The financial stress that the Coimbatore Corporation seems to be undergoing, it appears, continues as it has defaulted on payment to Suez India Pvt. Ltd., the company engaged in maintaining water supply in the old city areas.
Sources said the Corporation had paid only ₹ 1 crore to the company since it started looking after the maintenance of water supply in the old city areas – 60 of 100 wards – in February 2019.
The Corporation, as per the agreement signed with the company, ought to have paid at least ₹ 4 crore a month.
The pending payment was only for the maintenance of water supply in the old city areas. The money the Corporation had to pay to the company for the execution of the 24×7 drinking water project – replacement of old water supply lines with new ones and installation of smart meters – was different from this. And, for the works the company had executed this far, the Corporation had paid only a meagre amount and owed at least two instalments.
The impact of the Corporation defaulting on payments of over ₹ 20 crore was the company found it difficult to pay its engineers, turncocks, workers and contractors it had deployed for water supply maintenance, the sources said and added that there were at least 300 persons engaged in the maintenance work.
The company had taken over the maintenance of water supply in January 2019, thereby allowing the Corporation to redeploy its turncocks to added areas for looking after water distribution in those 40 wards.
Asked about the pending payment, a senior Corporation officer said on condition of anonymity that he would have to look into the files to know the reason for the delay. The Corporation had signed the 24×7 water supply agreement with Suez India Pvt. Ltd. for ₹ 2,972.16 crore to revamp water distribution in the old city areas. It had mandated the company to complete the revamping work in five years and look after maintenance for 20-plus years.