Trinidad and Tobago
The JCC was invited to attend the Spotlight on the Economy forum hosted by the Ministry of Finance on September 2. All present were informed that the 2022/2023 budget was going to be read by the minister on September 26 and that the country could expect it to be over $50 billion with a smaller deficit of around $2 billion. The latter was indeed good news.
The JCC however warned the public earlier this year that we were about to have yet another budget read without procurement reform via legislation that has undergone all due processes, including three sets of amendments, since 2015.
The current situation, as far as the public has been informed, is that the Attorney General told Parliament on June 22 that, inter alia, comments from the Chief Justice (that he the AG solicited), were “traffic stopping” – meaning that the Government could not proceed at that time with full operationalisation but that the Ministry of Attorney General and Legal Affairs was addressing all “outstanding” matters with the assistance of the Office of Procurement Regulation (OPR).
During the question and answer period, the JCC therefore posed the following question to the Prime Minister: “Based on the understanding that procurement reform has the potential to save this country billions of taxpayers’ dollars, what is the Government’s revised target date for full operationalisation of the procurement legislation?”
The Prime Minister’s response was equally astounding and disappointing. First he indicated that he did not agree that procurement reform has the potential to save TT billions of dollars. For this, he relied on his recent discussions with the Jamaican Prime Minister, in which the latter indicated that in the Jamaica experience, it led to higher costs and more delays in the sphere of smalle-scale procurement.
The JCC can find no evidence for this statement but cautions Dr Rowley that we should be comparing ourselves to more developed countries if we aspire to achieve significant improvement in our systems. Rowley then repeated his previously made public comment that procurement reform was not a panacea for curing corruption.
No stakeholder has ever claimed that procurement legislation, when operationalised, would be a magic wand to change corruption associated with public spending. Operationalisation of the legislation would simply facilitate real oversight by an independent body, the OPR that is now ably equipped with the human and technological resources to execute its primary function under the Public Procurement and Property Disposal Act.
Everyone understands that the process of change will continue to be slow before the country realises the benefit of reduced corruption through increased efficiency, independent oversight and transparency.
Rowley of all people understands that good behaviour around public money has to be legislated while transgressions require heavy enforceable penalties to act as a deterrent. Or, as Martin Luther King Jr put it, “Morality cannot be legislated, but behaviour can be regulated. Judicial decrees may not change the heart, but they can restrain the heartless.”
We therefore implore our Prime Minister to stop sending mixed signals to his ministers and the public service entities that continue to spend public money with impunity. We need the law fully operationalised to grapple as a society with restraining the heartless few taking unfair advantages in the realm of public procurement.
After responding as described above, Rowley closed his response by stating that, yes, he wants the procurement legislation passed but some work is required, but it will be done. The question of a final deadline was not given by the prime minister.
After seven years of the previous regime passing the parent act in 2015, this response is simply unacceptable from the person with maximum power and ultimate responsibility in TT. According to the regulator, Moonilal Lalchan, “proper procurement practices could save this country a conservative $5.2 billion a year – otherwise lost to corruption or inefficiency” (Feb 7, 2020).
The JCC again calls on the prime minister to get involved in the details of the outstanding matters with the AG, that he referred to as “some work,” so that he can properly advise the public of a final date for the full operationalisation of the procurement legislation.
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Guyana
Former Auditor General Anand Goolsarran says the Ministry of Education, the national tender board and Cabinet all failed in their duty to the public by not acting to stop Kares Engineering Inc from securing a $566.9m North Ruimveldt Secondary School contract considering its previous poor performance on an even larger project.
In his accountability column in today’s Stabroek News, Goolsarran said that after the Evaluation Committee of the National Procurement and Tender Administration Board (NPTAB) had concluded its work and recommended Kares, the procuring agency – the Ministry of Education had an obligation to take account of Kares’ disastrous work on the $728m Kato Secondary School project of 2012.
Goolsarran said that Section 5 of the Procurement Act sets out the responsibilities of the procuring entity – the Ministry of Education – in relation to the criteria to be used in determining the qualifications of contractors and suppliers.
“Included in the list of criteria is the requirement that past performance substantiated by documentary evidence would commend the concerned contractor or supplier for serious consideration for the award of the contract. The Ministry of Education therefore had the obligation of ensuring that Kares Engineering met this criterion before consideration of its tender”, Goolsarran contended.
