PPDA EXPOSES UNRA INEPTNESS ON THE SHS55BN MPIGI RD SAGA

By Our Reporters 

The Public Procurement and Disposal of Public Assets Authority (PPDA) has issued a damning dossier on the procurement works for Busega –Mpigi Expressway. PPDA is responsible for regulation and supervision of procurement and disposal of government-owned property and other assets. In their 8^th November 2018 (addressed to the IGG, UNRA and African Development Bank the financiers of the project), PPDA accuses UNRA of trying to award the Shs555bn expressway contract to a company that is unfit.  The company (best evaluated bidder) which had been forwarded to the AfDB for approval is Ms CMS in a joint venture with a small Tanzanian firm, Advent Ltd. Advent Ltd has no background in Road construction but mainly specializes in buildings. According to PPDA report (signed by acting executive director Benson Turamye) there are several inconstancies in the procurement process including totally disregarding best practices and principles of procurement all intended to favor particular bidders. The road construction project covers a total of 63kms between Busega on the outskirts of Kampala and Mpigi along the Kampala-Masaka highway. The procurement process has been on for more than 2 years with the procedure heavily delayed by whistle-blowing and corruption allegations.

B/ROUIND TO THE PROCUREMNT DEBACLE;

The contract was first awarded to a Chinese firm China Civil Engineering Construction Corporation and China Railway 19th Bureau Group Co Ltd (CCECC & CRGC) last year. However, when the above company was submitted to the bank, a red flag was raised and UNRA was asked to answer many questions. Instead of answering the queries, UNRA nullified the bid and went into another evaluation. In the second evaluation, another Chinese firm Ghazouba Group Co. Ltd emerged as the best evaluated bidder. However, the company dropped out on realizing it had underquoted the works and that there was a likelihood of failing to complete the project. Since CMS-ADVENT joint venture had tactfully been placed in the second position on the list submitted by UNRA to the bank, it would automatically take the deal.  It is against this background that UNRA submitted CMS-Advert JV as the best evaluated amidst protests from PPDA over material deviation and several inconstancies in the submitted bid documents. PPDA had earlier raised a red flag on the procurement process but it was downplayed the UNRA Executive Director Allen Kagina in her 7^th September 2018 letter. “The civil works for the Busega-Mpigi Expressway are financed through a loan from the African Development Bank (ADB). The procurement has been characterized by unusually high number of whistle-blowers and complaints. I brought this to the attention of the honorable minister of Works and Transport through a letter dated 4th July 2018, which was copied to you. Bids for this procurement were received in August 2017 but the process has not been finalized. The main reason for the delay in concluding this procurement has been the need to investigate and address issues raised by the whistle-blowers,” the UNRA ED stated.  “The bid evaluation report was approved by the UNRA contracts committee and has been submitted to the AfDB for a No objection prior to displaying of the Notice of the Best Evaluated Bidder. In light of the above, we are requesting that your review of the procurement process be stayed until we get a response from the Bank such that your view also takes into account the Bank’s position and guidance on the matter.”

AfDB BANK OBJECTS;

However, the bank objected to Kagina’s request for a no objection and instructed the PPDA and IGG to review the entire procurement process and asked UNRA to avail it with the outcome of the review. “As indicated in our earlier letter dated 24^th September, please share with us the outcome of the review by the Public Procurement and Disposal of Public Assets Authority of the issues brought to their attention by the whistle-blower related to this project,” an official of the bank wrote to Kagina in an email titled Review of the bid evaluation report for the Busega-Mpigi Expressway Project.

PPDA INVESTIGATES;

