The Bureau for Public Procurement (BPP) has queried the Minister of
Works, Power and Housing, Babatunde Fashola over the award of 10 road
and bridge contracts worth N166 billion.
Works, Power and Housing, Babatunde Fashola over the award of 10 road
and bridge contracts worth N166 billion.
The BPP said the minister and his ministry violated the laws
guiding contract awards in Nigeria in the manner they selected
contractors for the projects.
guiding contract awards in Nigeria in the manner they selected
contractors for the projects.
The procurement agency is asking Mr. Fashola to explain, among
other things, why the costs of some of the projects were inflated and
why some were awarded to unqualified firms.
other things, why the costs of some of the projects were inflated and
why some were awarded to unqualified firms.
The construction of the roads and bridges, spread across the country, were appropriated for in the ministry’s 2016 budget.
The projects are the rehabilitation of Numan-Jalingo Road awarded
to Deux Projects Ltd for N11.7 billion; replacement of substandard
bridges along Gusau-Sokoto Road awarded to Triacta Nig. Ltd (N1.01
billion); construction of Ojutu Bridge in Ilobu, Osun State awarded to
Halicass Integrated Ltd (N522.2 million); construction of Ohan-Moro
Bridge on Ilorin-Igbeti Road awarded to Bonus Nig. Ltd (N942.6 million);
and rehabilitation of Abuja-Kaduna Road awarded to CGC Nig. Ltd (N26.9
billion).
to Deux Projects Ltd for N11.7 billion; replacement of substandard
bridges along Gusau-Sokoto Road awarded to Triacta Nig. Ltd (N1.01
billion); construction of Ojutu Bridge in Ilobu, Osun State awarded to
Halicass Integrated Ltd (N522.2 million); construction of Ohan-Moro
Bridge on Ilorin-Igbeti Road awarded to Bonus Nig. Ltd (N942.6 million);
and rehabilitation of Abuja-Kaduna Road awarded to CGC Nig. Ltd (N26.9
billion).
Others are rehabilitation of Kaduna-Zaria Road in Katsina State
awarded to Arab Contractors Nig. Ltd for N14.8 billon; rehabilitation of
Zaria-Kano Road in Kaduna/Kano State awarded to Reynold Construction
Nig. Ltd (N69.9 billion); and the construction of
Burga-Dull-Mbatill-TadnumGpbiya-Badagari-Gwaranga-Sum, Bauchi State
awarded to Rahama Civil Works Nig. Ltd (N10.9 billion).
awarded to Arab Contractors Nig. Ltd for N14.8 billon; rehabilitation of
Zaria-Kano Road in Kaduna/Kano State awarded to Reynold Construction
Nig. Ltd (N69.9 billion); and the construction of
Burga-Dull-Mbatill-TadnumGpbiya-Badagari-Gwaranga-Sum, Bauchi State
awarded to Rahama Civil Works Nig. Ltd (N10.9 billion).
The construction of Tudun
Wuss-Wandi-Wandi-Baraza-Durr-Zumbul-Polchi-Dot-Kwanar Road, Bauchi State
awarded to Dalum Construction Nig. at N12.2 billion and the
construction of Pankshin-Tapshin-Gambar-Sara-Kai-Gindiri Road in Plateau
State awarded to Metropolitan Construction Company Limited at N15.3
billion are also among the contracts slated for award by the ministry.
Wuss-Wandi-Wandi-Baraza-Durr-Zumbul-Polchi-Dot-Kwanar Road, Bauchi State
awarded to Dalum Construction Nig. at N12.2 billion and the
construction of Pankshin-Tapshin-Gambar-Sara-Kai-Gindiri Road in Plateau
State awarded to Metropolitan Construction Company Limited at N15.3
billion are also among the contracts slated for award by the ministry.
How contracts were awarded
In line with the requirement of the Public Procurement Act, 2007,
Mr. Fashola’s ministry had, in a letter dated November 7, 2016,
requested the Bureau to issue it Due Process Certificate of “No
Objection” for the award of the 10 contracts.
Mr. Fashola’s ministry had, in a letter dated November 7, 2016,
requested the Bureau to issue it Due Process Certificate of “No
Objection” for the award of the 10 contracts.
