Government needs to explain why about $800 million worth of steel and other equipment that were earmarked for the now-frozen specialty hospital project, went solely to businessman Brian Tiwarie, former President Donald Ramotar says.
“We took possession of eight containers of steel that Surendra, at the time we took them to court, had on the wharf and that was worth nearly double the $400M they owed us,” Ramotar told Stabroek News yesterday, referring to the first contractor, Surendra Engineering which was dumped from the project after it misled government.
“The public needs to know how after all of that work, that the containers were turned over to BK. How?” Ramotar insisted.
Ramotar was president at the time the controversial contract was signed with Surendra Engineering for the building of the US$18.1M specialty hospital at Lilliendaal, East Coast Demerara. He said while it later turned out that Surendra breached contract stipulations and was taken to court, he wants to make public that his government went to “great lengths” to recover the sums that were paid to the company.
However, he believes those efforts were in vain as after his administration paid the Guyana Revenue Authority the duties and taxes on the imported items, coupled with the grueling legal work that went into finding ways to recover monies from Surendra, the items were “given” to BK International.
Surendra Engineering Company Limited, which was selected in August 2012 amid controversy, was dismissed from the specialty hospital project by the former PPP/C administration on a variety of grounds, including producing false documents. At the time Surendra was booted from the project, it had used up approximately US$4.3M of the overall allocation. It was later sued by the Guyana Government for $965M.
It was this $965M that Ramotar said his government was seeking to recover when it cleared the containers and had them stored at the Ministry of Health.
He said that evaluations of the steel and other items in the eight jumbo containers found that the items were worth nearly $800M. The plan, he said, was to then move to the courts and levy on the items as a means of recovering monies it deemed lost.
“We took it off the wharf and put it at the Ministry of Health…The whole idea was to start proceedings to levy on it so that we could collect back our money. While in that process, the elections came and the government changed and well, we know how that went,” Ramotar said.
“The onus was on the new government to take up where we left off because it was not much more effort that was needed. We did so much…so they should have made sure the process was followed through. Instead now I understand that they handed the containers over to Tiwarie…so our taxpayers have lost and they need to know why,” he insisted.
BK International had also filed claims against Surendra Engineering in local and Indian courts for work done on the specialty hospital site by the company. BK claimed that it was owed $400M for the works.
Enveloped
From the inception, the specialty hospital project had been enveloped in controversy. Last November, the David Granger administration controversially signed a Memorandum of Understanding with Fedders Lloyd, which would have seen the resumption of construction of the hospital. The administration’s handpicked contractor had promised that it would complete the works using the remainder of a US$18 million line of credit that was granted by the Government of India for the project. The remaining sum was pegged at approximately US$13.7 million.
However, the troubled project is now on hold as Fedders Lloyd has been barred by India and the World Bank from participating in such contracts until 2020 due to procurement violations.
Stabroek News had been told previously by a representative of Fedders Lloyd that the company was aware of the containers and items and when it was evaluated, the value was “substantial.” The representative had informed that in addition to land preparation and piling works done at the site, the value of the items in the containers would “somewhat balance” off the sum Fedders Lloyd accepted to complete the hospital.
Sources told Stabroek News that it may be against this background that BK got the containers, as the company, learning that the valuable merchandise was languishing at the Ministry of Health, moved to the courts and levied and won a judgement.
Efforts by Stabroek News to contact BK International’s owner Brian Tiwarie proved futile.
Ramotar believes that Tiwarie made a windfall in getting the containers. “He made a killing on that deal there but I want to know why government would allow that to happen,” he said.
Former Attorney-General Anil Nandlall told Stabroek News that he agrees with his former boss and said an explanation of what happened to the containers needs to be made public. He criticised the current government for its overall handling of the specialty hospital contract.
“We now learn that Fedders Lloyd Corporation Limited has been blacklisted from doing any international contracts by both the Government of India and the World Bank because of “fraud and corrupt practices.”
This revelation has caused the government tremendous embarrassment. In particular, Khemraj Ramjattan and the Alliance for Change (AFC) must be hanging their heads in shame,” Nandlall said.
“After a three-year campaign and lobbying stint by Khemraj Ramjattan, Fedders Lloyd was handpicked by this government to take over the specialty hospital project. I objected and wrote at length that to handpick this company would be a violation of the Procurement Act. Stabroek News, Transparency International (Guyana), and many others called upon the government not to handpick this contractor but to go to public tendering as required by the Procurement Act. I recall Ralph Ramkarran stoutly defending this company and the process of handpicking this company. I hope he too will issue a mea culpa…the Minister of Finance arrogantly asserted that despite all the criticisms, the government will sign the contract with Fedders Lloyd Corporation Limited. Not a word from him now,” he added.
The attorney highlighted the silence of officials on the matter. “Corruption, discrimination and incompetence are quickly becoming the hallmarks of this government. They really fooled a lot of people when they were in Opposition. Now the true nature of the beast is being revealed,” Nandlall declared.
