After the apocalyptic destruction unleashed by the 2018 floods, the Pinarayi Vijayan government projected the Rebuild Kerala Initiative (RKI) as the embodiment of Kerala's resilience.

RKI was supposed to be the dedicated agency to coordinate and implement recovery and reconstruction efforts. Its mandate was to adopt world-class ecology-sensitive technology to insulate Kerala against future disasters.

But how shoddily and carelessly such a fight back was mounted is revealed in the report of the Comptroller and Auditor General that was tabled in the Assembly on Tuesday. It was as if resilience was forgotten the moment the waters receded.

Under RKI, 29 PWD roads with a total length of 718.94 km across 13 districts were selected for reconstruction, with a sanctioned cost of ₹5119.54 crore. The CAG put the microscope on 10 of these roads.

The audit noticed deficiencies in the preparation of detailed project reports, bidding documents and several instances of deviation from contractual provisions, all of which ended up causing project delays, recurring design changes and undue benefit to contractors.

Take, for instance, how irresponsibly, and in utter violation of the contract clause, work on the Uravanchal-Maruthayi stretch in North Kerala was carried out.

Clause 3.2.1 of the Engineering Procurement and Construction (EPC) contract prohibits sub-contracting beyond 25 per cent of the contract price. Clause 3.2.2 mandates prior intimation to the Authority if any sub-contract exceeds five per cent of the contract price. Unauthorised sub-contracting constitutes ‘Contractor Default’ under Clause 23.1.1(i), and Clause 23.1.2 empowers the Authority to terminate the contract with 15 days' notice.

Audit observed that the work, which was awarded to Engineering Projects India Limited for ₹100.43 crore in October 2020, was entirely sub-contracted. After signing the contract on December 14, 2020, EPI Limited invited bids on January 5, 2021 l, and sub-contracted the work to PK Sulpheekar and Company for ₹93.67 crore. Interestingly, EPI Limited is a Mini Ratna, a Central PSU under the Ministry of Heavy Industries.

"This undermined the competitive tendering process, as the subcontractor had neither been pre-qualified nor evaluated," the CAG report said, and added: "Notably, the Authority Engineer, responsible for supervising the work and the Project Management Consultant (PMC), responsible for documenting the project, were unaware of the sub-contracting arrangement."

This violation came to light only while processing the tender for the Thalassery-Valavupara road to Thalassery Bus Terminal. By then, the work was nearly complete.

There was also an instance of a contractor falsely claiming a bonus for early project completion. Clause 19.20 of the EPC contract says that a contractor is eligible for a bonus of 0.03 per cent of the contract price for each day by which the project completion date precedes the scheduled completion date, but subject to a maximum of three per cent of the contract price. This is subject to completion of what is called a "punch list" items (works that need to be completed) within 30 days of the provisional certificate and issuance of the completion certificate.

The agreement of the Koyilandy–Eranhimavu Road work was executed in February 2021 for ₹221.07 crore with a scheduled completion date of March 17, 2023. The "punch list" included 94 rainwater harvesting systems. To be eligible for the bonus, the contractor had to complete the works by February 1, 2023.

The contractor himself informed the relevant authorities that none of the rainwater harvesting systems could be installed because of the non-availability of land at the site, as mentioned in Schedule ’ C ’.

Even then, the Project Management Consultant's drainage expert, along with the highway engineer, inspected the site on March 17, 2023, and reported that the systems were in place. The contractor secured a completion certificate and pocketed a bonus of ₹4.91 crore.

Significant irregularities were also observed in the upgradation of the Alappuzha-Changanassery Road, the AC road. The work, with a sanctioned cost of ₹114.49 crore, involved the widening of three major bridges by three meters on both sides.

The audit noticed that no detailed estimates, designs, or specifications as required by the contract provisions were provided by the contractor, and no follow-up actions were taken by Kerala State Transport Project (KSTP), the implementing agency.

The KSTP's negligence was the contractor's bounty. The undue benefit the contractor collected was nearly ₹40 crore.