Cabinet’s intervention in awarding a US$57.6 million contract for the East Coast Demerara highway project to China Railway First Group is in violation of the extant law and has sparked outrage from the two parliamentary opposition groups.
Stabroek News reported in yesterday’s edition that the government sidelined a proposal made by the National Procurement and Tender Administration Board (NPTAB) and gave instructions for an award and subsequent no-objection to the firm based upon lobbying by a former senior member of government.
The government was yesterday silent on the report in Stabroek News. Observers say that the Cabinet intervention is the starkest manifestation yet of the irregular dealings that the PPP/C government has engaged in over procurement. In this particular case sources say it was meant to favour China Railway First Group Co. Ltd as the government wants to keep the company engaged for the purposes of the Amaila Falls Hydropower Project on which it was supposed to be the contractor. That project stalled after the US investor walked away and China Railway could also disengage entirely if there wasn’t a reason to keep it here.
“Is who else but (former President) Bharrat Jagdeo give this order…this is a clear violation of the law…our constitution had for the establishment of a PPC (Public Procurement Commission) and so these things like this award could not have happened. It’s reasons like this we need the PPC swiftly,” Joe Harmon said on behalf of his coalition, A Partnership for National Unity(APNU).
His views were echoed by the Alliance for Change leader Khemraj Ramjattan.
“This kind of cabinet decision making is the reason why the PPC must come into being. That Jagdeo relationship with all these major Chinese companies is clearly one that is not above board,” Ramjattan stressed.
The source explained that four companies submitted bids for the project but three of them had incomplete documents, while the other went over the estimate. As a result, the NPTAB made proposals and was told that the matter would be taken care of. It later learnt that China Railway First Group would be awarded.
On May 13, this year, four Chinese construction companies placed bids for the Ministry of Public Works project, which entails work from Better Hope to Belfield Village
Two of the firms have been doing business with Guyana. China Harbour Engineering Co Ltd (CHEC) is the contractor of the US$150 million expansion to the Cheddi Jagan International Airport (CJIA), Timehri and China Railway First Group Company Limited was the contractor for the Amaila Falls Hydroelectric Project.
The project will be one of the costliest in recent times in terms of infrastructural works, after the ongoing CJIA expansion and Marriott Hotel construction.
The source explained that during the evaluation of the bids, it was recognized that three companies, CSCEC, CNMIE, and CRFG, had incomplete bids; that is, there were errors in documentation. The other company, CHEC met all the requirements but was US$2 million over the engineer’s estimate.
Given the details of all the bids, the NPTAB’s evaluation committee said that the bid should have been retendered. However because of a number of factors, the board made a recommendation to the Ministry of Public Works.
The source said recommendations for options that could be explored included that the bid be awarded to the company with all its documentation in order which was CHEC. It was also suggested that although the bid was higher than the estimate, the Ministry of Public Works negotiate with that company for a reduction.
However, the source said that at a meeting of Cabinet, the former senior member led a defence for China Railway First Group and recommended that company for the project. That company was subsequently told of the award and an announcement is to be made soon.
According to Section 54 of the Public Procurement Act, Cabinet cannot award a tender. The
Cabinet has a right to review all procurements in excess of $15 million based on a streamlined tender evaluation report.
Cabinet may only object to the award of a contract if the procuring entity has failed to comply with the applicable procurement procedures. It has 21 days to do so. If Cabinet objects to an award, the matter is referred to the procuring entity for further review.
The AFC leader said that cabinet’s interference shows the favouritism of the PPP/C government to some companies and the laws they will circumvent to ensure those companies are given rewards in the form of contracts.
Ramjattan said that he believes that government prefers to take loans and do business with the Chinese because they are done in strict secrecy. “…This PPP/C loves to deal with China and Chinese because, one, there is no internal security of these countries. I am absolutely certain is the secrecy they like,” he said.
“When international companies misbehave there are international prohibition laws … China does not have that law that is why this government love to go to the Chinese they don’t ever want to ask other international countries,” he added.
APNU says it believes that government wants to maintain a role in the operations of the NPTAB so that it has a say in the award of contracts.
“This is why this government wants to maintain that even after NPTAB has deliberated on these contractors they have a say because once they are politically connected they can now be awarded a major contract such as in this case on the East Coast,” Harmon said.
“We are not happy with this development and this is similar to them having a say in the supply of pharmaceuticals and other major contracts of that nature …we have warned about this recklessness they are disregarding the laws and just behaving like there is no accountability for their actions. Guya-nese have to voice their concerns .These are signs of a dictatorship in the making and we have to speak up now,” he further said.