Gov’t signs Specialty Hospital deal with previous bidder

-no public tendering

Government and the Indian company Fedders Lloyd yesterday signed a Memo-randum of Understanding (MoU) which will see work resuming on the construction of the controversy-ridden Specialty Hospi-tal at Turkeyen on the East Coast of Demerara.

In addition to the fact that there was no public tendering for this huge project, Fedders Lloyd had been represented during the earlier bidding process for the US$18m hospital by now Vice President and Minister of Public Secur-ity, Khemraj Ramjattan. These circumstances are expected to raise public and international concerns about the way this project has been handled, analysts say.

The signing of the MoU was also done without the media being invited despite the fact that while in opposition both APNU and the AFC which now comprise the government had complained about the absence of transparency in deals such as for the Specialty Hospital.

In a joint statement yesterday, the Ministry cited “time” as the reason why the government approach-ed Fedders Lloyd “to explore the possibility of them completing the project. Fedders Lloyd expressed continued interest and was prepared to complete and fully equip the facility.”

Minister of Finance Winston Jordan (left) and Fedders Lloyd Country Representative Ajay Jha shaking hands on the deal. (Ministry of Finance photo)
Minister of Finance Winston Jordan (left) and Fedders Lloyd Country Representative Ajay Jha shaking hands on the deal. (Ministry of Finance photo)

Fedders Lloyd had been vocally opposed to the award of the original contract to fellow Indian company Surendra. Fedders Lloyd had argued that it was better qualified than Surendra and it also challenged the fairness of the process by which the latter company was chosen.

The PPP/C government later ended up suing Surendra last year over fraud and other matters and the project stalled. After its election in May this year, the APNU+AFC government signalled that it was not interested in the project and instead wanted the remaining money to be channelled to primary health care.

The joint press release yesterday said that Fedders Lloyd in subscribing to the MOU with the Govern-ment of Guyana (GOG) will review the works already done; conclude a design of the Hospital that is acceptable to the GOG; and commit to fully equip the facility on completion of its construction. Fedders Lloyd will also undertake to begin work on the facility immediately following the signing of the MOU.

The release noted that work on the Specialty Hospital was halted after allegations of impropriety and fraud were leveled against the contractor who won the bid for its construction in 2012.

The joint statement pointed out that the then government terminated the contract and proceeded to Court to seek relief. The release noted that the Court ruled in favour of Govern-ment and the construction of the facility came to a standstill. The future of the Line of Credit (LOC) was also threatened, it said.

Following the APNU+ AFC government’s accession to office, the release said that the government reviewed the project and concluded that since there was no existing contract that could be enforced, it was impractical to continue to maintain the LOC in its existing form, especially since it was soaking up commitment fees.

The release said that the government therefore requested the EXIM Bank of India to cancel the LOC for the Specialty Hospital and to reapportion the balance of funds to a project to modernise three Primary Healthcare Facilities here.

The Government of India (GOI) in its response, while signalling its no objection and support for the Primary Healthcare Facilities suggested that the GOG should consider salvaging the Specialty Hospital, as it would complement primary healthcare facilities.

The release said that the GOG having examined the merits of the proposal began searching for a willing partner to complete the Specialty Hospital using the remainder of the LOC.

“In the interest of time, Government approached Fedders Lloyd – one of the original bidders –to explore the possibility of them completing the project. Fedders Lloyd expressed continued interest and was prepared to complete and fully equip the facility”, the release added.

At the clinching of the deal yesterday, Jordan said, “The signing of the MOU represents a tangible expression of Fedders Lloyd interest and commitment to move the project forward.”

He added that, “The MOU is also testament to Government’s commitment to advancing health care delivery in Guyana.”

He restated the Govern-ment of India’s approval of an additional LOC for the upgrade and modernizing of Suddie and Bartica hospitals and the West Demerara Regional Hospital.

Signing on behalf of Fedders Lloyd was Ajay Jha.

The release said that he thanked the GOG for the opportunity to work on the project, but more especially, to work Guyana.

He further remarked that, “The Specialty Hospi-tal will be a model not only for Guyana but the rest of the Caribbean.”