Dear Editor,
Minister of State Joseph Harmon in his recent post cabinet press briefing to the media which was reported in SN on Sept 24, stated that some contractors were deliberately under-bidding government projects to win contracts only to return later with lame excuses to justify the need for contract cost increases, thereby causing bona fide contractors to be cheated out of government contracts.
It is unfortunate that this statement belies the facts as contract costs increases are due to many complex factors outside the dictates of the contractor.
Experienced contractors before bidding, review contract documents in great detail and are quick to recognize omissions in the bill of quantities as well as changes which have to be made to the plans and specifications during construction if the project is to fulfil its design requirements. Therefore they low bid on listed items of work and jack up the costs for variations (change orders) which enables them at the end of their contract when the pluses and minuses are tallied, to generate a profit. These variations which are necessary for project completion have to be negotiated and approved by the government before payments are made to the contractor.
The Kato Primary School (KPS) in Region 8 was awarded for construction to the lowest bidder (not the lowest evaluated bidder) at a cost of $780M in April 2013 with a completion date of April 2015. The engineer’s estimate for the project was $680M. As of September 2015 construction costs had increased to over $1.0B and are still rising. Construc-tion time overrun is over five months with no specific project completion date.
It was noted that the KPS project cost increases and contract time extensions were recommended in the first instance by the government’s consultant for supervision of project works, and then submitted for approval by the government officer overseeing construction of the project for the responsible ministry. If there was no collusion between these government employees, then Minis-ter Harmon should have been aware that the payments made for extra work and the additional time given to the contractor for the KPS project were legitimate and had nothing to do with under-bidding and shady contractors’ tactics as was claimed.
Experience has shown that if a project is poorly designed and its contract documents ill prepared there will be many variations during construction resulting in a project cost increase.
The contractor is entitled to be paid extra for all works above and beyond those listed in his bill of quantities for which he tendered and for any time extension due to construction delay caused by the government. It is inconceivable therefore that the consultant for construction services did not alert the APNU+AFC government in his periodic reports which must have been submitted during the past five months that this KPS project was incurring large costs and time overruns. Neither were accompanying recommendations given for remedial action which should have been taken to slow and/or eliminate their increases. Despite these and other supervisory lapses the APNU+AFC government has given this consultant a contract time extension and will be paying a further $4.2M for his services while project costs continue to escalate with no completion date in sight.
It is evident that the Ministry of Education under its existing organization lacks the competency to design, prepare tender documents and supervise the construction of schools.
Therefore, Minister of Education, Dr Rupert Roopnaraine should seriously consider re-organizing this ministry and establish a School Construction Division staffed with qualified personnel to provide architectural and engineering services to design and build schools as well as the other educational facilities under his portfolio to generally accepted standards and with the division directly answerable to him for its performance.
Yours faithfully,
Charles Sohan
