MADURAI: Milk delivery contractors and dealers have alleged that Aavin (Madurai) has been offering contracts to some delivery vehicles, outside the tender process, at rates of rent hiked by as much as 20%-57% causing huge losses for the state government cooperative over the past two years.
According to Tamil Nadu Milk Dealers' Welfare Association President S A Ponnusamy, the delivery vehicles hired from 29 contractors distribute Aavin milk packets to agents, restaurants, government hospitals and institutions through 70 distribution routes in Madurai district.
A rental vehicle contract is drawn out for 39 delivery routes annually, and another contract for the remaining 31 routes every two years. The contract has to be renewed with a maximum rent hike of 10%, taking into account expenses like fuel and wages of employees. A total of 78 applications for urban milk distribution routes and four for suburban routes were received when the technical bidding was opened online in August 2023.
"During the negotiation talks held with contractors on August 18, 2023, an agreement was reached only with the delivery vehicle contractors for nine routes. On September 29 that year, Madurai Aavin decided to refuse contract approval for 25 routes citing that the rent quoted was higher than that of the previous year.
Hence, rental agreements were chalked out only for nine routes. But, instead of seeking new contracts, the Tender Committee of Aavin (Madurai) re-negotiated with the contractors concerned for a third time in violation of the tender's code of conduct. The contracts were subsequently recommended for them at rates of rent increased by as much as 20%-57%," he said.
K Chelladurai, one of the contractors, said, "This issue has clearly caused a huge loss for Aavin (Madurai). Throughout the country, no contractor is allowed to increase the cost of service by over 10%. Besides, it is unfair to contractors who are working at just a 10% hike."
When contacted, an official from Aavin (Madurai) said, "Based on approval from higher officials, we renegotiated with the contractors, as milk distribution is an essential service for the public and any delay in distribution would harm the reputation of the existing contractors. Anyway, we have initiated an inquiry on the issue."