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Northern Region Water Board contract: Bidders cry foul

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Bidders for the Northern Region Water Board’s (NRWB) Mzimba Integrated Urban Water and Sanitation Project are complaining that they were never given transformer specifications in the Instructions to Bid Document.

A contract award disclosure advert which the board published in The Daily Times of April 21 2017 indicates that the board awarded the $14 million worth project to Sawa Group Limited and it is indicated that the other five did not make it because they did not provide the specifications and manufacturer’s authorisation for transformers.

The companies which bid for the project include Jos Hansen & Soehne GmbH/JR International Bau GmbH (Germany) which offered a bidding price of $15.8 million, Plem Construction-HE Jackson JV (Malawi) which offered a bidding price of $10.3 million, Sogea Satom (France) which offered a bidding price of $24.9 million, Raubex Construction Pty Limited (South Africa) which offered a bidding price of $21.8 million while Stecol Corporation (China) offered a bidding price of $15 million.

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But NRWB has dismissed these ‘allegations’ insisting that procedures were not flouted.

NRWB spokesperson, Edward Nyirenda, said, much as all the six bids were commercially responsive, five of the bids were not technically responsive, saying technical specifications and manufacturer’s authorisation for some of the critical materials and equipment were not provided, and some of the bidders did not complete the schedules of particulars Ref Spec Clause 8007 with the details of the proposed materials and equipment, which was a requirement.

“These being one of the major pieces of equipment, according to Instructions to Bidding (ITB) 11.1 (h), the bidders were supposed to submit manufacturer’s authorisation and brochures for the transformers. It is therefore wrong to allege that these requirements were not specified in the bidding documents,” Nyirenda insisted.

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But one of the bidders lamented that the “[issue of] Transformer [specifications] is the duty of Electricity Supply Corporation of Malawi and [they should] not [have expected] bidders to give specifications”.

Technical Specifications were clear that the bidders should provide specifications for the transformers.

The award of contract to Sawa Group Limited also raised more suspicions because the contract was awarded to a total bid price of $10.1 million but the price was raised to $14.7 million after the contract had already been awarded, a thing which the board said was an ‘Arithmetic error’.

Following reports that NRWB management might have flouted procedures in the award of the contract to Sawa Group, the Public Accounts Committee (Pac) of Parliament has had two meetings with the board’s management. The recent one was held last Wednesday.

Nyirenda said the Arithmetic for the bid submitted by Sawa Group Limited ($10, 139, 253) was not correct as the sum did not include bid prices for bill items amounting to $4, 399.58.

“When 10 percent contingency is added, the total error becomes $4,610,539.54. To correct error, $4,610,610,539.54 was added to the read out bid price for Sawa Group Limited at a contract of $14,749,792.84.

“Contract amount can either be higher or lower than the bid price depending on the discovered Arithmetic error. Of course, where there are no errors, contract amounts are equal to bid prices,” Nyirenda explained through a written response to a questionnaire.

The board also maintains it clearly indicated that bidders should provide specifications for transformers as part of the project, pointing out that this was supplied in the Bill of Quantities items 5B- 32, 5C-38,5C-38, 5C-38 and 5E -41 for which the bidding companies provided their rates.

After the first meeting (with the board), Pac concluded that NRWB has a case to answer on this African Development Bank-funded project. Pac took the board to task on why it failed to provide vital information to all the bidders. They also questioned the awarding of a contract to Sawa Group Limited which had an initial $10.1 million bid but the awarded contract rose to $14.1 million.

Nyirenda said, apart from the parliamentary probe, no bidder has lodged an official complaint or sought clarification on the reasons for their bid’s failure.

“If a bidder is not satisfied, they should follow the right procedure and officially communicate with the client as provided [for] by the Public Procurement Guidelines,” he said.

Pac is expected to release a report of its probe by Wednesday next week.

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