Considering the depth and age of the debate for best procurement practices and good governance, it is appalling that the government has embarked on a Memorandum of Understanding for what could be a US$30M waste recycling plant in such a flawed manner. Nothing about the MoU with the Canadian-Guyanese, Mr Mohammed Osman reads right. The only good news is that no deal has yet been consummated and given everything that has since been learnt, the whole thing should be abrogated and the process resumed afresh.
First, the government has a major comprehension problem. By its own agreement its involvement in anything procurement was to be completely phased out by now had the Public Procurement Commission been in place. However, it is now ill-advisedly going to Parliament with an amendment to the Procurement Act to allow it to retain its no-objection to contracts. What is even worse in this case is that it wasn’t only the question of a no-objection the government was seeking. It seems that the government wanted complete control of the process. There was no recourse to the National Procurement and Tender Administra-tion Board (NPTAB) and that will immediately raise concerns that there is something that the government wants to hide and protect about this MoU.
The glibness with which the Local Government Ministry addressed the matter of the exclusion of the NPTAB at the signing is disconcerting. At the signing of the MoU on November 11, 2013, the Permanent Secretary in the ministry, Mr Colin Croal said that a number of expressions of interest were received from nine companies. “Cabinet took a decision to assign the Ministry of Local Government the responsibility for reviewing these expressions,” he said.
He further revealed that the companies were asked to submit detailed proposals and were subsequently ranked based on this and additional information provided.
“The ministry assembled a team which we call, ‘the solid waste team’, which recommended the top ranked company …We subsequently received no objection from cabinet to this number one company”, he said rather nonchalantly.
So not only was Cabinet prepared to exercise its no objection but it arrogated to a ministry the responsibility to run the show. There are of course no records of the deliberations by the ministry to assuage any aggrieved bidder and furthermore no process by which the public can ask to be privy to how the selection was made.
Things continued to go downhill after that. Mr Croal would later say that over a period of time a number of firms had sent in proposals and expressions of interest for building and operating waste recycling facilities. He added that these expressions of interest went to the Office of the President and the Ministry of Natural Resources and the Environment.
After considering the expressions of interest, Mr Croal said that his ministry compiled them and made a presentation to Cabinet following an evaluation which determined that Mr Osman’s Natural Globe had the best proposal. He said too that Cabinet then gave the go ahead for the inking of an MOU with the company.
According to Mr Croal, an evaluation of this company was followed by a due diligence and it was determined that the company was fit and proper to engage with Government on the setting up of the facility.
A due diligence would have had to be done in accord with the standard required when determining if an investor is fit and proper. What type of due diligence was done boggles the mind. It took questions from Stabroek News to Mr Osman to establish that he had never built a commercial waste recycling plant. The closest he had come to this was a prototype. Under normal circumstances Mr Osman’s application would then have been sent to the bottom of the lot and the other applicants considered. It would appear that the voluble public ferment over whether Mr Fip Motilall had credentials for road building in virgin forest has been completely lost on the government.
Solid waste recycling is a serious issue in this country. With a price tag of US$30M it cannot be possible that this task can be assigned to someone who has not commercialized his ideas and plans before. Indeed, it appears that there were other applicants with varied ranges of experience. Were they carefully considered and called in for clarifications? It is important that the Local Government Ministry committee makes available to the public the basis for this decision.
Curiously, on November 14, the ministry attempted to defend the selection of the company by arguing that there was no financial cost to the public from the Natural Globe proposal and that it coincided with Guyana’s sustainability programme.
In a statement, the ministry said that the selection criteria were based on the proposed nature of the recycling programme and its relevance to Guyana’s context of development and sustainability. “In addition, the proposals submitted by the other potential agencies had significant monetary impact and other obligations on the State in order to make their proposed programme a success,” it said. “Natural Globe Guyana Inc. on the other hand, proposed a method of operation that did not contain any monetary impact on the State hence, the direction the GoG is hoping to move forward with,” it said.
There is no argument with it coinciding with Guyana’s plan but the assertion that it was selected as there was no financial attachment to the state is ludicrous. Nothing comes free these days and such promise no matter the sector or scale must be treated with much circumspection. Without any reference to the type of technology to be applied and its success elsewhere, the government is prepared to sign off on a US$30M deal with an investor who can provide nothing on his track record. It is truly outrageous and exposes the arcane processes in the inner sanctums of the government.
Further questions have been raised about the financial capability of the company and the fact that it hasn’t lined up land for this venture as yet. That the daughter of a senior government official is a director of the company would point, at least, in the direction of the architects of this deal trying to ensure that it was something that the government would not refuse.
The government has had a long list of regretted deals and arrangements over the years because of poor due diligence and sweetheart accommodations. It must guard against that happening again and recommit this process to a fresh start under the NPTAB.
