Former Auditor General Anand Goolsarran and former Attorney General Anil Nandlall yesterday skewered the award of a school feeding juice contract to Surinamese company, Rudisa following a report in yesterday’s Sunday Stabroek that mandatory tests were not done by the food and drug department.
Rudisa’s winning of the over half a billion dollar contract has been challenged by Demerara Distillers Limited (DDL) and Guyana Beverages Inc and the revelations in yesterday’s report that the Government Analyst-Food and Drug Department (GA-FDD) could not do the required testing because of broken equipment could spell trouble for the award. In addition, GA-FDD was not supplied with a juice sample from DDL’s subsidiary, Topco and its Director says had this been done Topco would have come out ahead.
Goolsarran also rejected arguments from the government that DDL’s Topco had had a poor track record and this was why it didn’t win the contract even though it had the lowest bid.
Goolsarran noted that since the Ministry of Education had invited DDL’s Topco to bid for the supply and delivery of juices to the school feeding programme it couldn’t then state a poor track record was why it hadn’t won the award.
He was shocked also to learn that not only was Topco’s product not tested but that the GA-FDD didn’t have the capacity to carry out the tests required by the procuring agency, the Ministry of Education.
“The fact that the Ministry invited DDL to participate in the tendering process for boxed juice for the 2016-2017 School Feeding Programme, clearly suggests that it was satisfied that past performance issues were adequately addressed to its satisfaction. It therefore ought not to use this as a basis for denying the award of the contract to DDL,” Goolsarran told Stabroek News.
Goolsarran pointed to the tender document for the juice where the Ministry of Education this year invited six suppliers to submit tenders for the supply of boxed juice for its School Feeding Programme. According to him, this invitation was based on restricted tendering, as provided for under Section 26 of the Procurement Act 2003.
Four bids were submitted for the contract on May 24 of this year when the National Procurement and Tender Administration Board (NPTAB) opened the tenders at its Main and Urquhart streets office, Georgetown.
The table below reflects the companies that tendered for the contract and their respective amounts.
Since the value of the contract exceeded the $15 million threshold, the NPTAB would have submitted a streamlined evaluation to Cabinet with a request for the offer of a no objection to the award being made to the Rudisa subsidiary, CIDI which was the third lowest bidder.
Topco, the lowest bidder, was not awarded, according to a government release, because the Ministry of Education had past issues with the supplier while the second lowest bidder did not meet the requirement for 25% juice content. The juice content was however not tested by the GA-FDD because of non-functioning equipment.
Goolsarran said that though the Ministry of Education had concerns about DDL’s Topco, the ministry has to take some of the blame.
“DDL has been the supplier of the Ministry’s School Feeding Programme for some time now and has made substantial investments in this regard. However, there were complaints from a number of schools of damaged boxes and expiry dates of its boxed juice. It is understood that the latter was mainly due to a mix-up between the date of the production of the boxes and the expiry date of the juice. This is in addition to the failure by the Ministry to apply the First In First Out (FIFO) method during the distribution of the product. In relation to the former, the damaged boxes were allegedly due to poor handling by the Ministry. In all cases, the product was replaced and the Ministry appeared to be satisfied with the remedial action taken by DDL. As a result, the Ministry did not find it necessary to invoke penalty clauses stipulated in the contract for unsatisfactory performance nor was the contract terminated,” the former Auditor General asserted.
And while he is aware that certain procurement rules provide for a margin of preference for local suppliers and manufacturers, say not more than 10%, in order to protect local industries, he is not sure whether this would be inconsistent with any regional or international rules.
Both DDL and Guyana Beverage Inc have filed complaints with the Bid Protest Committee, in accordance with Section 53 of the Procurement Act.
The Committee is comprised of one member appointed by the Minister of Finance, Attorney JoAnn Bond, who replaced Renee Mc Donald and former GTT Manager Archibald Clifton and Insurance Broker Ewart Adams as the other two members.
