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MRA bloats contract by K324 million

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Reyneck Matemba

Malawi Revenue Authority (MRA) bloated a technology infrastructure contract by K324 million, a year after the contract went without being executed, The Daily Times has learnt.

Irked by what it believes was an irregular increase in the contract amount, Human Rights Defenders Coalition (HRDC) has asked the Anti- Corruption Bureau (ACB) to probe the deal.

In 2015, MRA entered into an agreement with a Zambian company to supply, configure and install Primary DR Converged Infrastructure at K1.9 billion (US$2,721,138).

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However, a year into the contract, the two parties entered into an addendum to the contract, raising the amount to K2.314 billion ($3,170,125.77).

In a letter dated June 25 2015, MRA informed Technet Global Limited that they had been awarded a contract worth $2.7 million including local taxes saying: “We, therefore, request you to submit your letter of acceptance if you are in agreement with the offer so that we come up with a final set of documents for both parties’ signatures.”

But according to an addendum signed by the then MRA Director General Tom Malata on July 5 2016, the sum of the contract was increased to $3.2 million without changing the technical specifications.

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Other MRA officials that were involved in the signing of the addendum were Company Secretary Felix Tambulasi and deputy Commissioner General Roza Mbilizi, while Managing Director Jhelyn Mwanamuke signed on behalf of Technet Limited with Mwape Mbita as a witness.

However, a source conversant with procurement procedures told The Daily Times that there was an anomaly in the way the contract was handled, saying if one year elapsed before implementation of the contract commenced, the contract needed to be re-advertised.

He said it was wrong for MRA to sign an addendum on the contract that had been idle for one year, adding that increasing the contract price after the contract had already being signed put the other bidders at a disadvantage.

“You cannot add a contract amount a year after signing. That is flouting procurement procedures. That puts the other bidders at a disadvantage,” he said.

Raising the query in a letter to ACB Director General Reyneck Matemba, HRDC said there was suspicious conduct as the addendum was signed after a year of signing the contract.

“The changes in the contract happening over a year are suspicious. We wonder why they did not just re-advertise given the time lapse. We are informed that there were no changes in the technical specifications of the contract,” reads the letter.

HRDC Chairperson Gift Trapence said the MRA whistle blower indicated in his letter to HRDC that the installation of the Primary DR Converged infrastructure only involved changing a system in the computer and that K2 billion was on the higher side.

“The whistle blower further told us that MRA was paying commissions for the third parties in the agreement which was a further increase to the amount paid,” he said.

An email from Technet Global Limited to MRA asked for payment of about K31,390,000 to a South African-based company as commission.

Trapence explained that the said commission was going to a third party and the amount of $43,000 was paid outside the contract.

“It is strange for a middleman to be paid by the client. The middleman was supposed to receive the money from the supplier and not the client,” he said.

Matemba confirmed receiving the documents.

“It is amazing to have the documents that HDRC has managed to source. The documents are relevant and handy. We have somewhere to start from,” he said.

MRA Head of Corporate Affairs Steven Kapoloma confirmed that they had a contract with Technet Global (Zambia) for the supply, configuration and installation of primary DR converged infrastructure.

“The Authority welcomes any investigations on this or any other contract with Technet Global (Zambia) to ascertain the allegations made,” he said.

HRDC has embarked on whistle blowing exercises that have seen Malawians submitting documents in line with anomalies taking place in government departments and agencies.

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