Transparency International Pakistan (TIP), which is endeavouring hard to ensure 'zero tolerance' on corruption and procurement, has come out hard on Port Qasim Authority's clarification with regard to the alleged "misprocurement by PQA, causing loss of Rs 87 million Channel Maintenance Dredging Works 2009-2010, " highlighted by TIP in its letter sent to Vice-Admiral Asad Qureshi (Retd) Chairman, PQA, last month.
Syed Adil Gilani, Chairman, in his letter sent on February 6 said although TIP and PQA have signed MOU to vet procurements on the request of PQA, TIP has also been monitoring all procurements in Pakistan for compliance of the Public Procurement Rules, across the board, for last 4 years, and all violations are brought to notice of authorities.
Disputing PQA'a reply of February 2, he said it is not based on facts and needs to be corrected. TIP and PPRA have to be informed on the following acts of PQA, which have not been clarified.
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 Rues 2004. It is 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. PQA has not denied the fact that two tenders for the same work were invited, which is against the PPRA Rules.
PQA had stated that "as far as Capital Dredging project is concerned, this technical matter can only he understood by those having requisite know-how to understand the distinction between maintenance and capital dredging works.
TIP contended that PQA cannot consider the unsolicited offer of Dredging international, as per PPRA Rules, for award of maintenance dredging work to them; particularly when it was submitted after opening and evaluation of financial bids. How could TIP even recommend such a course of action?".
TIP clarified that the Capital dredging Tender has a Bill of Quality (BOQ) item for the two year maintenance dredging of 10 million cm also. But in the current maintenance tender PQA has invited tenders for 1 year, and for quantity 3 MCM. Every one with common sense can understand this issue. TIP is not supporting the bid of complainant, but stating that PQA can not award contract to any of the three bidders under the PPRA Rules, as the Capital dredging tender is not vet discharged. PQA should end and understand the objections before replying.
TI Pakistan further clarified that when PQA Chairman requested TIP verbally to vet the current maintenance tender, TI Pakistan refused the request of the Chairman not on the ground that TIP is very busy, but categorically informed him either to discharge the Capital Dredging Tender, as inviting maintenance tender in presence of operative capital degrading tender where annual maintenance dredging is a BOQ item, is against he PPRA Rules, and if PQA does not discharge the first tender of Deepening, TI Pakistan should not be sent the maintenance tender documents for vetting, as TIP will comment on the tender process as illegal under rules. Inviting this tender therefore is a serious violation of Rules No 33 and 34.
The current issue is vetting by TIP, but handling a complaint by a bidder (who is also under FIA inquiry for past 3 years annual channel degrading maintenance contracts as slated by PQA and CCP) received by TIP is also necessary.
Tender of M/s Van Oord was unsigned, and as per term given in the tender documents, PQA Evaluation Committee correctly declared this tender as non-responsive in its evaluation report dated December 23, 2009. PQA Board Members Committee or as a matter of fact under PPRA Rules no one including GoP, has any authority to change any non-responsive tender as responsive tender. When PQA Procurement Manual as well as deepening of Channel Dredging Tender states that any unsigned tender will he declared non-responsive, and the PQA Evaluation Committee declared Von Oord tender which was unsigned as non-responsive, under whose authority the Board Member Committee made a non responsive tender as responsive? TIP asked.
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 nonconformity. PPR 2004 also does not allow such amendments in evaluation criteria after bid opening.
Rule 30: Evaluation of bids.- (1) All bids shall be evaluated in accordance with the evaluation criteria and other terms and conditions set forth in the prescribed bidding documents. Save as provided for in clause (iv) of sub-rule (3) of rule 36 no evaluation criteria shall be used for evaluation of bids that had not been specified in the bidding documents. PQA has failed to respond to the issues pointed out by TIP which come under Rule 2(f).
The other point noticed from documents supplied with the PQA reply shows that the two letter of M/s Van Oord, letter head dated December 20, 2009, and the letter head dated December 15, 2009 are different, signed by the same person Dik Viot, who is designated as Desk Manager in December 20, 2009 letter and as D Viot, Area Co-ordinator South West Asia in December 15, 2009 letter. The signatures of the same person in the two letters are also different.
PQA has also failed to respond to the following issue pointed out by TIP.
PQA has violated (Rule No 35, which is mandatory on PQA to give evaluation report to bidders 10 days before award of tender. PQA has stated in its reply that it had posted the evaluation report on their website on January 7, 2010. However, PQA awarded the Contract to M/s Van Qord by issuing Letter of Intent, (which is award of contract) on January 6, 2010, one day prior to uploading the evaluation report on its website.