The ministry had earlier in June advertised the projects in some
national newspapers as well as the Federal Tenders Journal edition of
Monday May 30- June 10, 2016.
national newspapers as well as the Federal Tenders Journal edition of
Monday May 30- June 10, 2016.
An addendum to the advertisement was further placed in the same
newspapers and Federal Tenders Journal of Monday June 13-Sunday June 26,
2016.
newspapers and Federal Tenders Journal of Monday June 13-Sunday June 26,
2016.
On July 25, 2016, the prequalification documents were opened in the
Conference Room of the ministry in the presence of representatives of
prospective contractors, non-governmental organisations, the Nigeria
Society of Engineers and some member of the public as well as officials
of the ministry.
Conference Room of the ministry in the presence of representatives of
prospective contractors, non-governmental organisations, the Nigeria
Society of Engineers and some member of the public as well as officials
of the ministry.
In line with Part V, Clause 22, Section 4 of the Pubic Procurement
Act (PPA) 2007, the Permanent Secretary/Chairman of the Ministerial
Tenders Board constituted a Technical Evaluation Committee to evaluate
the tenders received from prospective contractors.
Act (PPA) 2007, the Permanent Secretary/Chairman of the Ministerial
Tenders Board constituted a Technical Evaluation Committee to evaluate
the tenders received from prospective contractors.
The contractors successful in the technical evaluation exercise
were “provisionally prequalified”, with their documents forwarded to the
Federal Inland Revenue Service (FIRS), and banks for verification.
were “provisionally prequalified”, with their documents forwarded to the
Federal Inland Revenue Service (FIRS), and banks for verification.
They were subsequently invited to submit completed financial tender documents.
The ministry then carried out a verification exercise on some of the claims made by bidders in their technical bids.
After the verification exercise, the ministry wrote to the BPP to
request certificate of no objection for the recommended contractors.
request certificate of no objection for the recommended contractors.
BPP’s response
However, the BPP objected to the award of the contracts citing various violations of the PPA Act.
The agency, in a report on the projects, exclusively obtained by
PREMIUM TIMES, said it would not grant the ministry due process
certificate until its concerns were “adequately addressed”.
PREMIUM TIMES, said it would not grant the ministry due process
certificate until its concerns were “adequately addressed”.
The report was signed by the Director General of the BPP, Mamman Ahmadu.
In the 64-page report, the Bureau objected to the award of the
contracts because “there are no evidences that feasibility and
financial/economic studies were conducted during projects’ preparation.”
contracts because “there are no evidences that feasibility and
financial/economic studies were conducted during projects’ preparation.”
It also expressed surprise that the ministry failed to prepare Environmental Impact Assessment (EIA) for the projects.
It said, “There are no evidences that the EIAs were prepared
for the Projects and specifically no EIA Reports were submitted for this
Due Process Review. The Federal Ministry of Power, Works and Housing
should note that Environment Impact Assessment is a very crucial aspect
of project preparation.”
for the Projects and specifically no EIA Reports were submitted for this
Due Process Review. The Federal Ministry of Power, Works and Housing
should note that Environment Impact Assessment is a very crucial aspect
of project preparation.”
Furthermore, the BPP condemned the ministry for failing to submit
the technical bids for the companies that participated in the
pre-qualification exercise.
the technical bids for the companies that participated in the
pre-qualification exercise.
“The FMPW&H did not recommend the lowest bidders for most of the lots after prequalifying the firms,” the agency said.
“The Bureau further observed that FMPW&H appears to have
erroneously categorized some critical projects in such a way that
enables contractors that are not in the same category with similar
technical and financial capacities to submit bids for such lots.
erroneously categorized some critical projects in such a way that
enables contractors that are not in the same category with similar
technical and financial capacities to submit bids for such lots.
“This has made the bench-marking and value-for-money checks
almost unfeasible and has opened avenues to subject the procurement
processes to many frivolous petitions and counter-petitions that could
likely delay the immediate commencement of the projects.”
almost unfeasible and has opened avenues to subject the procurement
processes to many frivolous petitions and counter-petitions that could
likely delay the immediate commencement of the projects.”
