Transparency International Pakistan is dismayed and unhappy over President of Pakistan's advice to award consultancy contract for flood rehabilitation schemes to Nespak. This is against Public Procurement Rules (PPR) 2004 and Pakistan Engineering Council (PEC) bylaws.
Transparency International Pakistan Chairman Syed Adil Gilani, in a letter sent to the Secretary General to the President, Salman Farooqui, on August 6 appealed to the President that in order to keep the donor agencies' trust in transparent utilisation of funds he should not allow anyone to violate PPR - 2004 in utilisation of these funds for flood relief, rehabilitation and reconstruction works.
He drewn his attention to the fact that "M/s Nespak had been guilty of frequently securing consultancy contracts without public tendering, against the PPR - 2004 and PEC bylaws". Gilani went on to say that at the time of earthquake in 2005, it was agreed in an international workshop, organised by Transparency International in Islamabad on February 7-8, 2006, that all procurements shall be processed under Public Procurement Regulatory Authority rules, even in NWFP and Azad Kashmir.
But Erra, with Nespak's connivance, awarded consultancy contract for rehabilitation and reconstruction works, which were not emergency works, to Nespak at cost plus basis, without public tendering, causing tens of millions of rupees extra cost to the exchequer, as well as setback to donors' trust due to non-transparent disbursement of the Erra funds.
The procurements were also objected by PPRA and Erra was not able to provide documentary record for not declaring the contract as mis-procurement under Rule No 50. PEC bye-laws 1988 are mandatory on all government bodies as well as on consultants under the PEC Act 1976, which states that: "the selection of consulting engineers is done through open and fair competition and no preference is given to any consulting engineer for reasons of his being in the public or the private sector."
Pub Procurement Rules 2004 violated by Erra ERRA in 2006 are: "4.Principles of procurements - Procuring agencies, while engaging in procurements, shall ensure that the procurements are conducted in a fair and transparent manner, the object of procurement brings value of money to the agency and the procurement process is efficient and economical.
12. Methods of advertisement - (2) All procurement opportunities over two million rupees should be advertised on the Authority's website as well as in other print media or newspapers having wide circulation. The advertisement in the newspapers shall principally appear in at least two national dailies, one in English and the other in Urdu." Gilani said that Erra projects suffered due to lack of technical capacity of Nespak, and finally in 2009 Erra had to resort to appoint specialised consultants.
Ms Yasmin Lari, Trustee of Transparency International Pakistan and also a member of Board of Erra, had been pointing out the substandard recommendations of Nespak in the board meetings, like unsuitable construction material for hilly areas, and delays in providing technical support to Erra and the contractors in time. "These actors have caused delay in completion of Erra works by 2-3 years and also caused artificial price hikes in the earthquake areas by specifying restricted material for construction. The cost in some areas increased by 300 percent due to these factors," Gilani said. Transparency International Pakistan has, therefore, requested that in the flood rehabilitation and reconstruction works, an open competition shall be held, in compliance with PPR - 2004, so that best technical proposals at the most economical cost are awarded the contracts unlike the contract mismanaged by Erra.
The work has to be divided into many Consultancies contracts viz, master plan with feasibility study, reconstruction of destroyed/damaged roads, bridges, river embankments, and barrages to sustain the highest flood level of last 100 years. Construction of houses, public buildings, ie, schools, colleges, hospitals, dispensaries, public offices, and public places. Copies of the letter have been sent to: Chairman of PAC and Federal Minister for Finance, Revenue, EA & P & D, Auditor General of Pakistan, and Managing Director, PPRA.