Finance Minister, Dr Abdul Hafeez Shaikh has slashed the cost of "Safe City Project" already in Supreme Court, by about $27 million from $151.151 million to $124.9 million.
Official documents reveal that when the project, which is under litigation, was placed before the Executive Committee of the National Economic Council (ECNEC) on July 29, 2011, issues of transparency, cost effectiveness, compatibility of technology with the existing system and quality of technology being sought were raised. Details of case pending in the Supreme Court were also placed before the ECNEC.
However, the officials who are dealing with the project, stated that the committees constituted by the government at various levels have exhaustively examined the project. The cost of the project was also considered and after due deliberation prices of project items were reduced by 30 percent.
ECNEC was further apprised that this was the best technology available in China and it is compatible with the existing system. It was also stated that no doubt a case is pending with the Supreme Court of Pakistan, but no stay order has been granted on this account. One view was that since the issue is sub judice therefore, till outcome of the case the matter may be deferred. The other view was that all technical and financial issues related to the projects were thoroughly deliberated at different fora/meetings and having sorted them out the project awaits approval.
It was also argued that any further delay may cause cost escalation, besides objective of the project to provide due security to the people of the capital would be compromised. Nevertheless, there was unanimity of opinion that the project sponsors may initiate due process, however, the project would only be finalised subject to the outcome of the pending litigation. It, was , however, noted that the court proceeding and its decisions shall be honoured and implemented.
ECNEC was informed that the project envisages implementation of physical infrastructure and allied facilities to prevent citizens and their properties from security threats and terrorism attacks. The project is initially planned to be implemented in Islamabad. The project will create an effective and adequate security framework in Islamabad by incorporating strategies preventing unauthorised access of vehicles and individuals entering or operating within the Capital Territory.
The project will also strengthen the law enforcement agencies by utilising state of the art technologies including, but not limited to cameras, integration of multiple national databases of vehicles and individuals with centralised control rooms to monitor and control situations for prevention of incidents. Moreover, the project will introduce a prudent monitoring and surveillance system to monitor/record the movement of unauthorised vehicles and persons.
It was further revealed that the scope of the project will be achieved by: (i) establishing emergency command centre in Islamabad to report, identify, control and manage any incident or disaster by efficiently making use of limited resources;(ii) using Smart ID cards, Electronic RFID tags, Smart Vehicle Registration Cards and Smart 'Driver Licences for authentication of vehicles and individuals;(iii) installing CCTV cameras and RFID tag readers at key points across the city to provide an effective monitoring and control system; and (iv) providing handheld/portable readers for authentication of vehicles registration cards, driving licenses and subsequently smart ID cards.
It was further intimated that RFID tag readers and electronic access control hardware, ie turnstiles, barriers and blockers will be placed at key access points of designated areas or buildings to provide an effective access control system.
ECNEC was also informed that the project, at a cost of $124.79 million (equivalent to Pak Rs 10.725 billion) was, initially considered by the CDWP in its meeting held on 19 November 2009. CDWP, while approving the project in principle to enable the sponsors to negotiate loan 'facility, constituted a committee, headed by Member (S&T) to evaluate suitability, quality, quantity and adoptability of the proposed technology/equipment and financing and other requirements of the project.
The committee, in its meeting held on 19 December 2009, discussed the project and took a number of decisions, including the following: (a) Ministry of Interior should submit a summary to the prime minister for seeking decision regarding sponsoring and execution of the project as the prime minister had already directed the Ministry of Information Technology for execution of a similar project in 10-12 cities; (b) procurements for the project should be made in accordance with the Public Procurement Rules 2004; (c) in case of tied loan, competitive bidding between Chinese companies for the loan amount and for local component competitive bidding within Pakistan should be adopted and; (iv) feasibility study of the project should be undertaken. Subsequently, the prime minister, in a meeting held on 13 March 2009, constituted another committee under the Deputy Chairman, Planning Commission to look into the possibility of integration and rationalisation of both the projects. The committee formed a technical committee to carry out a complete analysis of the Safe City Project. The technical committee estimated an indicative project cost of $78 million as the equipment was of proprietary nature and detailed specifications were not available.
The recommendations of the technical committee were submitted to the prime minister on 15 April 2010 by the Deputy Chairman, Planning Commission. Simultaneously, the Ministry of Interior also submitted a summary on 7 June 2010 the prime minister seeking his approval to the following: (i) permission for direct contracting with M/s Huawei Technology Co in terms of rule 42(c)(v) read with rule 2 (g) of Public Procurement Rules 2004; and (ii) authorising Planning Commission and Finance Division to assess price reasonability and negotiations with M/s Huawei Technology Co.
Prime Minister approved the proposals of the Ministry of Interior on July 2010. Based on that approval, Ministry of Interior requested the Planning and Development Division to nominate a representative for negotiations with M/s Huawei Technology Co for assessing the price reasonability. The request was declined on February 2011 on the grounds that the Planning Commission could not be involved in negotiations with suppliers as it was against its role of appraiser and approver of the projects.
Ministry of Interior submitted a revised PC-I of the project on 05 March 2011 at a cost of $151.151 million, after incorporating some of the recommendations of the Planning Commission. ECNEC also apprised that a constitutional petition, under Article 184(3) of the Constitution, was filed in the Supreme Court of Pakistan in March 2011, on the grounds that the Safe City Project breached the fundamental rights of doing business as enshrined in Article 18 and disregarded transparency. Planning Commission filed its comments in the Supreme Court on 25 March 2011. Thus, the matter is still sub judice.
ECNEC was further informed that the revised PC-I, costing $151.151 million was considered by CDWP in its meeting held on 7th April, 2011. The CDWP recommended the project for approval of ECNEC subject to following: (i) Price Reasonability Assessment by a committee headed by Secretary Finance, including Secretary Ministry of Information Technology, Chairman NTC and Chairman Nadra along with BOQs/ detailed specifications as early as possible;(ii) Ministry of Interior and Nadra to sort out the technical observations with Planning Commission within a period of three weeks; and (iii) the modified PC-I, after incorporating all observations raised on the project, will be submitted by Interior Division to Planning Commission before submission of summary to ECNEC.
It was intimated that in compliance with the CDWP decision, the Price Reasonability Assessment Committee, after assessing price of some items and discounts given by the solution provider, reduced the total price of the project from $151.151 million to $124.9 million. Consequently, the Planning Commission, Planning & Development Division has submitted the project for consideration of the ECNEC.
During ensuing discussion, the issues of transparency cost effectiveness, compatibility of the technology with existing system and quality of the technology being sought were raised. Responding to the queries it was stated that committees constituted by the government at various levels have exhaustively examined this project.
The cost of the project was also considered and after due deliberation prices of project items were reduced by 30 percent. Since this project has been envisaged to provide security to the people of the Capital city, therefore, its cost effectiveness cannot be quantified, but surely it will contribute to existing security arrangements. The ECNEC approved the project and directed that cost recovery mechanism be formulated to ensure sustainability of the project.
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