On 24^th September 2018, PPDA constituted a team to review the bidding process as instructed by the bank. “This is to inform you that a team from the Authority comprising of Simon Businge and Manager investigations, and Ms Miriam Nyakamadi Bigirwa, senior procurement officer audit will visit the entity to review the procurement file at your premises on Friday 7th September at 10:00am,” the PPDA Executive Director, Benson Turamye noted. The PPDA completed the investigations on 11^th November and submitted the report to the IGG, UNRA and AfDB. Sordid details unearthed by PPDA show CMS –ADVENT bid was marred with inconsistencies and irregularities; financial, legal, material and technical which UNRA (by either commission or omission) ignored. The findings indicate that the CMS-ADVENT LTD JV should have been collapsed in the preliminary stages of the evaluation process because of material deviation and forgery which experts say may lead to another Katosi-Mukono road scandal. In the report, PPDA raises a number of pertinent issues regarding UNRA’s preferred Best Evaluated Bidder (CMC DI RAVENNA/ADVENT JV). The issues particularly raised include; there were inconsistencies in the information in the bid submitted by the CMC – Advent Joint Venture where the lead partner is stated as CMC Di Ravenna, South Africa in the Joint Venture Agreement, while in the Bid Information sheet it is referred to as CMC Di Ravenna-Italy. The report further notes that in the certificate of registration and Articles of Association it is indicated Cooperativa Moratori & Cementisti-CMC Di Ravenna Societa Cooperativa abbreviated as CMC Di Ravenna Soc.Coop.  “The inconsistency of information in the bid makes it difficult to establish which JVCA partner was involved in the procurement process i.e. CMC Di Ravenna S.C.A.R.I – SUDAFRICA BRANCH, CMC Di Ravenna South Africa or CMC Di Ravenna-Italy,” the findings indicate. The report also notes the taking over certificate for Oxbow-Mapholaneng Road has inconsistent dates i.e. CMC Di Ravenna partial completion certificate was dated 21^st April 2016 while it is endorsed on 17/03/08. The procurement body further raises questions on the curriculum vitae of the five proposed staff in the CMC-Advent Joint Venture bid. The report says the bidding document did not indicate the activities carried out on the projects except for positions held and projects undertaken. “In addition, staff such as the Environment and Social Manager with a degree in Aeronautical Engineering were found non-responsive for failure to include relevant technical qualifications which were not expressly stated in the bidding document.” Also the bid security submitted by CMC-ADVENT JV didn’t’ comply with the provisions of ITB 19.8 of the bid requirements as and as such the firm should have been eliminated at the preliminary evaluation for non-compliance. ITB 19.8 says “Failure to submit a bid containing all the required information and documentation” leads to disqualification of the bidder. The report further notes that all legal documents including powers of attorney submitted by CMS indicated the names as C.M.C DI RAVENNA SOCIETA CO-OPERATIVA, but in the bid security and forms, they are simply referred as CMC DI RAVENA.

EXPOSING MORE;

Details further show the bidder information sheet submitted for ADVENT LTD, the bidder’s authorization representative is stated as AJITH SHYMA PRASAD. However, Prasad is not the same person who signed the document on behalf of ADVENT LTD. “Also a close scrutiny of the powers of attorney shows that DHRUV JOG is in possession and this is inconsistent.” The report further punches holes in the audited financial accounts submitted by ADVENT LTD. The documents notes are not signed by the directors even where there is a provision for signing, they are too faint to be read or deduce their financial standing which PPDA says is “a sign of a bidder trying to conceal information.” It’s further disclosed that; “The audited financial books of accounts should not have been sustained by the evaluation committee.” The details obtained from the report further indicate the Advent Ltd bid didn’t contain a certificate of incorporation for Advent Ltd.  Information indicates the certificate of incorporation provided is for Tanzania International Enterprise Ltd and there was no documentary evidence to confirm that this relationship if any. “The specific experience of CMS-ADVENT LTD JV cannot be independently verified on account of difference in names of the lead partner in the joint venture and the registration and legal documents submitted with the bid. Also ADVENT LTD doesn’t demonstrate the general experience required for the works and yet each party must meet the requirements,” an insider notes. The experts’ further punches holes in the ADVENT LTD bid saying the experts listed for the job cannot enable them do the task of executing such a multi-billion superhighway project. “In the technical evaluation criteria, under the key personnel, the paver foreman, quarry manager, environment and social manager didn’t indicate the activities they undertook in their past assignments. It was therefore not possible to adequately asses their experience, adequacy and suitability for execution of the works,” the report says. Yet that isn’t all. The bid has been under evaluation with an expired bid security at some point.

