Shrouding the contretemps between the government and Fedders-Lloyd over the contract for the specialty hospital is the stark fact that the infrastructure for the most rigorous examination of complaints by bidders – the Public Procurement Commission (PPC) – is still not in existence, more than a decade after it was catered for in groundbreaking constitutional reform.
Therefore, with the current architecture, any review of the concerns of Fedders-Lloyd will fall short of the most searching enquiry and will probably be conducted by people who do the bidding of the government, thereby failing to settle a dispute which can have downstream repercussions.
Why the PPC has not been created has been the subject of suspicion for some time. It is the belief that the government for the 10 years prior to this one has been disinclined to entertain any review of procurement decisions that have been steered and shaped to fit favoured bidders. On the other hand the opposition has been powerless to override the government’s obstinacy on this matter although the result of the November 28, 2011 general elections has opened op greater possibilities. Still, even though the opposition can control what happens at the nominating forum – the Public Accounts Committee – by virtue of its one-seat majority in Parliament, the nominees of the PPC still have to be committed to the full National Assembly where they have to be approved by not less than two-thirds of the members. It therefore requires a deal between the government and the opposition. The government therefore has the final say and will not concede easily. The end of the parliamentary recess will have to be awaited to test this.
In respect of the Fedders-Lloyd complaint, the applicable functions and responsibilities of the PPC set out in the Constitution would have been as follows: 212AA. (1) (h) to (J): Investigate complaints from suppliers, contractors and public entities and propose remedial action; Investigate cases of irregularity and mismanagement, and propose remedial action; Initiate investigations to facilitate the effective functioning of public procurement systems. These would be exactly the areas that Fedders-Lloyd would have wanted to see investigated in the present dispute. Except that there is nothing that presently caters for these lines of inquiry and it is yet unclear how the government will satisfy Fedders-Lloyd.
Hopefully, the review process will be far more enlightened and sober than the Ministry of Health’s September 4th release on the matter which was littered with invective and unnecessarily confrontational. The Procurement Act will have to be examined in respect of the allegations by both sides of the breaching of procedures to determine what weight should be given to matters that could have resulted in Fedders-Lloyd’s being excluded on administrative grounds. Fedders-Lloyd has also pointed out that it is yet to be told specifically what made its bid non-responsive. It is also worthy of note that this project took off on very shaky grounds. Groundwork started on the site for the hospital at Turkeyen in January but geotechnical work wasn’t sought until around March. When it was sought, the only known expert here declined on the grounds of the shoddiness and incompetence that attends these government projects. The requisite work was then supposedly done by persons from the University of Guyana but it is yet unclear to what standards this work was done.
Without the presence of the overarching PPC, the evaluation committees which come under the National Procurement and Tender Administration Board (NPTAB) are stacked with government supporters and government-appointed officials and thereby become clearing houses for decisions made with the government in mind or influenced by the government. There can be little doubt that this happens. The decisions of the evaluation committees then go to the NPTAB to be ratified possibly without any deeper examination or re-evaluation of the committee’s work.
A review of this Fedders-Lloyd decision should require the NPTAB and the evaluation committee to hand over minutes of all the meetings that they held and a description of the manner in which the final decision was made, accompanied by all of the relevant documentation. Only then will there be any confidence that a fair review will be done. Anything less than this – and this is a reasonable course of action – would likely trigger further protests by Fedders-Lloyd and a muddying of the waters for investors here.
Apart from how any review of the bidding process might turn out, there are two other inescapable concerns of stakeholders and the interested public.
The first has to do with the perception that the government attracts and awards huge contracts to persons and entities thoroughly unsuited to the task. Two examples spring to mind immediately but there are numerous others. The Amaila Fall roads and the contract to Mr Fip Motilall and the massive Skeldon sugar factory to the Chinese company CNTIC stand out for the sheer vulgarity of the decision making. Mr Motilall had shadowed the hydropower project from the very start and for years. Throughout this period nothing in his resume led one to believe that he could fulfil the tasks of marshalling the financing, building the hydropower project or undertaking ancillary services. At best he was a middle man. Yet, despite repeated warnings and questions about his background in road building, the Jagdeo administration awarded him a huge road building contract – US$15.4M – that was in trouble almost from the very start. It had to be shamefacedly cancelled very early on in the life of this administration.
The construction of the Skeldon factory by CNTIC is another example of grave recklessness and there should be a forensic dissection of how the decision was made. CNTIC had not built a sugar factory like this ever. Would any poor country entrust their flagship, prestige project to a company that has had no experience of such? The Jagdeo administration still has a lot of explaining to do here. The disastrous performance of the factory and the expensive rectification work that will have to be done are incisive testimony of this misadventure.
The public is left to wonder if the same kind of boat will be embarked upon with Surendra – bear in mind that its work at the Enmore packaging plant was said to be a contributing factor in the death by explosion of a long-serving employee and there were other problems that had to be addressed. Would it be capable of building this specialty hospital and what evidence is in the public domain on this? Why wouldn’t Fedders-Lloyd be a better choice considering the numerous hospital construction projects it has been engaged in compared to the zero for Surendra?
The other concern that will filter into the consciousness of the thinking member of the public is the clear squiring of favoured companies for not one project or two but more. This has very unseemly implications and suggests that the procurement system is being subverted. Surendra first won a $2.4B contract for Enmore. The grounds of their success here were not challenged but it would still make interesting reading if it were revisited. Surendra was then shockingly promoted for a role which had never been advertised – management of the Skeldon factory. This, not very long after Booker-Tate had been dismissed by government from its management contract with the retort that Guyana’s managers were quite capable of discharging these functions. The linking of Surendra to Skeldon in the context of the Enmore contract and now the specialty hospital is most disconcerting. Interestingly, once the media questioned the basis of a management contract for GuySuCo, the mention of Surendra evaporated until its reappearance amid the specialty hospital contract. There is apparently something special about Surendra and for all these reasons and others there should be a magisterial review of its bid for this latest contract.