He pointed out that the Ministry had the power to reject the recommendation of the NPTAB’s Evaluation Committee. He said that if the procuring entity does not agree with the Evaluation Committee’s determination, it must issue an advisory recommendation to the Committee regarding which tender should be the lowest evaluated tender, “which recommendation the Evaluation Committee must observe”.
Goolsarran concluded “…the first line of action as it relates to Kares Engineering was for the Ministry of Education to disqualify the company on the basis of unsatisfactory performance in the past. Kares Engineering’s tender should have been deemed unresponsive and excluded from the technical evaluation”.
The ministry did nothing of this sort. After the matter of Kares’ poor performance on the Kato project was raised by Stabroek News, Minister of Education Priya Manickchand was contacted for a response. Manickchand, under whose tenure the construction of the Kato Secondary School commenced in 2013, said “it is hard to forget the issues with Kato Secondary School and we must ensure that we hold contractors liable when these things happen.”
She told Stabroek News that the Ministry is hoping that there is a reenergized, reinvigorated and robust effort to monitor projects to ensure that there is both quality and timely completion. She explained that a contract for the supervision of the project was awarded to consultant Marcel Gaskin – who also designed the school.
“We are already clear about what we wanted from the contractors not because we knew Kares was going to have the contract, we did not know that at the time, but it is a big enough undertaking and an important enough undertaking for us to finish in a timely manner and that is why we went in that direction [to have a supervisory consultant].
“The truth is we are going to have to rely on people’s professionalism and commitment to service. Once we have professionals hired to do jobs and Marcel is a professional, Kares are professionals and I was very clear (at the contract signing) that we would have no hesitation in applying penalties such as liquidated damages as per the contract if there is any breach of the contract,” Manickchand related.
The minister added that she did not have a discussion with Kares Engineering, prior to the signing of the contract and would not be doing so. She explained that she does not meet with contractors behind closed doors.
“I didn’t sit down personally with Kares. A contract was signed with Kares and publicly from the podium over a mic in the presence of an entire press corps I said what was expected and what would happen if those expectations were not met pursuant to the contract, not pursuant to my whim and fancies,” she said.
Manickchand added that the Ministry will also have its own engineer and Education Officer to report on the progress of the project.
Goolsarran also caned the NPTAB. He noted that in response to Stabroek News reports, the NPTAB defended the award of the contract, contending that its hands were tied since unsatisfactory performance was not one of the evaluation criteria.
“However, past performance is one of the qualification requirements that determines the responsiveness of tenders. NPTAB must have been aware of Kares Engineering’s unsatisfactory performance on two previous contracts and should have brought the matter to the procuring entity’s attention for appropriate action to be taken.
“NPTAB is not a passive player in the procurement process. It is responsible for exercising jurisdiction over tenders the value of which exceeds such an amount prescribed by regulations, appointing a pool of evaluators for such period as it may determine, and maintaining efficient record keeping and quality assurances systems. NPTAB comprises seven persons of ‘unquestioned integrity who have shown capacity in business, the professions, law, audit, finance and administration’, including a full-time chairperson and one other full-time person. It is also supported by a Secretariat comprising professional staff of ‘proven experience and capabilities’ and headed by the Chief Executive Officer. The current chairperson is a senior official of the Ministry of Finance responsible for … monitoring the timely execution of the Government’s public investment programme and therefore this aspect of the Act has not been adhered to”, Goolsarran asserted.
He noted that the NPTAB had further argued that the responsibility for debarring contractors and suppliers for unsatisfactory performance or fraudulent practices rests with the Public Procurement Commission (PPC) and not NPTAB. However, Goolsarran pointed out that prior to the establishment of the PPC in 2016 after a 13-year delay, the responsibility for adjudicating debarment proceedings was that of NPTAB.
“Considering that the contract for the construction of the Kato Secondary School was awarded in 2012 and the works completed in 2015, NPTAB would have been responsible for instituting debarment proceedings against the company”, Goolsarran argued.
As it relates to Cabinet, Goolsarran said that under Section 54 of the Procurement Act, all proposed contracts in excess of $15 million have to be referred to it for the grant of ‘no objection’ based on a streamlined evaluation report setting out the basis for the proposed award. He noted that Cabinet can object to the award of a contract if the required procedures have not been followed. When this happens, the matter is referred to the procuring entity for further review.
“The Cabinet should have objected to the award of the contract to Kares Engineering on the ground that the Ministry of Education failed to adhere to the requirements of Section 5 of the Act dealing with qualifications of contractors and suppliers”, Goolsarran declared.
