Adams defends restricted bidding for new Demerara bridge contractor
-says process intended to select best company
Project Manager for the New Demerara River Bridge Rawlston Adams has defended the restricted bidding process being used to select a contractor to finance, design and build the new crossing, saying that it is intended to find the best company for the job and avoid issues faced during the abortive initial efforts to select a firm to undertake the feasibility study for the project.
The Ministry of Public Infrastructure has said that contractors will be pre-qualified and three will be shortlisted and requested to submit designs and offer a fixed price lump sum bid for the design and construction of the bridge and approach roads, which has generated some concern, including from former Auditor General Anand Goolsarran, who has questioned the legality of the process.
“Procurement will be done in two (2) phases the current prequalification phase and the bidding phase. In the pre-qualification phase, three (3) contractors will be shortlisted and requested to submit designs and offer a fixed prime lump sum for the design and construction of the bridge and approach roads,” the ministry has said in an invitation to contractors for prequalification.
“The shortlisting of the bidders shall be on the basis of the profile, track record, financial capacity of the applicant as well as on the merit of the technical, cost and financing proposals presented by applicants in their prequalification document,” it added.
It also said that in order to improve the funding package, applicants for shortlisting are requested to advance proposals for financing the project.
The opening of the prequalification documents will be done on October 17 at the offices of the National Procurement and Tender Administration Board (NPTAB).
Adams, seeking to assuage concerns about the shortlisting of contractors and to offer clarity on the selection process of Dutch firm LivenseCSO for the prefeasibility study, told Stabroek News on Monday that the process being utilised is nothing new. He also stressed that he wanted the public to understand that submissions would not be restricted to only three companies when the prequalification documents are opened on October 17 but all companies that believe they meet the specified criteria can submit.
He said that the shortlisting of three companies will come after the evaluation of the general pool. The evaluation process can take up to six weeks and could be further extended in some cases to facilitate due diligence.
“In the previous prequalification [for the feasibility and design], 22 firms indicated their interest. Twelve were shortlisted and only two submitted. The reason the other 10 gave was that the shortlist was too long and they are not going to waste their time because the probability of them winning the contract was too small,” Adams further noted.
“So, here we come to this… Do we go back to this, where we invite ten persons and only one or two persons showed an interest? We are saying for this cost now and so we don’t go back to the same problems, we restrict it to three companies. So the chances of winning the tender is very high. If you have 15 companies spending $15 million, the probability is very high. You have to remember that in the fifth paragraph [of the invitation] we are even looking to add financing. You are looking for people who will bring financing into it. [What are] the chances with you ending up in your shortlist with just one or two companies were you open to 15 and then after only get one or two submit a bid? You don’t have the interest you need and end up with not the best companies and you want the best companies,” he added.
Meanwhile, Chief Transport and Planning Officer Patrick Thompson, who was present, also emphasised that the process is not intended to exclude anyone.
“By the 4th of September, we had more than a dozen firms that would have expressed their interest. All of them, we hope, on the 17th of October, will give us their documents, but obviously 20 firms or 22 cannot build the bridge. At some stage, you have to start narrowing down that number to one firm. In that process of first narrowing down those multiple firms, that will submit their bids on the 17th, we will take the three best firms of the lot,” he noted.
“All of them might be able to build the bridge. They have already given us the information about the company [saying] that ‘we have built here there and everywhere,’ but only one company or firm can build the bridge. You can’t have 17 or 20 or 22 firms. So, in the process of evaluating them, their financing, technical capabilities and a whole number of criteria, we will determine which of these three firms will provide us with the best design, build package. The process has to be narrowed down. Even in an EPC [Engineering, Procurement, and Construction]-style contracting… we shortlist. We go out and shortlist say get 15 firms but out of that we only want one single firm. I want to get it clear that on the 17th we will not get or want three bids. We expect to get more than a dozen; close to two,” he added.
Not valid
But Goolsarran has argued that it was unlawful to have multiple companies submit to a prequalifying process and then only restrict bidding to three. “The arguments put forward by the ministry are not valid. All contractors applying for prequalification must be assessed against the prequalification criteria. It they satisfy the criteria, they must be invited to submit tenders. The ministry cannot place any restriction as to the number of contractors that it will prequalify as this is against the Procurement Act,” Goolsarran told Stabroek News.
“In accordance with Section 6 (5), the procuring entity shall make a decision with respect to the qualifications of each supplier or contractor submitting an application to prequalify. In reaching that decision, the procuring entity shall apply only the criteria set forth in the prequalification documents. By Section 6(8), should the procuring entity decide that a supplier or contractor does not satisfy the prequalification requirements, the supplier or contractor may, upon request, obtain a review of that decision pursuant to Part VII. This part deals with bid protests,” he explained.
Goolsarran said that the ministry was wrong to advertise to prequalify contractors and then only select three from the pool without knowing which companies would bid and if all are competent and tried and tested contractors. “If you have 25 companies for example and if all prequalify then so be it, all will have to tender,” he said.
Thompson, however, said that it seems that there was a misunderstanding by many persons of the advertisement and that the criteria document will be what will be used to judge the best three.
He assured that there would be no breach of laws but a fair evaluation will be conducted to ensure that only the best three firms are selected and then they will compete against each other for the contract.
“The executing agency along with NPTAB, they will appoint the evaluators. There is a scoresheet. The document we sent to them shows [that] the criteria say if you have financing you get so much points …and that will help us come down to three. All the firms that are prequalifying understand this process,” Thompson explained.
Adams also emphasised that the intention is to select the best. “I want to make sure the pool is the best. We are saying that from our experience previously, where we had 12 then it only came to two, we don’t want that again… We expect more than ten [tenders] and the best three, based on the predetermined scorecard, will be chosen…we have already established the evaluation criteria,” he added.
Asked what happens if more than three clients score the same evaluation points during the process to shortlist three firms, Adams said that the submissions will be scrutinised until the “best three” are chosen.
“The goal of the process is to find the three best. So sometimes in the first round of evaluation, you might have a stalemate but you will definitely have to determine… and we have to go back. You have to come down to three and you have to do it in a fair and transparent manner,” he added.
Misinterpretation
Meanwhile, the recent disclosure by the ministry that it solesourced the consultancy for the feasibility study for the project has attracted some criticism, including accusations by the opposition of a lack of transparency and a violation of the procurement rules.
A representative of one
company that had initially bid for that contract before the process was annulled told Stabroek News that it believes that only two bids were received because the scope of the works were changed.
The company rep, who spoke on condition of anonymity, said that initially the tender was for a prefeasibility and actual designing of the bridge at an approximate US$800,000 price tag. “It was too much work for too little money and the company said it was not feasible to them to do the project. But then the scope changed to just the prefeasibility study without informing anyone,” the executive said.
But Adams rejected this assertion and denied that the scope of the works were changed, while saying that the project always entailed a conceptual design and feasibility study.
“That is not our fault… don’t accept that from a multibillion dollar company. That is a downright excuse. A big company that doesn’t understand what a client means picks up the phone and calls. It was always conceptual because we intended to go this way. The only way you can do an EPC is if you had the money in the bank. We don’t have the money, we couldn’t design the bridge. There is nothing else to it,” Adams stressed.
“We maintain it was always a conceptual design. We didn’t change the scope, it was their interpretation of the scope. We are saying they didn’t understand. They are saying that they are interpreting. If they wanted clarifications, they could have easily written to us and we would have responded. That was just an email away,” he added.