Health Ministry: No laws breached in contract award

Sep 07, 2012 News

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US$18M Specialty Hospital…

The Ministry of Health is insisting that it breached no laws in awarding the Specialty Hospital contract to Surendra Engineering Corporation, but says that Fedders Lloyd Corporation Limited, another India-based company which is questioning the deal, had breached instructions that were given to bidders.
The Health Ministry was at the time responding to Fedders Lloyd Corporation Limited, which submitted one of the lowest bids for the project and is protesting the award of the US$18M contract to Surendra Engineering. Fedders Lloyd had expressed its concerns via a letter to the Permanent Secretary, Ministry of Health, dated August 30th 2012.
The Ministry’s letter was released to the media a day after Cabinet Secretary Dr. Roger announced that Government will be re-assessing the award of the US$18M contract to Surendra Engineering Corporation Limited of India.
In its letter of response, the Ministry of Health said that it “has diligently pursued the process of tendering and awarding the contract to design, build and equip the Specialty Hospital for Guyana with due diligence and full transparency, adhering throughout the process to good, sound and proper policies and procedures.”
“It is obvious to the Ministry that in such an open and competitive process that attracted five bids from reputable Indian firms, only one firm will be successful.”
In its response to six points made by Fedders Lloyd, the Health Ministry acknowledged that the letter from Guyana’s High Commission in India, dated April 13th 2012, announced to all prospective bidders the official “ pre-bid meeting and site visit” was to be held on Monday, 23rd April 2012; the “bid opening” date on 15th May 2012 and the Health Ministry’s intention of no further extension to the bid opening date .
“However, by our letter to all bidders dated 4th May 2012, we officially announced to all bidders “additional information to bidders” following the pre-bid meeting of 23rd April 2012. In that letter our Project Manager wrote as follows:
“Further, two of the contractors during the recent pre-bid meeting and site visit requested an extension of the closing date for submission by at least one more month. The closing date for the submission was 15th May 2012. The client has considered this request and has decided to grant a further extension for the submission of bids to Tuesday 26th June 2012.”
According to the Health Ministry, as is usual in such circumstances, and in order to allow for the most competitive process by facilitating the largest number of interested bidders to participate in the process, the Ministry of Health took the decision it did at the pre-bid meeting.
“This does not in any way or circumstance violate any stipulation of international competitive bidding,” the Ministry’s letter stated in countering Fedders Lloyd. “On the contrary this is a standard procedure and is intended mainly to facilitate the widest participation in the bidding process.”
The Ministry also noted that the question of the bid security and the originating source “has been a matter of numerous press commentaries by Fedders Lloyd Corporation and now finally a matter of concern in your official correspondence to the Ministry.”
“There is no evidence that the bid security was supplied by the Axis Bank of India with correspondence Bank relations in Guyana. This is in breach of the instructions to bidders and on technical grounds Fedders Lloyd should have been disqualified on this ground alone.” Nevertheless, the Ministry said, the evaluation committee did not disqualify Fedders Lloyd on this ground. On the other hand, the winning bidder supplied its bid security from an Indian Bank with correspondence banking relations with a local bank.”
According to the Health Ministry, the official price of a bid is what is contained in the Contractor’s Bid which is an obligatory, non contestable issue.
The Ministry of Health said it is not responsible for the lack of knowledge and or understanding of Fedders Lloyd to the evaluation criteria.
“Clearly neither technical nor financial compliance is of any material value if the tenderer fails administrative compliance.”
According to the Ministry, the fact that Fedders Lloyd works in many areas and in several countries and is engaged in an assortment of activities is not a unique nor propriety feature of the Fedders Lloyd Corporation.
“While it is information that is useful to know, such information is not factored into the rigorous and detailed criteria used to assess the “lowest evaluated bidder” for the project. The Ministry of Health wishes to thank the Fedders Lloyd Corporation for participating in the bid for the “design, build and equip” of the Specialty Hospital in Guyana. We trust that your concerns have been allayed and that your corporation has accepted that we have endeavored to openly and transparently assess the best offer made to the country.”
Government will be re-assessing the award of the US$18M contract to Surendra Engineering Corporation Limited of India to build a specialty hospital at Turkeyen.
Construction Firm, Fedders Lloyd Corporation Limited, which submitted one of the lowest bids for the project, has protested the award of the contract.
On Wednesday, Dr. Roger Luncheon confirmed that the aggrieved bidder lodged a protest with the procurement entity, Ministry of Health. He noted that this is in accordance with protest provisions under the Procurement Act.
The hospital is being funded with a line of credit from India of US$18 million. Government intends to staff the hospital with specialists from India to do complicated surgeries, ranging from heart operations and organ transplants to cosmetic surgery.
Fedders Lloyd had asserted that Surendra Engineering should have been disqualified as a bidder. “As per the bid opening readouts, we noticed that the Bank Guarantee submitted by Surendra Engineering was on the Indian bank letterhead and it was never confirmed by any local bank in Guyana… This outrightly disqualifies Surendra Engineering and makes them a non-responsive bidder in the first place.”

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