Northern Region Water Board has written the Office of the Director of Public Procurement to take action against Plem Construction Limited saying the firm violated procurement procedures for the K14 billion Mzimba Integrated Urban Water and Sanitation project.
But Plem director Mohan Khrishnan said the allegations are baseless and aimed at diverting attention away from what he describes as “the real issue”.
The award of the contract has been mired in a controversy whose origin is the discrepancy between the initial amount of $10.1 million to the final figure of $14.7 million for which the winning firm was awarded the contract.
The tender was for the supply and delivery of 15 000 prepaid water meters.
Six contractors submitted bids for the $22.85 million (K17 billion) Mzimba Integrated Urban Water and Sanitation Project (IUWSP).
The project is being co-funded by the African Development Bank Group (AfDB) at $14.85 million (K10.6 billion), Opec Fund for International Development Fund for $5 million (about K3.7 billion) and the Malawi Government at $3 million (about K2 billion).
In a letter to ODPP dated June 14 2017, NRWB chief executive officer Titus Mtegha says Plem Construction Limited director Mohan Khrishnan sent him WhatsApp messages before the bid results for the project were made public—questioning why his company was not picked as the lowest bidder.
Khrishnan allegedly accused Mtegha of receiving ‘big bucks’ from the company that won the tender.
He is also said to have threatened to drag the board to court to stop the tender process.
Mtegha says Khrishnan sent the WhatsApp messages while the board was still in the process of carrying out evaluations of bids on February 28 2017.
Mtegha says in the letter that the board was reporting the matter to the ODPP as a regulatory body on procurement for necessary action against the bidder for interfering with the bid evaluation process contrary to the instructions to bidders as well as the Public Procurement Act 2003.
The letter from NRWB with copies of the alleged WhatsApp messages, is copied to the Resident Representative of AfDB—the financier of the $14.7 million—the Secretary to Treasury and Secretary for Agriculture.
In an e-mail response Khrishnan said Plem has nothing to do with the tender.
In the letter to the ODPP, Mtegha said during evaluation all bids that the NRWB received were subjected to a preliminary examination on the basis of commercial responsiveness and technical responsiveness according to the evaluation criteria contained in the bidding documents which were approved by the African Development Bank.
ODPP director general Paul Taulo in a telephone interview on Thursday confirmed to have received the letter.
“We have received the letter [from NRWB]. The Regulation and Review Department will meet to look at the nature and gravity of the complaint,” he said.
According to the Public Procurement Act (2003) Section 18(6) any person who contravenes subsection 5 shall be guilty of an offence and shall be liable to a fine of K50 000 and to imprisonment for two years and in addition be liable to disciplinary action.
An evaluation committee, chaired by NRWB director for technical services Mwiza Mtawali recommended that the corrected bid from the winning firm of $14.7 million was the lowest and most responsive.
The controversy over the discrepancy between the initial bid amount of $10.1 million to the final figure of $14.7 million for which the winning firm was awarded the contract. NRWB says the change in the figure was an arithmetical error.
Mtegha told Weekend Nation yesterday it was normal in procurement for bidders to make arithmetical mistakes and in the case of the Mzimba project, the winning firm skipped a whole line of items when adding up their items.
“Before evaluation, we did an arithmetical checking and it was discovered that the whole line of items was skipped during the addition. The awarding of the bid to Sawa Group was based on the evaluated amount not the bidding amount. We took into account the arithmetical err,” he said.
Mtegha further said if the board went ahead to award the tender based on the tendered amount, the board could in future, have faced problems as there would have been a need to finance the missed items.
He further dispelled speculations that the jump from $10.1 million to $14.7 million was effected after the contract was signed saying AfDB gave a ‘No Objection’ based on the recalculated amount of $14.7 million and not the $10.1 million.
In May, a Joint Parliamentary Committee on Agriculture and Public Accounts launched a probe on the issue.
The committee has since demanded all documents relating to the contract.