A number of serious violations have been committed by Port Qasim Authority (PQA) in the procurement process for the award of channel maintenance dredging works 2009-10. Transparency International Pakistan (TIP) has pointed to these violations in several letters, sent since the beginning of January 2010 to PQA Chairman, indicating mis-procurement by PQA, causing loss of Rs 87 million.
TIP Chairman Syed Adil Gilani in his latest letter sent on January 30 to Vice-Admiral, (Retd) M.Asad Qureshi, Chairman, PQA, has detailed the violations in this procurement "which may render the whole process as mis-procurement under Rule No 50" as below:
-- The tender of capital dredging, deepening and widening of channel has not been discharged, and maintenance dredging tenders were invited, which is an unauthorised breach of Public Procurement Rules 2004, and is a gross violation of Rule No 33 and 34, as a procuring agency can not re-invite tender when the original tender has not been discharged.
-- The capital dredging tender has a Bill of Quantity (BOQ) item for the first year maintenance dredging of five million cm also. That PQA requested the lowest responsive bidder to confirm their rates of one year maintenance dredging, and that they have re-confirmed that for five million cm, it is Rs 1.7 billion, which works out to Rs 1.09 billion for three million cm. PQA has awarded the contract for three million cm at Rs 1,176,903,650, which is approximately Rs 87 million higher than the lowest available tender rates of the Joint Venture of capital dredging, deepening and widening of channel.
-- The tender of Van Oord ACZ was unsigned, and as per tender documents, PQA evaluation committee declared this tender as non-responsive in its evaluation report of December 23, 2009. PQA board members committee, or as a matter of fact under PPRA Rules no one including Government of Pakistan, has any authority to change any non-responsive tender as responsive tender.
-- TIP quoted conditions from PQA procurement manual and capital dredging tender documents, as follows: Substantially non-responsive; A tender determined as substantially non-responsive will be rejected and will not subsequently be made responsive by the tenderer by correction of the non-conformity.
-- Board technical committee with board members Rajpar and Farooq did not have any role in tender evaluation report. It is the department evaluation committee which is the only forum to conduct evaluation. The evaluation report of departmental evaluation committee can not be changed by board members. PQA shall refer to PQA procurement manual approved by PQA which states that "it is agreed between PQA and TIP that the respective departmental evaluation committee shall be the grievance committee also, to examine the objections of bidders.
-- PQA reply states that "M/s. Van Oord had submitted three covering letters with the bid. In one letter they have stated that they confirm that they have read the entire tender documents and agreed with the same, whereas in the scope of work for maintenance dredging, they have stated that the dumping of dredged material at other location on instruction of the engineer will only be carried out when it has no impact on the cycle time or in case engineer gives a written instruction with an appropriate compensation in time and money for increase, or decrease of the cycle time of the trailer suction hopper dredger.
-- They have also not stamped and signed each and every page of the tender documents as required by the tender conditions. This issue was discussed in detail and it was agreed that M/s. Van Oord has accepted all terms and conditions of tender vide their covering letter of December 20, 2009 which superseded their other covering letter of December 15, 2009, hence the financial proposal of M/s. Van Oord may be opened."
-- This statement of PQA grievance committee (illegal according to PQA rules) headed by Farooq Hadi Rahimtolla, becomes doubtful when Director General (Technical) wrote a letter to Van Oord on December 24, 2009 in which PQA had asked it to confirm ie "You have put in certain qualifications with the tender proposal, which are in contradiction with the tender provisions. You are, therefore, advised to clarify that you agree with the provisions contained in the tender documents issued to you."
-- The other point noticed from documents supplied with the PQA reply is that the two letters of Van Oord, ie of December 20 and December 15 are different, signed by the same person Dik Viot, who is designated as Desk Manager in December 20 letter and as D.Viot, Area Co-ordinator, South West Asia in December 15 letter. The signatures of the same person in the two letters are also different. In presence of the availability of Van Oord letter, why PQA needed further confirmations on December 24, 2009?
-- PQA has violated Rule No: 35, which is mandatory on PQA to give evaluation report to bidders 10 days before the award of tender, as PQA has stated that it has declared the evaluation report on their website on January 7, 2010 and awarded the contract to Van Oord by issuing Letter of Intent (which is award of contract) on January 6, 2010.
TIP Chairman Syed Adil Gilani in the end said that PQA can not pick and chose in processing tenders in the presence of PPRA Rules and approved PQA procurement manual. This is a procurement which has to be reviewed in the light of above, he said. Copies of the letter have been sent to: Finance Minister; Chairman, Public Accounts Committee, National Assembly; Auditor General of Pakistan; Chairman, NAB; and Managing Director, PPRA.