$4.6B GPL project…Opposition calls for Public Procurement Commission to probe “polluted” contract

Jan 31, 2017 News

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The controversial awarding of the $4.6B contract to a Chinese-owned company for the Component

‘A’ of the Power Utility Upgrade Programme (PUUP), continues to attract scrutiny with the Parliamentary Opposition – the People’s Progressive Party Civic (PPP/C) issuing a call for the contract to go to the Public Procurement Commission (PPC).
Issuing the call on behalf of the Opposition was Member of Parliament (MP), Odinga Lumumba, during the sitting of the 60th Sitting of the National Assembly last evening as the house debated a motion tabled by PPP/C’s MP, Bishop Juan Edghill.
The motion was for the Guyana Power and Light (GPL) and Government, to abide by the procurement laws – among other things – to ensure that contracts are fairly and transparently awarded.
Lumumba said that this “particular scandal-prone project “is an Inter-American Development Bank (IDB)/European Union (IDB/EU)-funded project with the objective to reduce technical and commercial losses to the GPL.
The Parliamentarian posited that the matter be taken to the Public Procurement Commission in order to find a resolution while adding that the Chairman of GPL, Robert Badal’s call for more transparency within the agency was a tad “too late”.
He said that while Badal was not specific for his reason to make such a call, it can be interpreted that he is also “burdened” by the decision to grant the Chinese company, China National Machinery Import and Export (CMC), the contract.
“I need to remind Mr. Badal that he cannot go toward selective tendering. Any tender process should be open, and available to all. Every tender board and every Government make mistakes. Mistakes are part of life.
“But when you make mistakes and you know it is a mistake, you must correct it, or find ways to correct it.”
Lumumba said that the project is vital to the long term efficiency of GPL but “incompetence and

political interference has led to a delay of over 12 months.
“During this period, the decision making process has been polluted by different sets of evaluators and as of today, the issue is still tarnished by accusations and counter-accusations. “
He also issued a call for the National Assembly’s Public Accounts Committee to be provided with the names of the evaluators.
There were five bidders, the lowest of which were two Guyanese companies in partnership with foreign entities.
Cummings Electrical Company Limited’s bid price was announced at $3.6B and Fix-it Depot‘s bid was $3.5B. Both were $1B and $1.3B lower than the bid price of CMC ($4.6B), Lumumba said.
“Government and GPL are armed with the requisite information to annul this process and select either of the two local bidders.”
Price is not only determinant
But Minister of Public Infrastructure, David Patterson, said that price is not the only determinant in the award of a contract.
“There were local companies involved. I do not want to highlight deficiencies in anybody but I would like to highlight to this House of the requirements that were in the bidding document which all contractors will have to abide by…the average building of construction work over at least three years, at least 25 percent of the budget.
“What that means is that within the last three years, you must be able to demonstrate that you have done work to this amount— $970M; you must demonstrate that you won a contract to that amount. There were five bidders and two failed on that.”
Experience as a prime contractor in construction in at least three works of a similar nature and complexity, equivalent to the works over the last five years was also a requirement. Of the five bidders, three failed on that, the Minister

said.
“(They were required to show) that (the bidding company) can ensure the timely availability of the essential equipments listed in the bid document – two failed.
“(Be able to hire) a contract manger with five years’ experience – everybody passed that one.
“The minimum amount of liquid assets and credit facilities, liquidity ratio, proof of access to lines of credit; there are several criteria that everyone has to fulfill.
“The bidders were written to, saying these are the areas they did not satisfy.”
Process not stalled
The Ministers said that the project has not been stalled.
“The IDB and the EU have reviewed the procurement regulations. They have reviewed the matters referred to them and they are proceeding. However, we are in the process of paying.
“The appeals have been dismissed. So the statements being made that we have been held up is incorrect. These were the criteria that were set out by IDB and the EU and they were satisfied with the award. “

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