Government stands to lose a minimum of Nu.125m: Opposition
In order to save Nu.21 million the Government stands to lose a minimum of Nu.125m. “Compensation of Nu.75m offered to the two contractors plus a possible cost increase of Nu.50m”, opposition members said, at Meetthe-press last Thursday.
Dagana had been recognized as one of the most underdeveloped Dzongkhags, with high incidence of poverty, mainly due to connectivity problems.
South Thimphu MP Yeshey Zimba said The Government had accorded high priority to construction and improvement of motor roads during the 10th plan. “The most important road project was the Dagapela to Lhamoidzingkha highway approved by the former government.” He said.
The Government of Netherland has funded half cost for the construc- tion of the DagapelaL-hamoidzingkha highway.
The MP said the government of Netherland, through an agency named ORIO, agreed to provide 50 percent of the cost as grant. The total cost of the 80.58km road project was estimated at Euro 21.34million.
According to the opposition party, the project was divided into three packages and tendered out for international competitive bidding (ICB) and awarded in September 2014.
The package ‘A’ extents 29km costing of Nu.354.88million was tendered to Kolika Construction of Nepal and Yanghil Construction in Bhutan. The package ‘B’ consists of 20km which cost of Nu.415.73m was tendered to Tundi Construction of Nepal. While the package ‘C’ of 31.6km at the cost of Nu.358.18million (Dagapela to Gesarling) was awarded to Gaseb-SPML joint venture.
However, he said Ms Rinson-Jaiprakash Associates, one of the bidders, complained to Anti Corruption Commission (ACC) that it was the lowest bidder at Nu. 336.6million and that the award of package ‘C’ to Gaseb-SPML was not fair.
“The ACC, after carrying out a thorough review and finding no evidence of corruption, instructed the Government to reevaluate the tender or revoke the contract and re-tender in the interest of better value for money,” addeding that the Government, for reasons not known, cancelled the contract package B and C with no regard to the inevitable delay in the works and subsequent cost escalation which would have serious repercussion on value for money.
“The third package was not cancelled and work is in progress,” MP said.
However, the Government had repeatedly cleared that the reason for the cancelled of the contract was the order issued by ACC which cast doubts on prevalence of corruptive practices in the award of the contract.
“The reputation and image of the officials of the Ministry of Work and Human Settlement (MoWHS) and the contractors have unfortunately been tarnished,” MP Yeshey Zimba said.
“The Government offered compensation of Nu.35m to Tundi and Nu.40.0m to GasebSPML. Ms Tundi accepted the compensation. Gaseb- SPML however refused to accept the compensation and instead took the ministry to court,” he added.
According to the opposition parties, the contract had been awarded in keeping with established practices, rules and regulations of the Government. GasebSPML submitted a claim for Nu.330.0 million to the court.
He also said presently the case is before an Arbitration Committee as required by the contract agreement. In the meantime the Supreme Court upheld the decision of the Thimphu Dzongkhag Court ordering the Government to pay GasebSPML a sum of Nu.150.0 m by the 10th of July pending the Arbitration Committee decision.
He added that the main reason for the ACC recommendation was that the Government had not made any attempt to gain better value for money, by a more thorough evaluation, given that the bid submitted by the lowest bidder was 21.0 m lower.
He also said while cancelling the contract the Government conveniently forgot about the inevitable cost escalation and benefits forgone by the package.