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Almost a decade later…Ministry has uphill task recovering over $3M from errant contractor

Jan 12, 2018 News

 

The Ministry of Public Security is still trying to recover over $3M from a contractor that was hired to carry out infrastructural works within the Camp Street prison in 2007.
This was since the Ministry was controlled by the People’s Progressive Party/ Civic (PPP/C)’s Clement Rohee. Back then it was called the Ministry of Home Affairs.
The Audit Office of Guyana has highlighted the fact that the Ministry is still to recover the tax dollars given to the contractor who did not perform as required.
In his 2016 report, Auditor General Deodat Sharma noted that the National Procurement and Tender Administration Board awarded the contract for the construction of the New Capital Dormitory at the Georgetown Prisons to the lowest bidder in the sum of $24.654M in 2007.
However, the contract was terminated in October 2008 after over $21M was paid to the contractor. The reason for the termination of the contract was stated as extreme lack of diligence on the part of the contractor.
The Auditor General noted that an assessment of the completed works revealed that the contractor was overpaid $10.410M.
Sharma wrote, “In this regard, the Ministry levied on a Performance Bond of $12.237M, which was held with the now defunct insurance firm Colonial Life General Company Limited (CLICO). However, the Performance Bond Agreement had expired on 7 June 2009. On 17 January 2011 the Ministry was able to recover the sum of $7.008M from the proceeds of the $12.237M Bond and the balance on the overpayment in the sum of $3.402M was sought.”
The Auditor General said that evidence was seen where the Ministry of Public Security wrote the Ministry of Legal Affairs seeking assistance and advice for the institution of legal proceedings against the contractor. A reminder was sent to the Ministry of Legal Affairs on 12 February 2015 in an effort to conclude this matter. No further action was taken since by the Ministry.
It so turns out that the Ministry dealt itself a bad hand.
The Auditor General stated in his report, “The Head of Budget Agency explained the matter went to Court in 2015 and the Ministry was advised that by accepting the claim for the sum $7.008M initially offered, the Ministry forfeited the right to any further claims. The Ministry was advised that that matter should be dealt with by the Finance Secretary, Ministry of Finance.

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