Sunday, September 27, 2020

Millions disappear mysteriously at MMEWR

The tender for the construction of the P28.8 million Department of Geological Surveys Headquarters at Lobatse, which was awarded under controversial circumstances, missed the deadline by three years with government incurring millions in cost overruns.

It had been proposed that the project be completed within a period of 72 calendar weeks commencing April, 2004 to August, 2005.

Apparently, the tender was given to a contractor whose capacity to complete the project on time was suspect, since he was already engaged in another even bigger Government project to the tune of P205 million. There was concern that his resources were likely to be overstretched.

In his Report on the Accounts of the Botswana Government for the Financial Year Ended 31 March, 2008 the Auditor General showed that as it turned out, the contractor failed to complete the project on the scheduled date. Further mention is made of the fact that several extensions of time granted by the employer could not make a difference in the performance of the contractor.

Elaborating on some of the indicators, which in the final analysis vindicated those who had advised against awarding the tender to that particular company, the Auditor General cited examples, for example, “materials not delivered on time, failure to communicate timeously with the employer regarding progress, as well as late appointment of Mechanical sub-contractor”.
Following protracted delays, the Department is reported to have sought the intervention of the Public Procurement and Assets Disposal Board (PPADB) who, in turn, granted authority to terminate the contract.

Surprisingly though, after the PPDAB’s advice to part ways with the contractor, the Department then somersaulted on their own initiative to involve the Government’s tender awarding body, and took a decision to invoke the penalty clause in the agreement between Government and the Contractor thus leaving the contract to continue.

In terms of the agreement, failure to complete the works within the agreed period would attract liquidated and ascertained damages in the sum of P7 865.90 per day during the period of default.

Although authority was granted to terminate the contract in early stages when things showed a dubious pattern, especially regarding the prospects of the contractor to deliver given his existing commitments, it remains a mystery as to why the authorities opted to insist that the contractor, whose name has not been divulged, continue doing the work.

However, it emerges that the contractor was consequently charged, liquidated and ascertained damages to the tune of P2 871 055, which was reportedly deducted from subsequent certificates.

Furthermore, it was also noted as a requirement that works would be comprehensively insured against fire and other hazards for the whole duration of the contract up to seven days after completion.

Notwithstanding this provision in the agreement, the auditors stated that for the whole time from September 2005, which was already a month beyond the initial contract period, up to February 2008, the project was under serious risk as it was uninsured. This, the Auditor General argued, was anomalous and a breach of the contract.

As a result, the final project cost was P34 704 832 reflecting an overrun of P5 994 277, and a time overrun of two and half years.

Information passed to the Sunday Standard reveals that efforts by the Office of the Auditor General to get the anomalies accounted for by the Permanent Secretary at the Ministry of Energy and Water Resources (MMEWR), who happens to be the Accounting Officer of the Ministry, drew blanks.

Meanwhile, the Auditor General further pointed out in his report, that in August 2008, he wrote to the Accounting Officer and sought explanations on certain matters relating to the contractors retention deposits accounts which he indicated were reflected in the year- end analysis, without success.

He said, “I asked to be advised of the circumstances under which large amounts totaling P7 779 991, involving 21 contractors, had been transferred to the Consolidated Fund, and not claimed by the contractors as well as his comments on the debits which totaled P702 635.”

In addition, yet another amount, to the tune of P3 262 692, was still to be accounted for, whilst the Ministry was nowhere closer to reconciling the balance of P22 927 176 which appeared in the analysis to the P19 263 009.

The State auditors maintain that to this date they await comments from the PS on analysis and other critical comments they have submitted to his office concerning millions of pula, which have been drawn from Government’s accounts.

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Sunday Standard September 27 – 3 October

Digital copy of Sunday Standard issue of September 27 - 3 October, 2020.