vigilance department is directly under LG. He and his department should have been more proactive instead of coming into action after media reports,” the official added.
The hospital’s new block, which is being constructed by PWD, will have 22 floors with 1,427 beds and will have a parking capacity of around 400 vehicles. Construction was scheduled to start on Nov 4, 2020 and get completed within 30 months. The LG’s office claimed only 64% work has been completed so far. PWD attributed the cost overruns to increase in the scope of work, officials said. The LG has in his note to the chief secretary asked the directorate of vigilance to request CVC to constitute a special team of chief technical examiners to conduct a detailed examination in the case.
Raj Niwas officials said LG wrote to CM Arvind Kejriwal on June 22, 2023, flagging reports of “inordinate delays” in hospital projects highlighting cost overruns running into crores of rupees. They added that it was only after this communication that the health department moved a cabinet note in March 2024 for endorsement/approval of the cost overruns in the case.
The LG also mentioned that a dispute between PWD and the private construction company engaged for the work had arisen following which an arbitral tribunal constituted for adjudication gave an award of Rs 82.45 crore in favour of the contractor. However, PWD chose not to challenge the award that further increased the financial burden.
The LG has also asked for formation of a four-member committee, headed by retired IAS officer BK Prasad, to undertake a detailed examination of the matter.