The Anti-Corruption Bureau (ACB) has refused to clear a K10 billion water project contract and accused Southern Region Water Board (SRWB) of breaching procedure in awarding the tender.
In an interview yesterday, ACB senior public relations officer Egritta Ndala said the bureau received the SRWB request on October 27 2020.
She said: “However, it [the request] has been sent back to them [SRWB] with advice that they should send it to PPDA [Public Procurement and Disposal of Assets Authority] as the bureau does not directly deal with procuring entities.
“It [the bureau] receives requests for vetting from the PPDA, not directly from the institutions.”
In a written response yesterday, PPDA public relations officer Grace Thipa said the institution does not have records on SRWB’s procurement. She said the contract did not go through PPDA because it was financier-driven; hence, outside the institution’s jurisdiction. financier-driven; hence, outside
Said Thipa: “You may wish to note that that PPDA Act applies only to procurement involving public funds and disposal of public assets, but not where it is mandatory to follow the guidelines of a financing agency.
“This means that in situations where procuring and disposing entities [PDEs] are using financer’s guidelines, such requests do not go through the PPDA’s vetting processes.”
The developments come against a background of procurement specialists faulting the manner SRWB awarded a multi-billion kwacha contract to a firm that charged K1.6 billion more than the lowest evaluated bidder with technical capacity.
The evaluation report on the bids showed that the lowest bidder “passed” both preliminary examination and detailed technical evaluation, but could not be picked purportedly because the low pricing showed lack of understanding of the “technicalities and complexities” of the project.
In June this year, SRWB advertised for a tender to do detailed designs and construction works for the extension of Mangochi Potable Water Supply Project funded by the Kuwait Fund for Arab Economic Development (KFAED).
The evaluation report The Nation has seen shows that 14 companies bought the bid document, but only four submitted their proposals.
Jiangsu Suzhong Construction Group Company Limited made a bid of $16.3 million, Alghanim/ Plem quoted $14.4 million, Sawa Group/Metito joint venture priced its bid at $21.7 million while Kuwait Dynamic Limited/ Fisd partnership offered $12.3 million.
Both the Public Procurement and Disposal of Assets Act and the bidding document for the tender in question indicated that preference would be given to “the lowest evaluated bidder”.
Evaluation procedure requires bidders to go through preliminary evaluation and successful ones proceed to technical and detailed assessment. Only successful bidders are subjected to the financial evaluation where they compete on pricing.
The Centre for Democracy and Economic Development Initiatives, a governance civil society organisation, has since lodged a complaint with ACB calling for a probe into
the matter. lodged a complaint with ACB calling for a probe into ACB director general Reyneck Matemba confirmed receiving the complaint from the CSO.
And speaking during a Mindset Change public lecture Vice-President Saulos Chilima delivered at Bingu International Convention Centre last Friday, President Lazarus Chakwera commented on the K10 billion water supply project when he appealed to Malawians to desist from social media gossip and focus on critical issues, including the tender in question.
Said the President: “When we still have young men in our universities gang raping female students or a suspicious K10 billion contract at one parastatal company to investigate or a railway project to move goods to and from the sea, we cannot afford to waste our time on social media gossip…”
But despite the mist surrounding the award of the contract, project financier Kuwait Fund has already granted a no objection to have the contract awarded to Alghanim International General Trading in a joint venture with Malawian firm Plem Construction.
SRWB has already submitted a draft contract to Kuwait Fund and the financier is currently reviewing it.
But while PPDA feigns ignorance on the contract, SRWB wrote the director general of PPDA on October 2020 notifying him that they had identified Alghanim/ Plem joint venture to undertake the project.
In an earlier interview when The Nation broke the story on October 23 2020, procurement specialist Amos Nyambo faulted the justification of the evaluation. He said at financial stage the evaluation should have considered financial-related matters and not technical issues.
He said: “If the bidder reaches financial stage it means they have done well on preliminary evaluation and technical/detailed examination.”
Another procurement specialist, who works in the public sector, said if the lowest bidder had no experience they should not have proceeded to the next stage.
In the report, the evaluators acknowledged that Kuwait Dynamic Limited/Fisd quoted “noticeably lower prices for the items under the general requirements and preliminaries when compared to other bidders; hence, they fall lowest in this division with a difference of 21.42 percent lesser than the highest quoted amount in this division”.
Kuwait Dynamic Limited/Fisd also scored points for quoting considerably lower rates for the mechanical works, but, ironically, the low price became a ground for disqualification.
The report said Alghanim/Plem , which quoted K10.9 billion and K1.6 billion higher than Kuwait Dynamics/Fisd’s K9.3 billion, was awarded the contract.
Both Plem and Fisd are Malawian-owned businesses which partnered foreign firms.
In an earlier interview yesterday, SRWB chief executive officer James Chitete did not quite agree with The Nation findings, saying the evaluation team included those appointed by the financier; hence, no likelihood for manipulation of results.
Ironically, Fisd had previously worked on a similar project for SRWB.