CAG puts undue benefit to contractors in Rebuild Kerala roadworks at Rs 67.49 crore

13 October 2026

A Comptroller and Auditor General report on roadworks under the Rebuild Kerala Initiative found deficiencies in project planning, deviations from contractual provisions and irregular payment arrangements that gave contractors undue financial benefit and added to the State's financial burden.
Under the initiative, 29 roads spanning 718.94 km across 13 districts were selected for reconstruction during 2019-20 and 2020-21 at a sanctioned cost of Rs 5,119.54 crore.
The CAG examined 10 of the 29 roadworks, implemented by the Kerala State Transport Project, as part of its compliance audit.
On the Alappuzha-Changanassery road the audit identified an undue benefit of Rs 39.27 crore to the contractor after deviations in the procedure for approving changes to bridge-widening works.
A further Rs 28.22 crore of undue benefit was attributed to the splitting of payment stages for earthwork and ground-improvement works, which in some cases allowed payments between 333 and 911 days ahead of the scheduled completion of the stage.
The Uruvachal-Maruthayi road contract, awarded for Rs 100.43 crore in October 2020, was entirely subcontracted for Rs 93.67 crore in August 2021, contrary to the agreement conditions.
The audit observed that this undermined the tendering process, which required bids to be considered only from contractors who had qualified through technical evaluation.