Following damning auditor’s report… Company begins repaying Govt. for supply of wrong bulldozer to Region Six

Jun 24, 2018 News

K&P Project Management Company which supplied the wrong bulldozer to officials in Region Six (East Berbice/Corentyne), has started to repay Government.

Terry Thomas, Managing Director of K&P Project Management Company.

Managing Director, Terry Thomas, told Kaieteur News yesterday that the company submitted a cheque of $14M to the region and plans to provide the remainder on Monday.
The company had collected the bulldozer from the region as the controversy brewed.
Auditors descended on the region following media reports, that regional officials received a D4 bulldozer in the sum of $14.8M from company in December 2017, when in fact the bid documents had stipulated a D3 bulldozer.
A report from a special investigation done by the Auditor General’s office unearthed major breaches in the transaction. The report was turned over to Regional Executive Officer (REO), Kim Williams-Stephen on June 12.
“We erred. I must admit that,” Thomas said.
Thomas, a former General Manager of the National Insurance Scheme (NIS), explained that the company won the bid for a D3 bulldozer which they should have supplied.
He stated that as they were not getting a D3 at that time at the price in the bid, they thought that they could have supplied a D4 which is a higher specification than what the region wanted.
“What we should have done is write to them to change the specification. We have learnt to stick to whatever the specifications are or seek approval before and not after the fact,” Thomas noted.
The Auditor General’s report stated that the purchase of the D3 bulldozer was not explicitly stated in the region’s approval and that the supplier did not meet one of the qualifying criteria which stipulated that the bidder must have supplied equipment of a similar nature.
According to auditors, a performance security was not enforced and an advance payment of 53% for the contract sum was paid to the supplier, even though the contract did not make provision for such payment.
It was also revealed that the bid document had indicated that a 10% performance security in the amount of $1.5M would be required.
Auditors found no evidence that the security was provided by the supplier, an indication that the requirements of the bid were not enforced by the region.

The bulldozer at the centre of the controversy.

Further, the audit revealed that regional officials did not examine the bulldozer upon its receipt for defects.
When auditors inspected the bulldozer supplied, they found that the chassis plate appeared to have been tampered with; it had a damaged belt, a unit hanging without a nut, rough welding, fabrication works and damaged rubber mount, wire and cable.
The contract was signed on September 12, 2017. Auditors found that the contract included the lines, ‘stop work and periodically cease construction without reason before completion’ and ‘the employer hereby covenants to pay the supplier as per measured works completed’.
This shocked auditors, as it mirrored contracts used by the region for construction works.
The region had also published the invitation for the bid in one newspaper, which is a breach of the Procurement Act, which stipulates that this should be done in newspapers of wide circulation. As a result, only one bid was received.
It remains to be seen if any action would be taken against regional officials who signed off and accepted the delivery of the wrong bulldozer, and those who would have contributed to the discrepancies identified by auditors.