After engineering the cut of the $1.25 billion provision from the national budget for the specialty hospital, the AFC is calling for the contract for the construction to be retendered, while the government is uncertain about the project’s future.
During the consideration of the estimates by the Committee of Supply last Wednesday, the combined opposition carried an AFC motion to reduce the spending for the hospital from $1.25 billion to zero. The opposition speakers voiced concern about the money already spent on the project for site preparation and particularly the award of the contract for construction to Indian firm Surendra Engineering despite its having no experience in building such a facility.
AFC leader Khemraj Ramjattan, who at one point provided legal representation for Fedders Lloyd—one of the firms that bid for the construction contract and later complained about the award—said there should be retendering of the contract to persons who would be competent to build specialty hospitals. “And [contractor] Surendra Engineering was not competent in our view,” Ramjattan told Stabroek News. “In addition to that, the questions that we asked, proper answers were not given and that caused our decision to cut to zero,” he said.
Head of the Presidential Secretariat Dr Roger Luncheon also voiced government’s concern about the implication of the opposition’s decision on Thursday, saying it would mean the end of the project unless the decision is reversed.
“The project cannot help but being off if everything, acting on the assumption that you are saying that no intervention reverses the decision on the cut led to. So, if that is knocked out completely, if this decision is final, irrevocable, then there are obviously logical consequences,” he told reporters at a news conference.
Luncheon pointed out that Guyana has a contract with the EXIM Bank of India and with Surendra Engineering and a breach at this stage could have legal ramifications. “The Government of Guyana entered into contractual obligations based on the 2012 unanimous [budgetary] support for the specialty hospital only to be confronted with what I describe as a troubling decision, [an] incomprehensible decision by the AFC, supported by APNU, to cut the funding for the specialty hospital,” he said.
During the consideration of the estimates, Minister of Finance Dr Ashni Singh noted that $150 million was budgeted last year for site preparation, while the EXIM Bank of India provided the funding for the contract for the design, construction and equipping of the hospital.
Questions were asked about the credibility of local firm G Bovell and Sons, which won the contract for site preparation with a bid of $98 million, as well as about Surendra Engineering.
G. Bovell and Sons, which has already received $52 million in payments according to Health Minister Dr Bheri Ramsaran, was to complete land filling and preparation, building of the fence for the property, the laying of drains, installation of four bridges and gates at entrances and exits and an access road, all within three months. However, more than a year after, the contract awarded to the company was downgraded to being solely for the building of a fence.
When Stabroek News visited the site last week, not much had not changed with regard to site preparation. However, M Persaud, the contractor responsible for building the onsite office for Surendra was trying to complete his work and he stated that he was “pushing because I have to hand over to Surendra next week.”
He informed that the geo technical work he was contracted to do for Surendra Engineering was also completed and submitted and it was anticipated when the firm’s representative arrives in Guyana this week the design phase would begin.
However, works listed to be done by G Bovell and Sons remained incomplete.
APNU MP Annette Ferguson, who raised questions on the development of the site in the House, stressed that government needed to “come clean” on the contracts. She informed that when she inspected the site, much of what was claimed to be done was not. “Parts of the fence still incomplete, a whole set of sand here, there and everywhere, no drains, no roads as is specified…. Why won’t they answer the questions? It must be that that there is something to hide,” she said.
Ramsaran told the National Assembly that the firm encountered financial problems with creditors and as a result fell behind on the works it was supposed to execute on the site. He told Stabroek News on Thursday that his ministry was working with the firm to achieve contract obligations and that should not be interpreted to mean “patting him on the shoulder” but finding an amicable solution as the contractor had already received the advance from government.
He said that from very early in contract, amounts charged by G Bovell quickly raised alarms, forcing him to step in to stop what was happening, although he tries to keep an “arm’s length from contractors.”
Asked if the ministry should be held responsible for some of the blame for the laxity in works, Ramsaran adamantly said “No, not at all.”
He noted that because of these setbacks, Surendra’s work was delayed also. It has already received $746 million. “Whatever works that were outstanding from the $746 million, will have to be looked at. The documents that would have been submitted, they have to go to ministry now and we have to look at them and do certain things before we sign on to that design because once we sign on to that design it is almost written in stone,” Ramsaran said on Thursday.
Although Ramsaran felt that no amount of answers from his ministry would have stopped inevitable cuts and suggested that the opposition were against the project because it was initiated by former president Bharrat Jagdeo, the AFC maintains that the reasons for the cuts are the problems with contractors and procurement.
These problems, Ramjattan said, continue to make the case for the establishment of the long delayed Public Procurement Commission. He suggested that had the commission been established, issues such as those that surfaced with the specialty hospital would have been resolved. “We want the public procurement commission to be established because with their technical qualifications, experience and expertise, they would be a better player to ensure that that kind of contracting out to those who are incompetent and breaching and causing variations, all are going to come to a halt. It is for that reason we want the Public Procurement Commission. All that background and not wanting public security is what is causing us serious, serious hesitations in passing these things,” he said.
