A special investigation by the Auditor General’s office on procurement procedures within the Region Six, East Berbice-Corentyne Regional Democratic Council revealed that the Region’s engineer during 2018 utilised information from a bidding contractor to prepare the Engineer’s Estimate.
The revelation was made when the regional accounting arm appeared before the Public Accounts Committee (PAC) on Monday during the scrutiny of the Auditor General’s 2017 and 2018 reports.
During questioning of the regional officials, it was discovered that the region awarded eight contracts to Associated Construction Inc and all carried a bid price which was identical to the Engineer’s Estimate.
It was also revealed that through prequalification bidding, over 150 minor infrastructural projects in 2017 were done via restricted tendering which is a gross violation of the procurement laws, the PAC informed.
The Committee pointed out that even if an agency engages in prequalification of bidders, unless it is a project where a special service is required or the goods can only be sourced from a handful of firms, restricted tendering should not be allowed.
PAC member and Minister of Governance and Parliamentary Affairs, Gail Teixeira, whilst highlighting the finding, noted that it was “highly suspicious” that eight of the contracts awarded to Associated Construction Inc bore the same figure as the engineer’s estimate.
“One occasion it is rare, but eight times the occurrence it is highly coincidental that the engineer’s estimate and the contractor tender price is the same,” Teixeira said.
Responding to questions on what systems have been put in place to prevent such a recurrence, Regional Executive Officer Narindra Singh responded that since August 2020, engineers have been removed from the bidding process and are only required to submit bills of quantities. However, when Chairman Jermaine Figueira questioned if that was not the regular procedure, Singh was unable to provide a response.
Meanwhile, the Committee was informed that the engineer in question is no longer employed by the region.
The Auditor General’s report found that the “audit examination revealed eight instances… where the contract sum was the same as the Engineer’s Estimate. In addition, each item on the contractor’s Bill of Quantities was identical to that of the engineer’s Bill of Quantities. All eight of these contracts were awarded by the Regional Tender Board of which four were awarded at one sitting. It should be noted that all eight contracts were awarded to one contractor.”
The contractor had submitted tenders for the rehabilitation of roads, maintenance of state-owned buildings as well as drainage and excavation works.
In 2018, the Auditor General’s report found two instances of the issue and highlighted it. In response to these findings, it was stated that the head of the Regional Administration did acknowledge the findings and had committed to preventing such occurrences when they were brought to light in the previous year.
This time, the projects were for the rehabilitation of roads in East Canje and Gibraltar, Fyrish, Corentyne.
“The Audit Office recommends that the Regional Administration investigate this issue and provide the results of the investigation to the Audit Office,” the report suggested.
Former Regional Executive Officer, Kim Stephens, while answering questions for the period in which she functioned as the accounting officer, said that in most instances a maximum of four contractors were selected to participate in the bidding for a project.
She defended the finding of the region awarding over a 150 contracts through restricted tendering by saying that the awarding of the contracts was not a one-person decision. Further, the entire Regional Procurement Board would consider and review the tenders before awarding a contract.
The projects that saw restricted tendering ranged from roads and rehabilitation of bridges, maintenance of buildings and doctors’ quarters, drainage and irrigation works, among others.
In the 2017 report, it was disclosed that 153 contracts to the value of $604.8 million for both current and capital expenditures were not publicly advertised. The services, the report pointed out, were procured by means of restricted tendering.
“The Procurement Act 25(2) states that a procuring entity may use a method of procurement other than Public tendering proceedings in which case the procuring entity shall include in the records a statement of the grounds and circumstances on which it relied to justify the use of that particular method of procurement. However, no such statement was presented for audit scrutiny,” the Auditor General report stated.
The report further stated that in the Procurement Act 26 (1) (a), when the procurement method of Restricted Tendering is used, the procuring entity shall invite all suppliers and contractors to submit tenders.
“However, audit checks revealed that the Regional Tender Board did not invite all its prequalified contractors to submit tenders for which they were qualified,” it added.
An analysis of the Regional Tender Board Minutes shows that the region invited a maximum of four contractors and in some instances less than four, to submit tenders for 140 contracts valued at $570.1 million out of the aforementioned 153 contracts.
When the findings were put to the region, the then REO indicated that the Regional Administration will in future adhere to the Procurement Act.
The Audit Office reiterated that the Regional Administration must comply fully with the Procurement Act at all times.