More bashing
Commenting specifically on each of the 10 projects one after the
other, the Bureau noted that although the ministry recommended the
lowest contractor for the N11.7 billion Numan-Jalingo Road project, most
of the companies that submitted bids for the project were not in the
same category and ranking that would enable proper bench-marking.
other, the Bureau noted that although the ministry recommended the
lowest contractor for the N11.7 billion Numan-Jalingo Road project, most
of the companies that submitted bids for the project were not in the
same category and ranking that would enable proper bench-marking.
“Besides, the capacity of most of firms to upgrade and extend the
quality of the design and standard of this road cannot be guaranteed,”
it stated further.
quality of the design and standard of this road cannot be guaranteed,”
it stated further.
The Bureau therefore advised the ministry to carry out
post-qualification on all the firms that submitted bids for this Lot to
verify their actual capacities and eliminates firms that do not have
technical and financial capacity to execute the project.
post-qualification on all the firms that submitted bids for this Lot to
verify their actual capacities and eliminates firms that do not have
technical and financial capacity to execute the project.
On the replacement of substandard bridges along Gusau-Sokoto Road,
the Bureau said the ministry considered the submission of Messrs. China
Zhonghao and Ric Rock Construction Ltd that submitted the third and
fourth lowest bids non-responsive.
the Bureau said the ministry considered the submission of Messrs. China
Zhonghao and Ric Rock Construction Ltd that submitted the third and
fourth lowest bids non-responsive.
It however noted that the basis for their disqualification was not made known by the ministry.
It asked the ministry to carry out post-qualification on all the
firms that submitted for this Lot to verify their actual capacities and
eliminate firms that do not have the technical and financial capacity to
execute this project.
firms that submitted for this Lot to verify their actual capacities and
eliminate firms that do not have the technical and financial capacity to
execute this project.
On the construction of Ojutu Bridge in Ilobu, Osun State, awarded
to Halicass Integrated Ltd for N522.2 million, the BPP said the ministry
indicated that the rates of the lowest four tenderers were too low
while two of the contractors submitted bid securities that were not up
to two percent of the contract sum as requested.
to Halicass Integrated Ltd for N522.2 million, the BPP said the ministry
indicated that the rates of the lowest four tenderers were too low
while two of the contractors submitted bid securities that were not up
to two percent of the contract sum as requested.
It also said the ministry indicated that the submission of Messrs.
Metropolitan International Limited was corrected from N704,089,909.48 to
N122,430,000.00, which showed the firm lacked the understanding and
capacity to execute a project of that magnitude and complexity.
Metropolitan International Limited was corrected from N704,089,909.48 to
N122,430,000.00, which showed the firm lacked the understanding and
capacity to execute a project of that magnitude and complexity.
The Bureau said it observed that the actual corrected sum of the
company submitted as carried out by FMPW&H and verified by the
Bureau was N700,761,140.33.
company submitted as carried out by FMPW&H and verified by the
Bureau was N700,761,140.33.
“Nonetheless, the Bureau is amazed with the ministry’s comment on
Messrs. Metropolitan International Limited for this project, whereas the
ministry has recommended the firm for a bigger project of
N15,385,310,166.29 [Pankshin-Tapshin-Gambar-Kal-Gindiri Road].”
Messrs. Metropolitan International Limited for this project, whereas the
ministry has recommended the firm for a bigger project of
N15,385,310,166.29 [Pankshin-Tapshin-Gambar-Kal-Gindiri Road].”
The Bureau wondered why the ministry did not recommend
Bilijoe+Berger Nigeria Limited for the construction of Ohan-Moro Bridge
on Ilorin-Igbeti Road which was awarded to Bonus Nig. Ltd at N942.6
million despite its (ministry) claiming that the company’s price was
reasonable.
Bilijoe+Berger Nigeria Limited for the construction of Ohan-Moro Bridge
on Ilorin-Igbeti Road which was awarded to Bonus Nig. Ltd at N942.6
million despite its (ministry) claiming that the company’s price was
reasonable.
The ministry, according to the Bureau, indicated that the rates of
the lowest tenderer, Messrs. Blisswood Associates Limited were too low,
while the submission of Messrs. Bilijoe+Berger Nigeria Limited, the
second lowest tenderer, was considered reasonable.
the lowest tenderer, Messrs. Blisswood Associates Limited were too low,
while the submission of Messrs. Bilijoe+Berger Nigeria Limited, the
second lowest tenderer, was considered reasonable.
