Issue of engaging agencies with poor track record

During an informal conversation over chai last week some colleagues made not very kind remarks about the manner in which administration in my university had lately been handling the campus development project. My colleagues were apprehensive about the abilities of a particular architect firm who along with all its allied firms/subsidiaries had been black-listed by AAI for non-performance. This presumably non-performer architect firm has been hired by our administration. Also was in doubt the abilities of CPWD to deliver on this project of "national importance". Reputation of CPWD has not been that good on delivering projects. It is not uncommon to hear about contractor firms who simply refuse to take up work when they learn that it is handled by CPWD.

Role of PMC is very crucial to such mega projects: onus of ensuring that the contractor builds a good quality infrastructure that meets the client's requirements lies mainly on the PMC. When client administration selects a PMC they are expected to hold goals and interests of the organization above anything else. Normally, administrators in client organization have full liberty about how to form the PMC. They may engage a private firm such as Tata, McKinsey etc., constitute their own team of professionals or engage with Govt. agencies such as CPWD, NBCC etc.

Often the academic administrators see a downside to engaging with private firms or individual consultants for PMC: it puts most of the responsibility of ensuring financial and physical quality compliance on the client administration. Whereas engaging with a Govt. agency such as CPWD, NBCC etc. transfers the client's risk of getting embroiled in corruption charges and series of investigations to CPWD/NBCC etc. In other words, if any wrongdoing in the project execution is reported to a Govt. watchdog, then the investigators (e.g. vigilance bureau, CBI etc.) will raid CPWD/NBCC officers and not the client administrators, if the PMC happens to be CPWD/NBCC.
Some "experts" argue that though with a private PMC the odds of delivering a project on time and with quality are higher, their fees are very high. Client administrators often go by this argument when defending their choice of an arguably less efficient Govt. PMC. They somehow choose to ignore the past track record of these Govt. PMCs where the cost and time overruns, and quality departures in projects executed by them far exceeded the price of hiring an alternative PMC. Though I am not a professional who deals with legal technicalities of contracts management, I would like to suppose that there ought to be a way to craft a suitable contract with an alternative PMC firm which provides a similar "risk transfer" to the client as in case of CPWD/NBCC.

All said and done we remain answerable to the taxpayer, whose money is spent on such mega projects. I think it will be in our interest to carry out a study which objectively compares projects delivered by private PMCs and those by Govt. PMCs on parameters such as: time and cost overruns, quality of delivered artifacts, financial or other kind of irregularities reported etc.


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