During the fiscal year of 2018 the administration of Region 9: Upper Takutu – Upper Essequibo was cited for millions in overpayments as well as for the acceptance of poorly executed or shoddy work.
Stabroek News has previously reported that Auditor General Deodat Sharma has directed the administration to recover in excess of $12 million paid to a contractor for the upgrading of a section of the road at Culvert City, Central Rupununi under Capital Works but he has also listed a plethora of concerns about recurrent expenditures.
In his report he noted that amounts totalling $383.013 million were expended on various maintenance works during the year including repairs to a section of road at St. Ignatius, Central Rupununi, repairs to Farm to Market Roads at Parishara, Central Rupununi and repairs to Achawib Primary School, Deep South Rupununi.
In relation to the repair of the road at St. Ignatius the contract was awarded by the Regional Tender Board in the sum of $8.2 million to the fifth lowest responsive of seven bidders.
The contractor received the full contract sum for completed works at the time of audit but physical verification of the completed works, measurements and calculations revealed an overpayment of $3.410 million.
While the AG has advised that the region recover the overpayment and ensure that all works completed are correctly measured and quantified before payments are made to contractors, the Regional Executive Officer has committed to recovering the overpayment only after the current Engineer has verified the works.
Another contract issued by the region this time for repairs to a Farm to Market Road at Parishara Central Rupununi was cited not for “overpayments” but for possible violation of accounting standards and shoddy work.
The contract was awarded by the Regional Tender Board in the sum of $11.6M to the most responsive of six bidders. At the time of audit this contractor had received the full contract sum for completed works but physical verification of the completed works, measurements and calculations revealed that a completely new timber bridge was constructed under this contract for road repair works, resulting in works of a capital nature being executed and paid for using recurrent funds.
The value of this newly constructed bridge was $5.7 million and it was priced and paid for as one lump sum Item in the Bill of Quantity, while the finished works were substandard, crooked and had poor quality timber installed.
Surprisingly the Audit Office has highlighted two contracts of vastly different sums for the same works.
According to the report a contract for Repairs to Achawib Primary School, Deep South Rupununi was first awarded by the Regional Tender Board in the sum of $10 million to the most responsive of four bidders.
The contractor received an advance payment of $2.940 million but physical verifications and examinations of records revealed that the contractor never mobilised to the site, as such he was overpaid the sum of $2.940 million.
An examination of the evaluation report also revealed that the awarded contractor’s bid price was actually $10.054 million, however, the contract was signed for the sum of $10 million, which was the Engineer’s Estimate.
Correspond
According to the report it is unclear how and why the Regional Democratic Council signed a contract for a sum which does not correspond with the contractor’s bid and there was no evidence that the contractor ever provided a mobilization bond yet he still received the payment.
Further at the time of reporting, there was no evidence that the contract was ever terminated, despite the fact that the contractor failed to pursue the works and the works were subsequently completed by another contractor under a new contract.
The second contract for this project was issued by the Regional Tender Board in the sum of $7 million to the lowest of three bidders.
The contractor received the full contract sum for completed works at the time of the audit but physical verification of the completed works, measurements and calculations revealed that there was a breach of the Procurement Act in the awarding of a contract valued above $1.5 million using the three-quote method of procurement.
Also while no evaluation of the works was done since they were deemed as emergency works it was observed that the RDC had enough time to obtain three quotes for the works, while the duration for completion was stated as eight weeks.
Further, the Audit Office failed to accept that the works were an emergency since a contract was signed for the same works in May 2018. The RDC would have therefore been fully aware that the repair works were to be effected since May 2018.
“As such, the RDC’s claim of the works being an emergency is invalid since the previous contract should have since been terminated and the works should have been retendered and subjected to National Competitive Bidding (NCB), in keeping with the Procurement Act,” the report notes.
In this case as well an examination of the Tender Board Minutes revealed that the contractor’s bid price was actually $7.365 million but the contract was signed for the Engineer’s Estimate of $7 million.
It was also discovered that the RDC reduced the scope of works under the contract to fit the remaining $7 million from the previous contract omitting the installation of a Photovoltaic power supply system to the school.
Finally the contractor claimed a first interim payment in the value of $4.916 million on December 15, 2018, the same date on which the contract was signed but it is unclear how the contract could have been signed on the same day and works to the aforementioned value could have also been completed on the very date.
Notably the REO was unable to provide an explanation for these findings which have caused the Audit Office to recommend that the RDC adhere to the Procurement Act and ensure all emergency works executed are actually of an emergency nature.
