The Government of Guyana continued to make overpayments to contractors throughout the 2018 fiscal year, according to the unreleased Auditor General’s (AG) report.
In the report, which was seen by Sunday Stabroek, AG Deodat Sharma noted that 157 instances of overpayments amounting to $166.076 million were made in respect of measured works on 90 contracts administered by ministries, departments and regions in 2018.
Amounts totalling $73.709 million were in relation to the regions, of which $56.528 million or approximately 77% were from regions Two, Eight, Nine and Ten.
As it relates to the Ministries/Departments, a total of $92.367 million in overpayments were noted, of which amounts totalling $63.741 million and $8.330 million or approximately 69% and 9% were from the Ministry of Public Infrastructure and the Ministry of Social Protection, respectively.
According to the report, at the time of reporting in September 2019, a total of $20.041 million had been recovered, including $10.503 million in respect of ministries/departments and $9.538 million in respect of regions.
“Taking these repayments into account, overpayments totalling $146.035 million remained outstanding,” the report noted.
At the Ministry of Public Infrastructure, the largest single instance of overpayment related to a sum in excess of $50 million for works which were incomplete as of September 2019.
The report explains that a physical verification of the rehabilitation of the Compound Road in Mabaruma revealed that works were in progress, with only half of the total width for the reinforced concrete roadway completed along a section of the road.
The contract for the rehabilitation had been awarded in May 2018 in the sum of $90.532 million, with $74.914 million paid at 31st December, 2018.
According to contract documents, the works comprised the scarification and application of laterite and sand stone base, construction of reinforced concrete rigid pavement and associated drainage works and construction of a reinforced concrete and steel bridge along a section of roadway.
Payment Certificate №. 4-Valuation №. 3 shows that full payments were made for ‘site and earthworks’ and the reinforced concrete slipper drains and drain, along with 95.7% of the total cost for the reinforced concrete pavement, and 80.9% of the total cost for the steel bridge. However, photographs taken at the time of the physical verification in August 2019 clearly show that the Ministry made payments for works which were not completed.
Specifically $57,741,000 in overpayments was found to have been made and it was discovered that though the sum of $8.930 million was paid to the contractor for the supply and installation of pre-cast pre-stressed concrete piles for the bridge construction, timber piles encased on HDPE pipes were used instead.
Further, while the contract specifies the duration for the completion of the works was five months at the time of the physical verification, a total of 15 months had elapsed since the contract was signed.
The Permanent Secretary (PS) is recorded as providing several reasons to the Audit Office for the delay in the project, including heavy and extended rainfall, a Geotechnical Investigation which was a prerequisite to the actual construction of the bridge, a redesign of the superstructure based on the geotechnical report and onsite conditions, relocation of utilities and the procurement of a specially sized steel girder.
According to the PS, these delays led to the contractor being granted an extension of time with a revised completion date of 14 October 2019, after which liquidated damages would be applied.
The Audit Office subsequently recommended that the Head of Budget Agency take action to improve the planning of projects so that provisions can be made for such issues.
At the Ministry of Social Protection, an overpayment of $166,800 was recorded at the construction of a bridge at Skills Training Facility, Eccles East Bank Demerara.
A contract has been awarded in April 2018 in the sum of $996,790 by the Ministerial Tender Board against an Engineer’s Estimate of $1.644M to the lowest of four bidders.
While the full contract sum was paid to the contractor a physical verification conducted on 19 June 2019, of the completed works, measurements and calculations found that overpayments had been made on the provision of materials.
The 2018 AG’s report was presented to Speaker of the National Assembly Dr Barton Scotland on September 30th last year but was not laid in the Assembly prior to its dissolution last month.
