10:02 August 17, 2012
I wonder if the scenario is any different in other places in Mumbai but I can state for a fact that it’s certainly true about the area and the building where I live. Our garbage is not collected for days. Worse, the garbage piles up very strategically near the bus stop where a bunch of parents go to drop their kids to the school bus. I reckon the kids are getting a lesson from the text book on ‘keeping the surroundings clean’. Earlier, the garbage used to get collected once in 2-3 days; my guess is that it now gets collected perhaps once in 7 days. Obviously, this raises a stink both literally and physically and like all responsible citizens of the state, the standard reaction is to go shouting at the society manager as if he has solution for all the problems.
I am no different and approached the relevant people and politely enquired the reason why garbage was not getting cleared. The society manager’s inputs were extremely enlightening to say the least. He gave me a quick update and cited how he proactively went and met not only to the BMC contractor but also to the local MNS, Shiv Sena, Congress and other political parties who could play a role in local civic hygiene and maintenance.
His feedback was that the contractor who bagged the contract for collecting the garbage is not interested in the job simply because there is no financial incentive left for him. The acquisition cost of getting the contract is very high and that leaves no margin left in clearing the garbage. Manpower and other operating costs have risen and that has eroded whatever balance that was left on the table post acquisition costs. My guess is it’s the same story with other infrastructure projects too. The Times of India in the recent past is carrying breaking news of the escalations in projects in Maharashtra and that tells the story of how the system works. However noble the intentions of the contractor may be, after getting the contract and given the price escalation, he soon realizes that it is better not to do the project. The other alternative is to pay more money to the powers there are and push for escalation cost recovery.
The reality is that people bid at outrageous prices after factoring in acquisition costs thinking a) they will get the project and that will improve their market capitalization leading to a virtuous cycle of raising more equity, etc; b) they will get compensated for cost escalation. Thanks to voices from the likes of Anna Hazare, Baba Ramdev and others, the powers there are not able to take any decision regarding cost escalation. A bear market and falling stock prices of infrastructure stocks has rendered capital raising also unviable so the infrastructure projects are caught between the devil and the deep blue sea.
The recent remarks of Uttar Pradesh PWD Minister Shivpal Singh Yadav have to be interpreted in this context. It seems he had told bureaucrats to "steal but don't loot" and "if you work hard, your act of stealing can be acceptable, but don't commit a dacoity." The words of the minister are not really something to worry about much but a mere statement of the harsh reality facing the country.
I actually believe that Ministerji wants to rein in corruption and not increase corruption. Corruption has now reached a level where people are taking money and not doing anything. All he ordered was take some money and do some work also instead of committing ‘dacoity’ like other regimes. Instead of castigating him and giving him a bad name, we should appreciate the fact that he has identified the problem correctly. He is perhaps suggesting a middle way out whereby demands are kept reasonable so that they can ‘eat’ something and do some work also which will enable them to get re-elected.