Responding to PQA's assertion that at least the integrity of PQA Board members, which include esteemed businessmen like Siraj Kassam Teli, Farooq Rahimtoola, Farouq Hadi, Muhammed A. Rajpar and Anjum Nisar, is above board and cannot be questioned be appreciated, TIP clarified that it has never expressed any doubts on the integrity of PQA Board members. In TIP letter it was highlighted that PQA Board Members are not allowed to be member of the PQA Evaluation Committee, as defined in the PQA Procurement Manual.
According to the letter, PQA has not replied to the following violation by PQA pointed out by TI Pakistan.
Board Technical committee with Board member Rajpar and Farooq, does not have any role in tender evaluation report. It is the Departmental 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 Manuel approved by PQA, page No 16. which states that "it is agreed between PQA and TIP that the respective Departmental Evaluation Committees shall be the Grievance committees also, to examine the objections of the bidders.
The role of PQA Board Member was compromised in the past in the famous case of tender for the Establishment of Grain and Fertiliser Terminal on BOT Basis in 2006. The Tender Evaluation Report by PQA Consultant M/s NESPAK had ranked M/s Portia/Fotco as first ranking firm and M/s Grain Bulk Handler Ltd Kenya as third ranking firm. One of the PQA Board Member, Muhammad Rajpar (who was a Board Member of PQA in. 2006, and also at present, and is a current Trustee of KPT) was the Agent of the lowest ranking bidder. M/s Grain Bulk Handler Ltd Kenya, and also headed the Evaluation Report Reviewed Committee as Head of the Board's Development Committee, on June 8, 2006. Resultantly PQA revised the Technical Evaluated rankings, and M/s Grain Bulk Handler Ltd Kenya was made first Ranking, and M/s Portia/Fotco made the lowest ranking. An inquiry was held under the direction of the Prime Minister, and based on the inquiry M/s Portia/Fotco ranking as evaluated by M/s NESAPK was reverted back as the first Ranking firm. TIP was also consulted on this issue, and besides other recommendations, TIP in its letter to PQA dated July 5 2006 had commented as under:
The other issue is of' Transparency. In the bidding process there is the Conflict of Interest of agent of one of the bidders, who participated in the bidding process as a bidder till November 2005 (actually Muhammad Rajpar wrote letter to PQA on December 19, 2005 as bidder). Later as Head of the Board's Development Committee, he dealt this project in a meeting with PQA consultant on June 8, 2006.
Ports & Shipping Ministry knows very well the provision of KPT Act 1886, Section 15B, dated 1902 for the role of Trustee, which is also be applicable to all Board Members in all public authorities under the ambit of National Accountability Ordinance 1999..
[15B. Restriction on power of trustees to vote or discuss matters in which they are interested.- A trustee shall not at any meeting of the Boa rd or a committee thereof take part in discussion of or vote on, any matter in which he has directly or indirectly by himself or his partner any share or interest such as is described in Section 15, or in which he is interested either professionally on behalf of a client or as agent for any person.
In the tenders of multibillion dollars project of Diamond Island and QICT II, which were awarded to EMAAR and DP World in 2006, TIP had informed PQA that the procurement process was not transparent. Similar is the Award of QICT Terminal II, which was tendered by PQA under the terms of QICT Implementation Agreement and in consultation with TIP, but based on a MOU signed between Ministry of Ports & Shipping with Dubai Government. The process of tenders of QICT II were suspended, which was against the provision of the Implementation Agreement of QICT, and the BOT Contract was awarded to DP World on negotiated basis.
Syed Adil Gilani said: When you as Chairman PQA held a meeting with TIP on June 15, 2006, and stated that the MoU signed between PQA and TIP did not include Build, Operate and Transfer (BOT) project, and asked TIP to disassociate with PQA on BOT project as the GoP has signed an MoU with Dubai Government, TI Pakistan vide its letter dated June 20, 2006, communicated to you that on your verbal request, TIP may not be associated with PQA for vetting of their BOT and Privatisation Projects tender documents and processes, as BOT monitoring is not part of the MoU. TIP could only advise and it is up to the procuring agencies to comply with rules. TIP also informed PQA that post-tender opening changes in the technical as well as financial terms of the contract are not allowed and all such procurement stands to be declared as misprocurement. Action need to be taken under PPR 2004 rule No 2 (f), Corrupt and Fraudulent practices if such violations become public knowledge.
Concluding TIP Chairman asked Chairman PQA to provide a copy of the contract agreement, and the final Evaluation report to TI Pakistan under Rule No 48, so that further complaints made to TIP regarding changes made by PQA, "could be examined by us".