LAHORE: Lahore Waste Management Company Chairman (LWMC) Malik Amjad Ali Noon has claimed that the contracts with foreign companies (Albayrak and Ozpak) have caused huge financial loses to the government and it may initiate the process of black listing them.
He revealed that the contracts delivered over payments to the international contractors by allowing higher import duties which resulted into losses of Rs236.735 million to the LWMC.
In a statement issued here on Monday, he said that the contracts were ill conceived in the first place; “These were poorly designed contracts that stipulate the procurement of services at inflated rates favoring the international contractors”.
“Additional terms and conditions were also cleverly designed to suit persons of choice. The bidding process itself was rigged by non-transparency of prequalification. Even the 2011 issuance of the tender documents to the international contractors were without the approval of the Board of the Directors,” he said.
According to him, the internal findings of the forensic report also indicate misappropriation of the accounts. Whereas inflated guaranteed waste was incorporated in the contracts (4700 tons per day) whereas in the year 2020 per day reported claimed waste was around 3800 tons per day. The contractors were also permitted to submit performance guarantee (US$4 million) in installments in breach of original terms and condition. Additionally Rs3 billion mobilization advance was given to the contractors whereas such a facility was not disclosed at the time of IFP (Invitation of Prequalification) for other potential bidders.
“The contracts were also sustained on inflated cost with incorrect calculations of US$2.5 million. Transfer stations that were to be built as a part of the contract were not made. Even the income tax that was to be contractually and legally paid by the contractors was passed on to the LWMC, which was against the principles of normal course of the business in Pakistan,” he added.
“During the construction of the metro, Albayrak was required to clear debris whereas it charged the LWMC more than Rs100 million for the work that was legally theirs to deliver. Similarly, the contractors collected unauthorized debris from the Orange line train and charged the LWMC more than Rs400 million. The Lahore Ring Road janitorial services contract was issued for Rs110 million and outsourced to Albayrak for Rs150 million per annum. These are a few allegations in the long list of grievances,” he said.
The Chairman LWMC said that contracts were extended multiple times and should have been if necessary extended at discounted rates, as there was no additional resources required that needed deployment.
“The LWMC Board of the Directors would be looking into charging financial claims for non-compliance of the performance of the contractors. The government might even initiate the black listing process against the contractors to safeguard other business entities and prevent their future participations for public procurement,” he added.
Copyright Business Recorder, 2021
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