Discarded passports supplier Techno Brain is demanding $20 million (about K20.6 billion) from the Malawi Government for services rendered before the termination of its build, operate and transfer contract in October 2021.
The government has since entered into discussions with the contractor to resolve the issue surrounding the $60 million (about K61.8 billion) passport deal.
Attorney General (AG) Thabo Chakaka Nyirenda, who is leading the discussion also comprising representatives of Ministry of Finance and Economic Affairs as well as Department of Immigration and Citizenship Services, confirmed in an interview yesterday that talks are underway on the payment the firm is demanding from government.
He said: “Negotiations are at an advanced stage regarding invoices that were submitted prior to termination of the contract. There are some things we find agreeable in the invoices, but there are also areas we are disputing.
“I cannot reveal much because we are still negotiating and after everything we will hold a press conference to share an update.”
At the time of terminating the contract last October, Nyirenda said the decision was based on a contractual clause of convenience and public interest which allowed him to discontinue the contract at no cost.
On why government was now negotiating payments for the same contract, he said the discussions are focused on invoices submitted before termination and not breach of contract.
Nyirenda could also not commit if resuming the contract with Techno Brain was another option on the table. He said what was exciting was that the termination alone will enable government to save over $25 million (about K25 billion).
He said: “When we make decisions to terminate contracts the aim is to save as we said that the contract was expensive and was not benefiting Malawians.
“And the contract with Techno Brain stands terminated. But in terms of substantive matters under discussion, I cannot share more.”
Techno Brain has not responded to our inquiry sent through both e-mail and WhatsApp.
Immigration Department national spokesperson Wellington Chiponde yesterday declined to comment, saying all matters relating to the contract were being handled by the Attorney General.
Secretary to the Treasury McDonald Mafuta Mwale also said the matter is being handled by the Attorney General who will advise on the wayforward.
In January this year, Techno Brain issued a statement asking for a continuation/resumption of the terminated contract. It argued that the proposal was a win-win situation for Malawi as the firm had laid an important foundation for the passport system in Malawi, including training of staff.
In an earlier interview, Nyirenda indicated that there were at least eight bidders for the new passport tender. He said they included locals and that preference would be given to them.
In May this year, Minister of Homeland Security Jean Sendeza stated that the next passport deal will be lower in cost and eventually lead to a reduction in passport fees in line with the Tonse Alliance campaign promise.
Among the many promises in the campaign for the court-sanctioned Fresh Presidential Election on June 23 2020, the Tonse Alliance said passport fees would be reduced to K14 000. But two years after the alliance got into power, a 36-page passport still costs K90 000 while a 48-page one is at K130 000.
The passports contract was signed in March 2019 by the Democratic Progressive Party administration and required Techno Brain Global FZE of United Arab Emirates to upgrade the country’s passport issuance system.
The deal also involved the introduction of an electronic passport under the build, operate and transfer model by providing 800 000 electronic passports under procurement reference number IM/01/272/07.
Details emerged that for every passport booklet issued, Malawians get a raw deal as the government made a profit of between K30 000 and K117 000, largely due to overpricing.
Documentation shows that a supplier of passport booklets from Vienna, Austria, pegged the average unit cost of a booklet at $9.13 and from Singapore, the cost is around $1.73.
The supplier, then sells each booklet to the government at $76, including supply of 1 600 units of ink ribbons and 1 600 crystagrams, a series of holographic images,required for the printing of e-passport booklets.