The Procurement Act stipulates that the members shall be appointed from among professionals who are particularly competent in the field of procurement. This criterion, with regards to the current committee is of concern to the former Auditor General because of the major role they play in the adjudication of protests by contractors who feel aggrieved.
‘PPC needed urgently’
He stated, “There is, however, concern about the technical competence of current members since they do not appear to have any procurement background. This is particularly so, considering that the decision of the Committee is final and binding on the procuring entity. In other words, there is no recourse to a tribunal or to the Courts. This is unlike the recently established (Public) Procurement Commission whose decision is subject to an appeal to the yet to be established Public Procurement Commission Tribunal with further recourse to the Court of Appeal, provided for under Article 212EE of the Constitution. It is ironical that the Bid Protest Committee, which is a lower body and not a constitutional one at that, can decide on a matter without any appeal to a higher body whereas the decision of the Procurement Commission, a constitutional body, is subject to two levels of appeal. “
“Have the members of the Procurement Commission sworn in as a matter of urgency. In this way, there will no longer be a need for a Bid Protest Committee which has three cases at the moment with which to deal. Once the Commission begins to function, its first task should be to examine critically the procurement rules and make appropriate changes. This is necessary to provide stakeholders, particularly suppliers and contractors, with that degree of assurance they need to enable them to feel satisfied that they are fairly treated. One particular area relates to the functioning of the NPTAB and its reporting relations,” he added.
President David Granger has said that an administrative hiccup in the Terms of Reference (ToR), has delayed his swearing in of the members of the PPC.
“As recently as two weeks ago, a date and time for swearing in had been announced but concerns about the drafting of the ToR delayed it but it is strictly an administrative matter,” the President said when asked by this newspaper about the delay.
Goolsarran believes that DDL has a strong case, and that aside, evaluators should have taken into consideration the nutritional benefits of its product, which is made from natural juice.
Head of the GA-FDD, Marlan Cole told Stabroek News last week that had a sample from Topco been provided by the procuring entity, it would have come out ahead of the other boxes tested because of its natural juice content.
He had pointed to the product saying that not only is it made of natural juices but that the fruits are supplied by local farmers from across the country.
‘Negative spinoff effects’
Goolsarran says that not only those farmers’ markets would be crushed but that the non-award is likely to result in a loss of jobs and a loss of investment in the facility producing the boxed juice. The latter reason he explained was because Caribbean Containers Ltd., which produces the boxes for the juice, will also be adversely affected.
Meanwhile, former Attorney General and People’s Progressive Party Executive Anil Nandlall, weighed in on the contract blasting the restrictive tendering procurement process and the lack of proper quality analysis of the products.
“As the details are emerging it is clear that the award of this contract was influenced by improper considerations. We now learn that no quality analysis was done by the Department of Food and Drugs or indeed anyone else, to test the quality of juice supplied by any of the three companies invited to tender. The procuring entity chose to resort to restrictive tendering as opposed to open tendering…restrictive tendering is akin to pre-qualification. It means, therefore, that these four companies were essentially pre-qualified as companies that are competent and capable of supplying the juice,” he told this newspaper.
“When one resorts to this mechanism, it is virtually impossible to fault one of those companies on the ground that their product suffers from some quality deficiency. This is so because they have already been identified and pre-qualified hence the restrictive tendering. Price, therefore, remains the sole determinant in terms of which company should be awarded the contract. Topco came in the lowest. Guyana Beverage Company the second lowest. Rudisa came in the highest. Against every iota of logic, Rudisa was chosen,” he added.
“In terms of quality, I have already stated that DDL produces beverages under licence for Pepsi Co, one of the largest beverage-producing companies in the world. Therefore, DDL would have been certified and its quality tested by the best in the world,” Nandlall reasoned.
“For these reasons I continue to reiterate that there is more in the mortar than in the pestle,” he added.
