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Telangana govt to scrap EPC system
The Telangana government has decided to do away with the Engineering, Procurement, Construction (EPC) system that was in vogue so far with regard to construction of various projects. EPC is a prominent form of contracting agreement in the construction industry. The engineering and construction contractor will carry out the detailed engineering design of the project, procure all the equipment and materials necessary,
The government has decided to revert to the old system of Commissionerate of Tenders due to alleged irregularities in construction works
Hyderabad: The Telangana government has decided to do away with the Engineering, Procurement, Construction (EPC) system that was in vogue so far with regard to construction of various projects. EPC is a prominent form of contracting agreement in the construction industry. The engineering and construction contractor will carry out the detailed engineering design of the project, procure all the equipment and materials necessary, and then construct to deliver a functioning facility or asset to their clients.
Companies that deliver EPC projects are commonly referred to as EPC contractors. The Cabinet subcommittee consisting of Ministers Tummala Nageshwara Rao, T Harish Rao and K Taraka Rama Rao has recommended to the Chief Minister to do away with the EPC system and revert back to the system of calling tenders and adopt COT (Commissionerate of Tenders) method.
The subcommittee favoured COT as in the last decade there had been several allegations about misuse of EPC system especially during the ‘Jalayagnam’ scheme taken up during the Congress regime led by Y S Rajasekhara Reddy. Also, some loopholes in this format led to an inordinate delay in construction works in some cases, the subcommittee felt. There were allegations that contractors had taken huge amounts of money as mobilisation advance and indulged in several irregularities.
The Ministers were of the opinion that changed conditions and increased unit costs should be taken into consideration while finalising new guidelines. It may be mentioned here that Commissionerate of Tenders was constituted in June 1987 to overcome several deficiencies in tender accepting procedures and to ensure all-round perception of objectivity and impartiality in the process of finalisation and acceptance of tenders. However, the Congress government preferred EPC system, but TRS government decided to revert to the old procedure.
