In a step to enhance transparency, accountability, and quality control across public infrastructure projects and their development, the Delhi government’s Public Works Department, led by minister Parvesh Verma, has introduced a stringent new measure to tackle the issue of non-serious and speculative bidding in departmental tenders.
As it has been observed during the past several months, there has been a concerning trend where certain bidders, primarily focused on allegedly just acquiring tenders, rather than executing them efficiently, quote abnormally low rates—often well below the department’s estimated project costs.
While such bids appear competitive on paper, they frequently result in project delays, sub-standard work, or in some cases, complete abandonment of the project midway.
Such things not only hampers infrastructure growth, but also causes inconveniences to the public and burdens the exchequer with escalated costs, the minister has said.
To curb this practice and instill a greater sense of responsibility among bidders, Verma has announced the implementation of an “Additional Performance Guarantee” clause for all future tenders where bids are found to be abnormally low.
Key features of the fresh guideline include ‘Additional Performance Guarantee,’ according to which, In those tenders where the lowest quoted bid falls more than a specified percentage below the estimated cost, it will be treated as unworkable.
The concerned bidder will be required to submit an ‘Additional Performance Guarantee’ equivalent to the difference between the quoted rate and the threshold percentage, and this guarantee will be over and above the existing security deposit and performance guarantee requirements.
Work will be awarded to such lowest bidders only after the submission of the APG.
The primary goal is to eliminate speculative bidding, ensure only capable and serious contractors participate, and improve overall efficiency and quality of public works.
Verma stated, “This decision is not just about financial safeguards—it’s about accountability and respect for public funds. When a contractor quotes an unreasonably low amount and then fails to deliver, it’s the common man who suffers due to project delays and poor infrastructure.”
“We are committed to building a transparent and efficient PWD that puts the citizens first, ” Vema added.
By ensuring that bidders have the financial and technical capacity to undertake projects at quoted rates, the department seeks to raise the bar on execution standards.
For this transition, training sessions will also be organized to brief engineers and tender evaluation committees on how to implement the new system effectively.
This initiative is part of a larger roadmap being undertaken by the department under Verma’s leadership, to streamline internal processes, and uphold the highest standards in infrastructure development.