Government would this week not deny that they paid Sinohydro about P200 million pula more than the going rate for the construction of the Kang ÔÇô Hukuntshi road under questionable circumstances.
Sunday Standard investigations can reveal that the extra P200 million, which was paid to Sinohydro is more than half what the government is spending to sponsor 10 000 students into tertiary institutions for the 2010 academic year.
Department of Roads Director Kabo Kote confirmed reports by industry experts that at the current standard rate, the Kang-Hukuntshi road, which cost government P 536 million should not have cost more than P300 million.
Kote told Sunday Standard that, “when we awarded the project, the price of fuel was at its highest and the cost of material was also at its highest because of the construction in South Africa for the 2010 World Cup.”
Kote, however, could not explain why the price was not revised downwards when the price of petrol dropped and the World Cup construction was completed.
Pressed further, Kote explained that “the problem is that we have not built local capacity, so citizen contractors can not compete for mega projects. There is always a danger of international cartels colluding to inflate prices.”
He says the situation is further complicated when the contractor and the consultant are seen to be in an incestuous relationship.
Kote is believed to be referring to the questionable relationship between Sinohydro and Bothakga Barrow-Binnie who are consulting engineers for the project.
Although Bothakga Barrow-Binnie is supposed to be representing government interests in the project, it has since emerged that the consulting engineers have a business relationship with Sinohydro.
It is understood that Sinohydro has leased equipment for the project from Diretlwa, a sister company of Bothakga Barrow-Binnie.
Roads Department has since declared a dispute with Bothakga Barrow-Binnie over the apparent conflict of interest and the issue is slated to go for arbitration.
Quizzed on the issue, Director of Roads Department, Kabo Kote, said, “There are some contractual issues between us and the consultants concerning their supervision of the project.” Kote, however, would not go into details, referring all queries to the Permanent Secretary Mabua Mabua.
The Permanent Secretary was out of town at the time of going to press. Bothakga Burrow Binnie was not involved in the pricing of the project. The consultants only came in after the tender was awarded to Sinohydro.
Sinohydro Business Manager, Ren Chaofeng, would not comment on the overprising of the Kang-Hukuntshi project and instead deferred to the Roads Department. The controversy over the Kang-Hukuntshi project is believed to be an example of a pattern of poor supervision of government construction projects.
The Roads Department has engaged a British firm of consultants to audit all its projects.The Roads Department in Botswana’s biggest spender and the planned audit of its projects is expected to reveal embarrassingly poor oversight of the billions of dollars the department has paid to contractors and consulting engineers.
The Directorate on Corruption and Economic Crime has also mounted an investigation on some of the project and the deputy Director of Roads Department has been suspended pending the investigations. Kote would “neither deny nor confirm” the reports and referred all questions on the British audit firm and the DCEC to the Permanent Secretary.
The Sinohydro Kang-Hukuntshi project, which is already running behind schedule has been dogged by allegations of impropriety. The Chinese contractor was recently dragged before the land tribunal by a quarry over who suggested possible corruption in the way Sinohydro was awarded a quarry site in Kang.
The company, which is involved in construction projects running into billions of Pula, has, however, been experiencing performance nightmares. Some of its major projects, The Airport expansion, the Ramokgwebana-Francistown road and the Dikgatong dam construction projects are also running behind schedule, sparking complaints that the Chinese company should be blacklisted.
In an earlier interview with the Sunday Standard, Sinohydro Business Manager Ren Chaofeng said blacklisting non performing companies would be counter productive because companies like his, with skills and that are cheaper, would be driven out of the market leaving expensive companies that government can not afford.
Before a decision to blacklist a company is reached, he suggested that an assessment be made to see if there were valid reasons for the delays. In a subsequent interview this week, Chaofeng said his company was involved in a campaign to train citizens. “This year we have trained 100 workers through a BOTA accredited course and we intend to increase the number to 200 next year,” he said.
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