Cause for concern: Contractors may compromise on the quality of roadworks owing to delay in payments, says a forum member.
| Photo Credit: Special Arrangement

Payment arrears to contractors since April 2024 has affected the quality of storm-water drain projects and roadworks, increasing the risk of flooding and worsening the condition of roads, residents complain. The Greater Chennai Corporation (GCC) acknowledges the problem, and pins the blame on the lack of funds.

The Builders’ Association of India (BAI), Southern Centre, submitted three petitions last year — on April 29, June 27 and August 28 — to the GCC, raising concerns over delay in payments. “Contractors are not receiving payments on time. This impacts their cash flow and project timelines. We request timely disbursement of payments to facilitate smoother operations,” a petition from N. Lokanathan, chairman, BAI, Southern Centre, read.

Despite completing works related to various schemes, payments were not settled, exacerbating the financial strain on contractors. After receiving a Letter of Acceptance for new package schemes, contractors began work despite financial difficulties on the insistence of officials. An abnormal delay in processing Project Management Consultancy bills added to their financial burden, the petition sent in August added.

Vice-Chairman of the centre, R. Nimrod, said: “Till August, some funds were disbursed. After that, there has been a delay. Roughly, arrears worth ₹300 crore is pending with the GCC. Contractors are undertaking roadworks under schemes such as the TURIP [Tamil Nadu Urban Road Infrastructure Project], the SFC [State Finance Commission] and the NSMT [Nagarpura Salai Mempattu Thittam] despite financial constraints…” Rama Rao, president, Greater Chennai Corporation Contractors’ Association, said that since April 2024, no funds had been disbursed to contractors who were roped in for constructing storm-water drains along the Kovalam Basin (funded by German bank KfW) and Kosasthalaiyar Basin (funded by the Asian Development Bank (ADB)). The amount may add up to over ₹500 crore in total.

Raghukumar Choodamani, of the Perambur Neighborhood Development Forum, said payment arrears would affect roadworks across the city.

“The Patel Road, which was re-laid recently, got damaged due to poor quality. Contractors may compromise on quality [of work] in case of non-payment [of dues]. The storm-water drain near Murasolimaran Park caved in after a heavy vehicle passed over it,” he added.

Somasundaram R. from Alwarpet said the roads leading to Duraisamy Subway and Aranganathan Subway, and the service lane under the flyover near Sir C.P. Ramaswamy Road, which had been relaid around three months ago, are now damaged. “Only 75% of the interior roads are milled, so the height is uneven. Manholes and silt catch pits are closed. Within six months, a new tender is called to relay roads; so there is a lack of accountability. Quality checks before and after the roads are laid — such as inspecting the 6-mm maximum height — are not done..,” he alleged.

He called for more transparency in the tender system by consulting residents, and steps such as checking qualifications of the contractors, among others.A senior official of the GCC acknowledged that there were payment issues for certain schemes. “Payment issues also exist with the ADB and the KfW funds. A revised administrative sanction, with fresh estimates, has been sent to the State. The payments will be made after approval. So far, ₹449 crore, of roughly over ₹600 crore, has been disbursed using capital funds of the GCC, anticipating that it will be recouped by the State, to ensure work flow,” he said.

On issues pertaining to roadworks, he said: “With the confidence that payment will arrive from the State, more than ₹200-crore worth of work was initiated. But no funds were released. Now, Capital funds could be used for this too.”