He also observed that upon the establishment of the PPC, Cabinet’s involvement was to have been progressively phased out in favour of a decentralized system. Further, he pointed out that sub-section 6 states that the Cabinet’s involvement shall cease upon the constitution of the PPC. The first PPC was established on 28 October 2016 but Goolsarran said that there is no evidence that the Cabinet has given up its role in the procurement process.
Goolsarran also noted that in defending its decision in response to an editorial in Stabroek News, the NPTAB had argued that Kares’ bid was the lowest responsive one as two others had failed to meet evaluation criteria. Goolsarran however contended that it was not the lowest responsive tender that would have to be considered but the lowest evaluated tender. The NPTAB statement in response to the Stabroek News editorial did not refer to the lowest evaluated bid.
PPP/C governments have come under close scrutiny over procurement awards over concerns that companies close to them are favoured.
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Trinidad and Tobago
In a recent newspaper article, Afra Raymond raised a number of issues, some of them constitutional, on what, to me, is the increasingly strange case of public procurement legislation.
He wondered about the delay in finalising the legislation, seeing that “all the legal and necessary steps have been taken”.
I, too, wonder—after all, the law was passed in the People’s Partnership administration in 2015, seven years ago. I am by no means as familiar with the legislation as is Mr Raymond, but I recall an amendment to the original which, as a citizen, I consider totally unacceptable.
The amendment—whatever the hymns to transparency and accountability we always hear lustily sung by political choirs—excludes government-to-government contracts from scrutiny by the Procurement Regulator’s Office.
Such contracts and agreements have, in the past, caused this country no end of trouble and financial loss. If a cloak of secrecy is again to be thrown over them, while taxpayers’ money is being spent on them, I may, as a citizen, have to examine my options.
In the meantime, I strongly recommend to the Government a close reading of the March 1982 report by the late Lennox Ballah on government-to-government arrangements.
Mr Raymond also wonders why our Attorney General invited our Chief Justice “to comment on the implementation of the new law”. He goes on: “That is a most unusual request since it runs the risk of eliciting a comment from the Judiciary on matters which are likely to come to that institution for its rulings.”
I, too, find the AG’s request odd. Would he please be so good as to tell us what really inspired him to make it? Further, is it correct that he has delayed action towards implementation of the law because of the CJ’s views?
Is this normal separation-of-powers behaviour? Or is there something more in the mortar than the pestle we think we see? Also, when will the AG publish the CJ’s letter (unredacted, of course), as he publicly promised to do?
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Guyana
As questions continue to swirl in relation to the award of the $566.9 million contract to Kares Engineering Inc for the reconstruction of the North Ruimveldt Secondary School, a source at the national tender board told Stabroek News yesterday that despite Kares’ disastrous work on the Kato Secondary School, their hands are tied.
The source explained that the National Procurement and Tender Adminis-tration Board (NPTAB) is responsible for overseeing the procurement process but dealing with errant contractors falls within the remit of the procuring entities and the Public Procurement Commission (PPC). The source said that the NPTAB Evaluation Committee cannot consider any complaints.
“What we do at NPTAB is overseeing the procurement process and awarding contracts. If someone objects to the award or feels aggrieved then there is a mechanism for them to address that. When it comes to contractors and (questionable performance) we cannot do anything unless it is related to us.
“What needs to happen is that the procuring entity can make a complaint to the Public Procurement Commission (PPC) and then the contractors can be debarred from bidding for government contracts. Also where companies have been debarred by international bodies, the Public Procurement Commission can also do something called sympathetic debarment and they would be unable to bid. So it is not the NPTAB’s job to debar any contractors, we can only prevent them from bidding after the Public Procurement Commission debars them and that has been communicated to us,” Stabroek News’ source explained.
The source further explained that once the complaint is lodged then it is up to the PPC to determine the nature of the debarment and the timeframe.
“What we do is that we check the debarment register and if you are not on it then we can’t say to a bidder that you can’t bid. If you are on the register then automatically your bid will be disqualified and we do not disqualify you at the opening [of the bids]. When the evaluators come in, the Secretariat will inform them that this person has been debarred and they will check the register to verify that and to see if the period of debarment has expired,” the source said.
The bids for the reconstruction of the school were opened on June 23, 2022. Some nine companies were on record as having submitted bids for the project which is estimated to cost $622,375,321. The $566.9M contract was signed on August 24.
Back in 2012, Kares Engineering was awarded the $728 million contract for the construction of a new secondary school at Kato in Region Eight (Potaro-Siparuni). The new school was constructed to ease overcrowding at Paramakatoi Secondary.
