Law provides for cancellation of $865M pump station contract – Ramjattan

Apr 20, 2024 News

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Kaieteur News – The laws of Guyana allow for the cancellation of the $865M Belle Vue pump station contract that was awarded to TEPUI – the company closely linked to Mikhail Rodrigues also known as ‘Guyanese Critic’, Leader of the Alliance for Change (AFC) Khemraj Ramjattan said on Friday.

Ramjattan was at the time addressing reporters at his party’s weekly press conference.

The Public Procurement Commission (PPC) earlier this week revealed that TEPUI failed miserably during the evaluation process for bids at the level of the National Procurement and Tender Administration Board (NPTAB), but was still handed a $865 million contract to build a pump station at Belle Vue, West Bank Demerara (WBD).

In fact, Rodrigues’ company beat off 26 other bids, 13 of which were described as “substantially responsive,” to win the lucrative deal. This was revealed in a report released by the PPC—the body legally mandated to with oversight and investigative capabilities to monitor public procurement.

The PPC, in its report released on Tuesday highlighted several procurement breaches committed by TEPUI and overlooked by NPTAB in awarding the contract. According to the document which was perused by Kaieteur News, NPTAB ignored several key details when it came to the company satisfying the evaluation criteria for the award of the $865M deal.

The investigation was launched into the award of contract after a complaint was lodged at the PPC by opposition Member of Parliament, David Patterson who raised concerns over the questionable circumstances under which the contract was awarded.  For its part, NPTAB had previously defended the contract award to TEPUI claiming that it follows the systems, processes and procedures enshrined in the Procurement Act and its regulations in the award of contracts.

The Tender Board had explained that in any bid, there are administrative, technical and financial criteria to be followed which are assessed by the Evaluation Committee in making its recommendation to NPTAB.

“These criteria are all fully enshrined in the specific tender document applicable to the specific procurement, whether for goods, works or services,” the tender board said.

However, in its report, the PPC underlined the fact that the company failed to satisfy several technical criteria for the specific award but was still given the contract.  According to the report, the contractor-TEPUI – did not demonstrate that it had construction experience or “[completed] projects of a similar nature” as the Belle Vue pump station project.

The commission noting that the works for which the contracts were submitted by TEPUI were neither for a “pump station, sluice and or drainage structure” as specified in the evaluation criteria nor were any, by TEPUI’s own admission, completed, also as required by the said criteria.

Another requirement for the successful bidder is to provide evidence of financial capacity representing (30%) of the bid price. Bidder must provide a bank statement or LINE of credit from a bank or a recognized financial institution. The criterion has a number of levels within it which are to be satisfied. The first, being a bank statement or line of credit from a “recognized financial institution”. The record reflects the submission by TEPUI of a line of credit issued by Puran Brothers ‘Top Mix.’

The PPC noted that in the absence of bank statements, which are not reflected in the record as having been submitted, a line of credit from a “bank” or “recognized financial institution” is required. What is a “recognized financial institution” is not defined.

Notwithstanding, the issuer must at least be a “financial institution”. What is a financial institution is defined by law, pursuant to the Financial Institutions Act, Cap. 85:03 and in accordance therewith, must be licensed by the Bank of Guyana (Sections 2 and 3). [A bank must be similarly licensed by the Bank of Guyana in accordance with the said Act.]

Notwithstanding, the contract was not cancelled or no recommendation for remedial action put forward.

“The law provides for the Public Procurement Commission under Article 212 (A) (A), after its investigation of any mismanagement or in relation to any procurement complaint, the power to propose remedial action, and in that context it has the power and jurisdiction and duty,” Ramjattan said.

He added, “We in the Constitution… as a constitution framer never intended that you can’t propose some remedial action.”

Meanwhile, in a statement issued by the AFC, the party described the recent majority recommendation of the PPC as “shamelessly objectionable, unfair and yet another knockdown of a guardrail of our fragile democracy.”

“What has been hidden from the public is that the purported Summary of Findings comprises of only a majority recommendation of Ms. Chase, Mr. Bhagwandin and Mr. Singh. The minority recommendation of Ms. Rajcumar and Mr. Berkley Wickham is vastly different. All five Commissioners agreed that Tepui on all counts was been guilty of serious evaluation disqualifications. Tepui’s bid failed grievously on every evaluation criteria as found unanimously by 5 Commissioners,” the party said noting that the minority recommendation is that, and which is not captured in the Summary of Findings, the Tepui bid must be deemed non-responsive and should be retendered.

“The AFC finds it amazing that a bid which did not meet any of the evaluation criteria could have been passed by the Evaluation Committee, then NPTAB and then find blessings and approval by Cabinet,” the statement said.

Additionally, the party said that the PPC recommendation that it cannot propose any remedial action pursuant to a massive misapplication of privity of contract ruined the situation more.

“This kind of misconceived “lenience” ought to have come only from the interested parties who want to see the award go to a friend. It should never have come from a constitutional body which was fought long and hard for to be a check and balanced against Executive lawlessness in procurement matters.

The AFC finds the legal device of privity of contract (by the three Commissioners) to allow the award, which ought to have been vitiated ab initio, as an abomination and an abdication of their duty to protect against fraud and corruption in procurement matters.”

The party reiterated that the Commissioners abandoned their power under the law by failing to “propose remedial action”.

In light of the posture taken by the three Commissioners, the AFC “demands the immediate resignation”.

“Additionally, NPTAB must be reconstituted. The irony of it all is that they are being paid hundreds of millions to grant a disqualified tenderer/bidder a $865 million contract. This certainly disqualifies them.”

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• cancelled, Contract, Khemraj Ramjattan, Public Procurement Commission, remedial action

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