CAG report hits out at delays, cost escalation in Kochi Corporation headquarters project

The new headquarters of the Kochi Corporation was inaugurated in October 2025 at almost three times the original cost, with some work still unfinished. | Photo credit: THULASI KAKKAT

Continued delays in the construction of Kochi Corporation’s new headquarters on Marine Drive, along with accompanying cost escalation, have drawn sharp criticism in the Comptroller and Auditor General’s report on local bodies for the period 2020-21 to 2022-23.

Incidentally, the building remained unfinished during the period covered by the report. It was finally inaugurated on 21 October 2025, towards the end of the previous Left Democratic Front council, at an increased cost of around ₹61 million. However, further work is still pending.

The report said the contract for the new building was awarded at a cost of ₹18.83 crore, with a stipulated completion time of 20 months. Administrative sanction was granted in July 2006. Although work had started, the contractor stopped construction in April 2008 after several deviations from the approved estimate by established companies, leading to disputes.

₹ 6.10 crore was paid to the contractor during this period. While the Corporation Board decided to terminate the contract at the contractor’s risk and expense, the Kerala High Court, acting on a petition filed by the contractor, decided otherwise. Subsequently, the work was re-awarded to the same contractor in May 2015 with a revised estimate of ₹ 18.70 crore for the remaining work, the report said.

Further variations and additions led to another revision in July 2018, increasing the estimate to ₹24.71 crore. As of December 2024, despite spending ₹25.70 million, the building remained incomplete. During a joint physical verification that month, audit officials found waterlogging of up to 1.5 feet in the basement, even though the contractor had been instructed a year earlier to fix the seepage problems. However, there was no correction.

“The audit found that frequent revisions of estimates, slow pace of work, insufficient own resources, etc., led to cost overruns and the project not being completed even after 17 years. The government said in November 2024 that the building was in the final stages of construction and would be completed in January 2025. However, the government did not offer any specific comments on the report about the construction not being completed after 17 years,” he said. he said.

Published – 8 Jul 2026 22:38 IST