Surendra was still to complete pumps supply after 30 months – auditor general report

-pump shafts weren’t supplied for three, spares not shipped

Up to September 2014, 30 months after a US$4m contract had been signed with the government, the Indian company Surendra was still to complete the supply of eight fixed pumps, according to the 2013 report of the Office of the Auditor General (OAG).

The controversial Indian firm was last year September fired by the PPP/C government from the specialty hospital project for alleged fraud. Numerous questions had been raised about the supply of the drainage pumps and why the India-funded project was awarded to it in the first place. Given the lawsuit over the specialty hospital contract, it is unclear what the status of the pump supply project is. The Ministry of Agriculture under the previous PPP/C government had provided disjointed information on the project.

In its report recently tabled in the National Assembly, the OAG without naming Surendra noted that on July 26th , 2010, the Government of Guyana and the Export-Import Bank of India had signed a credit agreement in the sum of US$4M for the acquisition, installing and commissioning of six mobile and eight fixed pumps. However, up to September, 2014, the report said that while seven of the eight fixed pumps were received only four were complete whilst the other three had no pump shafts. The other pump had been reportedly dispatched to Miami, USA to facilitate factory testing.

The OAG report said that the four complete pumps were set up at Manarabisi, Skeldon; Windsor Forest, West Demerara; Bagotville, West Bank Demerara and Paradise, East Coast Demerara. It added that the three incomplete pumps were kept at a warehouse owned and managed by the pump manufacturer’s agent in Guyana. Up to the end of September 2014, a sum of US$126,000 was paid for pump spares but these hadn’t been supplied up to the point of reporting.

The housing for one of Surendra's pumps at Rose Hall
The housing for one of Surendra’s pumps at Rose Hall

At the time of reporting, September 2014, the OAG said that US$2.991m of the US$4m contract had been paid to the contractor. It is unclear whether since the end of September last year there were further payments to Surendra though this would have appeared unlikely as the government had then taken it to court over the specialty hospital project.

The OAG report said that six mobile pumps were received under the contract and these were placed at Lusignan, East Coast Demerara; Pine Ground, Mahaicony; Rose Hall, East Berbice; Mibicuri, Black Bush Polder; Three Friends Village, Essequibo Coast and Lima Village, Essequibo Coast.

Based on the payment schedule in the OAG report, as of September 2014, US$1,008,853 was still outstanding on the project. Of this amount, US$949,853 pertained to the supply of the eight fixed pumps, US$33,000 for technical support and US$18,000 for pump spares, design and engineering costs.

The OAG said that the ministry’s response to its findings on the pump supply project was that the remaining pump shafts and the remaining complete pump had all been factory tested and approved. The ministry further said that dispatch clearance for the shipment had been granted and that it was due to arrive shortly. It further explained that the incomplete pumps were stored at the warehouse of the manufacturer’s agent as the National Drainage and Irrigation Authority’s Stores did not have the lifting capacity to load and unload the pumps.

The recommendation of the audit office was that the Ministry of Agriculture takes steps to have all outstanding items delivered by the supplier.

The OAG report said that after the signing of the credit agreement on July 26, 2010 with the EXIM Bank of India, the National Procurement and Tender Administration Board gave approval on February 15, 2011 for 28 suppliers to be shortlisted for the contract. Seventeen expressed interest but only two tendered. The OAG said that the contract was awarded to the “more responsive of the two bidders”.

 

 

 

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