Delhi LG Saxena questions ‘rising costs’ at new LNJP wing; AAP slams move

Lieutenant governor VK Saxena has flagged cost overruns at the project to set up a modern 25-floor wing for the Lok Nayak hospital in central Delhi, and has cleared a proposal to get the matter probed by the Central Vigilance Commission (CVC), officials aware of the matter said on Tuesday.

The Delhi health department assigned the project to the Public Works Department (PWD). However, the work originally tendered out for ₹465 crore is now estimated at ₹1,135 crore, the officials said.

The LG has also set up a committee headed by a retired Indian Administrative Service (IAS) officer to independently probe alleged violations that led to the overruns, and to examine all similar construction projects at other hospitals under the state health department, the officials said.

The Delhi government, meanwhile, said the cost escalation occurred at the officer level, and welcomed a probe into the matter.

Construction on the new 25-floor Lok Nayak wing — three levels below the ground, and 22 above — began in November 2020, and the project was initially expected to be completed by May 2023. However, the project is currently only around 65% complete, and has missed multiple deadlines. According to the LG secretariat, the project has also witnessed disputes with the contractor, and cost escalations of around ₹670 crore.

In an order, Saxena pointed out several procedural flaws in the project being executed by the Public Works Department (PWD) through a private contractor.

“I am astounded to learn that now the PWD has revised the preliminary estimate for project to ₹1135,55,61,904 which is two and half times the actual contract amount which was ₹465, 52,57,954 on November 11, 2022... The increase in estimate was due to certain reasons with major reason being increase in covered area of building from 88040 sqm to 95620... which appears to be unjustifiable, incomprehensible and even malafide,” he said.

HT has seen a copy of the order.

Saxena said he flagged the issues to chief minister Arvind Kejriwal in June 2023. “My communication… had also highlighted delays running into years and cost over runs running into thousands of crores in several other hospital construction projects,” the order said.

He said the cost escalation was effected at the level of engineers, and it should have instead gone to the finance department and the state cabinet. “It is beyond justification that such huge cost overruns were affected at the level of engineers of the department itself even though it should have had gone to the finance department and cabinet,” the order said.

Saxena also noted that PWD moved a cabinet note regarding the revised estimate in March this year.

The order added that the loss to the exchequer and public money due to the procedural violations and unauthorised liability is grave matter and warrants immediate investigation. “I approve the proposal to request the Central Vigilance Commission to constitute a special team of chief technical examiners to conduct a detailed technical examination in the matter,” it said.

LG secretariat officials said that a separate probe will be carried out by a committee led by retired IAS officer BK Prasad, which will submit a report in two months.

Responding to the development, Delhi minister Saurabh Bharadwaj said, “The LG’s work is to order inquiries day and night. What other work has he done for Delhi?”

However, a Delhi government spokesperson said they welcome the probe.

“In his note, the LG is himself saying that the cost escalation has happened at the level of officers without the knowledge of the government. We welcome any enquiry into this matter and strictest punishment if any illegality is found. These officers are directly under the control of the 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 Delhi government spokesperson said.