Lok Sabha Question No. 2891 (UNSTARRED), answered on 2018-12-28
Subject: Cost and Time overruns in Construction of New AIIMS
Ministry: HEALTH AND FAMILY WELFARE
Asked by: SUPRIYA SADANAND SULE, RAJEEV SHANKARRAO SATAV, DHANANJAY BHIMRAO MAHADIK, P.R. SUNDARAM, JAYAKUMAR JAYAVARDHAN, HEENA VIJAYKUMAR GAVIT, VIJAYSINH MOHITE PATIL

## GOVERNMENT OF INDIA MINISTRY OF HEALTH AND FAMILY WELFARE DEPARTMENT OF HEALTH AND FAMILY WELFARE

## LOK SABHA UNSTARRED QUESTION NO. 2891 TO BE ANSWERED ON 28 TH DECEMBER, 2018

## COST AND TIME OVERRU NS IN CONSTRUCTION OF NEW AIIMS

## 2891. SHRIMATI SUPRIYA SULE:

SHRI SATAV RAJEEV:

SHRI DHANANJAY MAHADIK:

SHRI P.R. SUNDARAM:

DR. J. JAYAVARDHAN:

DR. HEENA VIJAYKUMAR GAVIT:

SHRI MOHITE PATIL VIJAYSINH SHANKARRAO:

Will the Minister of HEALTH AND FAMILY WELFARE be pleased to state:

- (a) whether the cost of construction of six new AIIMS has escalated by Rs. 2,928 crore, if so, the project - wise details thereof and the reasons therefor;
- (b) whether there is time overrun in completing the six new AIIMS, if so, the insti tution - wise details thereof a nd reasons therefor;
- (c) whether the Government has conducted any assessment regarding co struction of new AIIMS in the last four years, if so, the details thereof and if not, the reasons therefor; and
- (d)  the  details  of  the  steps  taken/being taken  by  th e  Government  to  reduce  time and  cost overruns of such projects in the country since 2014, year, State and project wise?

## ANSWER THE MINISTER OF STATE IN THE MINISTRY OF HEALTH AND FAMILY WELFARE

(SHRI ASHWINI KUMAR CHOUBEY)

- (a) : As per initial Cabinet Committee on Economic Affairs (CCEA) approval in March, 2006 the construction cost for six AIIMS was estimated as Rs. 1,992.00 cr. However, was revised by CCEA to Rs. 4,920.00 cr on February, 2010 resulting in escalation of estimation by Rs. 2,928 cr. The reasons cited for this cost escalation in CCEA note 20 project wise details is given in Annexure.
- (b) : There has been time overrun in the implementation of the Project, due to follo factors  like  non -availability of  land  at  appropriate  time, failure  on  part  of  Design  DPR Consultants, Project Consultants, construction agencies and delay in finalization of cost estimates, inadequate bid responses in some cases etc.

However at present all the six AIIMS are functional with all Specialities and ma of the Super Specialities.

- (c) : The  Ministry  has  been monitoringthe  progress  of  construction  at  six  AIIMS periodically  through monthly reports, progress meetings a t senior level, online monitoring through dashboard etc.
- (d): Following  steps  have  been  taken  by  the  Union  Government  to  ensure  proper implementation of PMSSY :
- I. The system of assigning the construction work to executing agencies on turnkey b with empowerment to handle all   contractual matters at their end has been introd
- II. The  functional  AIIMS  have  been  empowered  with  greater  delegation  of  powers  in construction, procurement and administrative matters.
- III. The procedure for procure ment of medical equipment has been simplified and made more efficient with greater delegation and empowerment of the Procurement Suppor Agency (PSA).
- IV. Several measures have also been taken to improve the faculty availability at Nat level.
- V. An online dash board has been created to facilitate closer monitoring of the pr of all PMSSY projects.

## FACTORS RESPONSIBLE FOR INCREASE IN COST OF SIX AIIMS

As  per  the  Revised  Cost  Estimates  (RCE)  approved  by  CCEA  in  2010  the  reasons  for  cost escalation provided for is tabulated below :

| Sl.   | Items considered for cost escalation                                                                     | Justification for escalation                                                                                                                                                                                                                                         |
|-------|----------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (i)   | Increase in cost index cost approved by EFC in 2004                                                      | over Increase in cost index resulted in an additional approximately Rs. 70 cr                                                                                                                                                                                        |
| (ii)  | Change of Scope                                                                                          | Increase in bed strength from 850 to 960 and area per bed from 60 - 65 sq.m . to 100 sq. m. resulting in an financial implication of approximately Rs. 175 cr                                                                                                        |
| (iii) | Adoption of best practices in green building and compliance of Energy Conservation Building Codes (ECBC) | concept Additional financial implication is approxi mately Rs. 45 However this will be offset within 3 - 4 years by energy savings 15- 20% per annum                                                                                                                 |
| (iv)  | Addition of items envisaged in earlier EFC                                                               | not Additional impact on inclusion of additional items not envisaged in the earlier EFC is approximately Rs.                                                                                                                                                         |
| (v)   | Work Contract Tax                                                                                        | Work contract Tax was not considered in the proposal. At 4%, the financial implications will be proximately Rs. 23 cr per site                                                                                                                                       |
| (vi)  | Upgradation of medical equipments                                                                        | As per EFC / CCEA, the cost of medical equipments 104.50 cr. Subsequently medical experts of AIIMS, New PGIMER (Chandigarh) worked out minimum requirement medicalequipments including other service equipments, for each institution, cost of which is estimated at |
| (vii) | Contingencies @3%                                                                                        | Due to the cost impact on the above aspects expenses will increase by approximately Rs. 9 cr.                                                                                                                                                                        |

## REVISED COST APPROXIMATION IN CABINET NOTE AS ON 2010

| Sl.   | Description   | Total Area Revised (sq.m)   |   Residence & Hostel (Rs. cr) |   Hospital & College (Rs. cr) |   Cost of Medical Equipment (Rs. cr) |   Total Cost (Rs. cr) |
|-------|---------------|-----------------------------|-------------------------------|-------------------------------|--------------------------------------|-----------------------|
| 1     | Bhopal        | 175052                      |                       110.342 |                        507.28 |                                  200 |                817.7  |
| 2     | Bhubaneswar   | 191457                      |                       103.05  |                        497.44 |                                  200 |                800.49 |
| 3     | Jodhpur       | 167188                      |                        67.7   |                        488.88 |                                  200 |                756.58 |
| 4     | Patna         | 179839                      |                       125.28  |                        513.15 |                                  200 |                838.43 |
| 5     | Raipur        | 184219                      |                       111.58  |                        458.9  |                                  200 |                770.48 |
| 6     | Rishikesh     | 178737                      |                       103.05  |                        480.1  |                                  200 |                783.15 |
|       |               |                             |                       621.002 |                       2945.75 |                                 1200 |               4766.83 |