Company still to supply bulldozer to Region Six administration, PAC hears

-Auditor General’s investigation uncovers discrepancies in purchase

K&P Project Management, the company that supplied the wrong bulldozer to the Region Six administration in January, has once again been delinquent in its commitment to supply the correct item, with a June 13th deadline having passed.

Members of the National Assembly’s Public Accounts Committee (PAC) yesterday heard that in spite of the region having the commitment of the contractor, following both meetings and written correspondence, K&P has failed to deliver the item by the agreed time.

In addition, at a PAC hearing yesterday it was revealed that a special investigation by the Auditor General (AG) uncovered discrepancies with the procurement, including the fact that the company had never supplied such equipment before, although this had been one of the criteria for the award of the contract.

In January, the company delivered a bulldozer but the machine did not fit the specifications of the contract—a D3 bulldozer was requested, but a D4 was supplied—and the machine, following inspections, appeared to be damaged.

However, as the Regional Executive Officer (REO) Kim Williams-Stephen yesterday confirmed, the region had accepted the equipment, signed off verifying that it was supplied and made the full payment of $15 million to the supplier. This led PAC Chairman Irfaan Ali to question what claim the region is now entitled to. “So what are you claiming? You have no claim,” Ali stated, after the REO informed the committee that the region had a bond put in place.

But Ali’s statement was based on the AG’s report that there had been no performance bond enforced with the original contract.

Williams-Stephen reported yesterday that after the issue arose, they sought legal advice, and acting on that, had a bond instituted to the tune of $14.8 million. That bond was reportedly issued by the Caricom General Insurance Company. However, the REO had also reported that there had been no new contractual agreement between the two parties. This led Ali to question how a bond could be in place without an existing contract. “… You’re going into a new arrangement with him and you don’t have a contract?” Ali questioned.

The REO said she could not provide an explanation for why a new contract was not written up, and stated that at the time her only thought was on the recovery of the item or the money spent.

She related that as far as she is aware, the item is not in-country, and said that they have not been provided with any proof that the item has been shipped. Hence, the region wrote to the insurance company on June 8 to claim the bond.

Ali stated that a bond could not be issued by an insurance company without a contract being in a place, and urged the Auditor General to also look into that situation.

Discrepancies

Meanwhile, other issues related to the purchase were also brought to the fore yesterday.

According to a report from the AG, which was based on a special investigation into the matter, there were a number of discrepancies with the purchase, including the fact that K&P had never supplied equipment of that nature prior to the contract being awarded, although that was a qualifying criterion; that the company was paid an advance of 62.69% of the contract sum, although that was not a part of the contractual arrangement; that the region had not examined the machine for defects before receiving it; and that the AG’s inspection revealed a number of unsatisfactory features.

Ali, who read the summary of the report, also related that photographs of the bulldozer were attached to the document.

“The chassis plate appears to have been tampered with…you have damaged belts…a unit was seen hanging without any nut, rough welding and fabrication works and damaged rubber mount, vial and cable,” the Chairman related.

The equipment, Williams-Stephen had said, was signed off by the senior superintendent of works. It is unclear whether he had any documentation to guide him on what needed to be accounted for.

It was related yesterday that the supplier indicated to the region that attempts were made to source the 3D bulldozer, but the cost exceeded the sum of the contract.

Asked by Member of Parliament Jermaine Figueira whether any measures have been put in place to ensure that there is no recurrence of a situation like this in the future, Williams-Stephen related that not only does the region have prequalified engineers to examine purchased equipment, but engineers attached to the Ministry of Public Infrastructure also assist in that task.

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