OTHER BIDDERS; On the other firms like China Civil Engineering Construction Company, PPDA says it was properly evaluated with respect to the performance on previous contracts and specific experience and that the bid security for China Civil Engineering Construction Company and China Railway 19th Group Co. Ltd was extended to 30^th November 2018. The report says the bid security was responsive to the requirement in the bidding document and the powers of attorney were signed. “There was no evidence to support the allegations that there were corrupt practices on the part of China Civil Engineering Construction Company Ltd (CCCECC) in JV with China Railway 19th Bureau Group Ltd to influence the award of the contract,” the report says.

RECOMMEDANTIONS;

PPDA recommends that the evaluation committee should re-consider re-evaluation and assess the validity of the CMC-Advent Busega JV bid in light of the inconsistences in information in the bid submitted by CMC-Advent Busega where the lead partner is stated as CMC Di Revenna (South Africa) in the joint venture agreement while the bid information sheet is referred to as CMC Di Ravenna-Italy  and certificate of registration and Articles of Association it is indicated as cooperative Muratori & C.M.C DI RAVENNA SOC.COOP “CMS-Advent Busega JV’s taking over certificate for Oxbow to Mapholaneg Road project with inconsistent dates makes the authenticity of the document suspect and should be verified with the project owner/employer in South Africa,” PPDA concluded.  The authority also wants documents provided by China Gezhouba Col. Ltd investigated. “The entity should investigate the inconsistencies as regards the name of the employer in the notification award, completion certificate and specific experience for the Wuhan-Jianli expressway by China Gezhouba Co. Ltd. Also the completion certificate indicated the employer as Hubei Hough Highway Ltd while the award notification had Hubei Chengtao Tendering Co. Ltd,” the report states. PPDA also asks UNRA to ensure the user department and contracts committee conduct comprehensive review of the bidding document to ensure that the qualification and evaluation criteria are commensurate to the complexity and value of the project.

LAWYER EXPLAINS;

Red Pepper legal expert Dickens Byamukama says the situation is analogous to another Katosi scandal if this bid is allowed to succeed. He says in the procurement of the contractor for the upgrading of the Mukono – Katosi – Kisoga – Nyenga road in Uganda V Byandala & 6 others (Session case 12 of 2015), the judge was asked to consider the identity of the contractor that had been an issue from 2010. “Whilst Eutaw Mississippi was the bidder, a letter by Ayelew Belew the Director Procurement at UNRA was addressed to Eutaw Florida. Court ruled that the Director of Procurement and Contracts Committee should be held responsible for awarding a contract to a wrong bidder,” he warned. Mr. Byamukama added that in the Mukono-Katosi –Kisoga-Nyega Road, court ruled that “The fraud in procurement of a contractor started in 2010 when a bid presented to UNRA by A5 [Moses Senkeeto] purporting to be a bid for Eutaw Mississippi but with Eutaw Florida tagged on Moses Senkeeto [A5] as its representative.” At the stage of bid opening, the Eutaw Bid should have been rejected. The procurement unit allowed this bid to go through to evaluation stage and the contracts committee also strangely allowed it not only to pass but in fact to win the contract. The procurement officials and the contracts committee members are strangely not in the dock. Yet officials such as A1 and A2 who came on board much later in 2011 and 2013 respectively were charged in court. This is long after the plot had been hatched to defraud UNRA of money.’ Also in the procurement of civil works for the construction of the Bujagali Dam in Uganda, Byamukama recalls, whilst SALINI Constructori-SPA was the company that bought the bidding document, the company that bidded was SALINI -SPA. “The bid for SALINI-SPA was disqualified as a material deviation on the name of the bidder. SALINI-SPA challenged this decision and lost the case.” “Therefore, the legal name of the bidder is inconsistent with the birth name in the articles of association and is not accompanied by any statutory declaration as required by law. On the basis of all this questionable acts of the bidder, this bid should have been rejected to prevent putting the procurement of this road project at risk,” the expert noted. He said the bid is likely to be challenged immediately after being awarded. “Legal action is likely to be taken against UNRA and those responsible for the award despite notice of the anomalies as was recommended in the above referred Session Case No. 12 of 2015.” Byamukama says there is room to initiate private prosecution against such errant government officials. Two weeks after receiving the report, the UNRA and the bank are still silent on the issue despite the fact that taxpayers are coughing more cash to service the loan that has been idle for the last three years. Story adopted from Red Pepper and here again reproduced with modifications. For comments, reach us on 0703164755.