The school was not occupied for a long period after it was found to be riddled with major defects after construction ended in 2015. An audit by Rodrigues Architects Limited subsequently found that the building was unsafe for children and that at least $144 million would be required to fix the defects. Kares was subsequently allowed to complete all corrective works on the school, at no cost to the government, under the supervision of Vikab Engineering, which was selected to oversee the works at a cost of $29.2 million.
The school was officially commissioned in March of 2019 – some 7 years after work started.
As it relates to Kato Secondary, Education Minister Priya Manickchand said that when the APNU+AFC government took office in 2015, the project was in its defects/liability period but no action was taken. Then President David Granger had indicated that Kares would no longer be receiving government contracts.
Back in 2016, Kares Engineering Director Radesh Rameshwar had defended the allegations against his company. In a letter to the press, he said that the school was completed within budget and built within specifications as established by the Government of Guyana.
Evaluation of Kares’ bid
According to the NPTAB’s website the following bids were received for the reconstruction of the North Ruimveldt Secondary School – Platinum Investments Inc $679,122,111; Dry Rock Construction Inc $687,163,051; QCD Con-struction Inc $521,690,454; M&P Investment $606,636,675; S&K Construction Consul-tancy Service & General Supply $595,000,000; Dundas Construction Inc $ 620,000,000; CB General Contracting Service Inc $531,787,715; Builders Hardware General Supply & Construction $614,853,630 and Kares Engineering Inc $566,975,350.
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Guyana
The award of the contract in the sum of $566.9 million to Kares Engineering Inc. for reconstruction of the North Ruimveldt Secondary School has generated much criticism. The company was the third lowest from among nine tenders received. According to the National Procurement and Tender Administration Board (NPTAB), the two lower tenders were deemed non-responsive, making Kares Engineering the lowest responsive tender. However, by Section 39(2) of the Procurement Act, a procurement contract must be awarded to the lowest evaluated tender and not lowest responsive tender.
Lowest evaluated tender versus lowest responsive tender
The Act does not provide a definition as to what constitutes the lowest evaluated tender. However, following the bid opening ceremony, the procuring entity (Ministry, Department or Region) must transmit to the appointed Evaluation Committee all tenders received from contractors or suppliers. The Committee shall evaluate the tenders using only those criteria outlined in the tender documents, which have to be qualified in monetary terms, in addition to prices.
Evaluators normally use a two-step approach when conducting evaluations, and this approach is supported by the Procurement Act. The first is an assessment of the responsiveness of the tenders which is a non-technical evaluation. This involves checking to ensure that all the documents listed in the solicitation request have been included in the tender submission, in addition to assessing whether the tenderers have met the qualification requirements set out in Section 5 of the Act. The latter includes ensuring that:
Obligations to pay taxes and social security contributions of employees have been fulfilled;
There is no disqualification, debarment or suspension over the last three years in Guyana and elsewhere;
A tender is still considered responsive if ‘it contains minor deviations that do not materially alter or depart from the characteristics, terms, conditions and other requirements set forth in the solicitation documents or if it contains errors or oversights that are capable of being corrected without touching on the substance of the tender’.
As Quantity Surveyor, Donald Rodney pointed out in a recent letter to the Editor:
Responsiveness refers to deliverables, being documentation NPTAB expressly requires of all intended bidders. The responsiveness test is best seen by readers as a procedural pre-evaluation review of submitted bids to screen out bids which do not have the deliverables required, carried out to facilitate the speedy execution of substantial evaluation of bids…The responsiveness test should be done on a fail or pass basis, with ‘failed bids’ being set aside and taking no part in the substantive evaluation, whatsoever.
In the second stage, the evaluators proceed with the technical evaluation of only tenders that are considered responsive. This involves assessment against the criteria set out in the tender documents which have to be quantified in monetary terms using a combination of points and weightings, including prices. A key criterion relates to the possession of, or having access to, the technical competence, financial resources, equipment and other physical facilities, managerial capability, reliability, experience, and reputation, and the personnel, to perform the contract. The tender that receives the highest score based on the technical evaluation is considered the lowest evaluated tender.
There is legal capacity to enter into the contract;
There is no evidence of insolvency, receivership or bankruptcy etc.;
Directors or officers have not been convicted of any criminal offence relating to professional conduct or the making of false statements or misrepresentations as to qualifications to enter into a procurement contract within a period of ten years preceding the commencement of the procurement proceedings; and
Past performance substantiated by documentary evidence would commend the tenderers for serious consideration for the award of the contract.
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