Roads Authority (RA) Chief Executive Officer Trevor Hiwa awarded a US$303 823 (K217million) World Bank funded project to his own company called Infracon Limited.
The Office of the Director of Public Procurement has since described the award as corruption enough to attract the Anti Corruption Bureau action.
The World Bank’s contract No. RA/ CON/2015-16/09 for the Design and Construction Supervision Services of Various Roads in Central Region and Southern Regions pegged US$303 823 was done following the floods that devastated the country in 2015.
This was within the Malawi Flood Emergency Recovery Project (MFERP).
In communication that we have seen Hiwa wrote the World Bank, seeking approval for the use of the Single Sourcing method for the procurement.
“Reference is made to the meeting the mission had with Roads Authority regarding the method of procuring a design and supervision consultant on the above mentioned project. We wish to request a “no objection” for the Roads Authority to engage Infracon Limited on a single source procurement method as per the Project Appraisal Document (PAD) paragraph 167 which states “The proposed project has been triggered by emergency situation (OP 10.00) and therefore, paragraph 20 of OP11.00 procurement under emergency situation using simplified procurement procedures will apply,” wrote Hiwa to the World Bank.
The letter with reference no RA/ CEO/01 dated September 9 2015 is addressed to The Task Team Leader at the World Bank with attention given to Mr. Ayaz Parvez/Mr. Francis Nkoka. The letter has the heading ‘Single Source of Design and Supervision Consultant’.
Hiwa justifies the use of single source procurement method arguing as follows:
- To gain on time as opposed to using the competitive procurement approach because a lot of time will be lost in the procurement process, hence leaving very little time for actual project implementation.
- The proposed consultant Infracon Limited has been involved in the design and construction supervision services of various road and bridge construction projects and therefore they have the capacity to undertake the various tasks under MFERP project.
- In addition, the rates to be negotiated will be similar to those that are being used on similar current contracts and computed by averaging 3 live supervision contracts similar in nature.
- The choice of Infracon is based on the fact that their work load is currently lighter as compared with other consultants present in Malawi. It is therefore our belief that they will provide a better and dedicated service to the Malawi Flood Emergency Recovery Project (MFERP).
Hiwa concludes the letter: “We therefore seek your approval to allow us to procure the services of Infracon Limited on a single sourcing procurement method to carry out a design and construction supervision consultancy services for the above mentioned project.”
And on December 18 2015, Hiwa wrote Infracon Limited giving them notice of acceptance.
“This is to notify you that your proposal dated 27th October, 2015 for execution of the Design and Supervision Services of Various Road Construction Works in the Central and Southern Regions of Malawi, Contract No. RA/CON/2015-16/09 for the Contract Price of US$303 823 (Three Hundred Three Thousand Eight Hundred and Twenty Three United States Dollars), as corrected and adjusted in accordance with the Instructions to Bidders is hereby accepted.
“You are hereby instructed to proceed with the execution of the said services in accordance with the Contract documents. Let me congratulate you on your success in this tender and wish you a successful execution of the contract,” he wrote.
But we have established that Hiwa partly owns the company.
We have also established that the company’s major shareholder is Madada Trust of Box 40494, Kanengo, Lilongwe 4 with 99 percent shareholding.
Trevor Elias Hiwa of Box 40494, Kanengo, Lilongwe 4 holds one percent.
We have further established that the directors of the company include Trevor Elias Hiwa whose occupation is engineer and whose residence is on plot number 6/25 Lilongwe, Box 40494, Lilongwe and Getrude Lynn Hiwa on plot number 6/25, Box 40494, Lilongwe whose occupation is lawyer.
The company’s secretary and director is Chizaso Eric Nyirongo of plot number 47/5/320, and of Box 1107 Lilongwe.
Infracon was formerly called Romana Infrastructure Consultants and it changed to Infracon on February 1 2014.
When asked to explain conflict of interest in the contract, RA spokesperson Portia Kajanga claimed in a response to our questionnaire that IPC met over the selection of the company.
She said minutes were available but she did not produce them.
She said the project was an emergency, hence RA’s request for single sourcing procurement method.
“We (RA) immediately commenced preparations to procure consulting engineering
companies as well as contractors to do the work but World Bank advised that since the works were emergency in nature, the Roads Authority should propose a consultant for design and construction supervision of various roads in central and southern region of Malawi and another consultant for the design review and construction supervision of the Thabwa-Chitseko- Seveni (S152) Road,” said Kajanga.
She added: “This method of procurement is contained in their [World Bank] Project Appraisal Document (PAD) paragraph 167 which states “The proposed project has been triggered by emergency situation (OP 10.00) and therefore, paragraph 20 of OP 11.00 procurement under emergency situation using simplified procurement procedures will apply”.
She said RA proposed Bua Consulting Engineers because they had carried out the initial design of Thabwa-Chitseko- Seveni (S152) Road so they were familiar with the project.
She said other than Bua, all other consulting engineering companies were already engaged with work except Infracon who were then proposed for the design and construction supervision of various roads in central and southern regions.
“The Bank then asked for comprehensive profiles of the companies, which even included the lists of directors. After this was submitted to them, the Bank further asked that both companies should submit a full proposal which would then be evaluated to satisfaction. This was done by both consultants and the proposals were reviewed by the Procurement Division and later, the Internal Procurement Committee of the Roads Authority for approval,” she said.
Kajanga said after approval the reports were sent to the Bank for their review and final approval. She said the Bank granted a ‘no objection’ to both companies and a contract was entered after satisfying all requirements.
“It should also be noted that the ODPP cleared Infracon to be bidding for supervision contracts in Malawi as far back as 2 years ago and they have been active since. In fact they are currently working on design works for Ministry of Lands and Housing following ODPP’s approval of the same,” she added.
But deputy director of Public Procurement Edward Jeke said in an interview on Thursday that ODPP has heard reports and complaints that Infracon Limited belongs to Hiwa and that it gets contracts from the Roads Authority. But he said ODPP has no evidence of such claims.
However, Jeke warned: “If it is established that Infracon Limited belongs to the CEO, Mr. Hiwa, the laws are clear that Roads Authority cannot award it contracts. That is corruption and ACB (Anti Corruption Bureau) should come in. That is conflict of interest.”
“We have heard about those reports that Infracon belongs to the CEO but we have not got the evidence,” said Jeke.
World Bank Communications Officer Zeria Banda had not responded to our questionnaire as we went to press.
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