It however wondered why the job was not given to the company even
though their submission was lower than that of Messrs. Bonus by
N2,228,052.75.
though their submission was lower than that of Messrs. Bonus by
N2,228,052.75.
The Bureau said it was not able to verify the ministry’s claim that
Messrs. Calipak Nigeria Limited and Fiphs Investment Limited submitted
bid securities that were not up to two percent of the contract sum as
requested because the bid securities were not forwarded to it.
Messrs. Calipak Nigeria Limited and Fiphs Investment Limited submitted
bid securities that were not up to two percent of the contract sum as
requested because the bid securities were not forwarded to it.
The BPP expressed surprise at the ministry’s claim that it did not
award the rehabilitation of Abuja-Kaduna Road awarded to Messrs. Gilmor
Nigeria Limited because its jobs were mostly in irrigation and housing
with very few district roads within Abuja and with no completion
certificate.
award the rehabilitation of Abuja-Kaduna Road awarded to Messrs. Gilmor
Nigeria Limited because its jobs were mostly in irrigation and housing
with very few district roads within Abuja and with no completion
certificate.
The Bureau noted that from its own database, the company was
categorised under category A with an average turnover of over N15
billion in the last three years contrary to the viewpoint of the
ministry.
categorised under category A with an average turnover of over N15
billion in the last three years contrary to the viewpoint of the
ministry.
“Messrs. Gilmor Nigeria limited has the necessary equipment,
professional expertise and personnel to undertake a project of over N10
billion,” it said.
professional expertise and personnel to undertake a project of over N10
billion,” it said.
“Messrs. Gilmor has contracts worth over N36 and N40 billion for
the development infrastructure facilities for Guzape district I &II
and Jahi district respectively.”
the development infrastructure facilities for Guzape district I &II
and Jahi district respectively.”
The Bureau requested the ministry to provide it with details of why
Messrs. Dantata & Sawoe, Setraco Nigeria Limited and RCC 7& CO
Nigeria Limited were disqualified since it (ministry) did not give
reasons for doing so.
Messrs. Dantata & Sawoe, Setraco Nigeria Limited and RCC 7& CO
Nigeria Limited were disqualified since it (ministry) did not give
reasons for doing so.
The Bureau demanded explanation on why the ministry prequalified
Messrs. Kaiba International Nigeria Limited and Olivec Ventures Limited
for the rehabilitation of Kaduna-Zaria Road in Katsina State despite not
having annual turnover of up to the required N10 billion.
Messrs. Kaiba International Nigeria Limited and Olivec Ventures Limited
for the rehabilitation of Kaduna-Zaria Road in Katsina State despite not
having annual turnover of up to the required N10 billion.
It said the firms had an average turnover of about N250 million and ought not to have been prequalified.
On the rehabilitation of Zaria-Kano Road in Kaduna/Kano State
awarded to Reynold Construction Nig. Ltd at N69.9 billion, the BPP
expressed concern about the “excessive unit rates” posted by the company
for the project, saying they were “not commensurate rates with similar
rates posted by other contractors with similar ranking that submitted
bids for similar projects.”
awarded to Reynold Construction Nig. Ltd at N69.9 billion, the BPP
expressed concern about the “excessive unit rates” posted by the company
for the project, saying they were “not commensurate rates with similar
rates posted by other contractors with similar ranking that submitted
bids for similar projects.”
It added, “The Bureau is bemused why the cost of the Kano-Zaria
axis that is about 78km. Furthermore, the cost of approximately 2.5
times the cost of Abuja- Kaduna that has about the same distance. The
Bureau is not convinced that there was competition for this Lot.”
axis that is about 78km. Furthermore, the cost of approximately 2.5
times the cost of Abuja- Kaduna that has about the same distance. The
Bureau is not convinced that there was competition for this Lot.”
It therefore requested the ministry to re-examine the submission of
Messrs. RCC and ensure that the contract price was realistic that would
give government best value for money.
Messrs. RCC and ensure that the contract price was realistic that would
give government best value for money.
The Bureau said Messrs. Rahama Nigeria Limited should not have been
given the contract to construct the N10.9 billion
Burga-Dull-Mbatill-Tadnum Gpbiya-Badagari-Gwaranga-Sum road.
given the contract to construct the N10.9 billion
Burga-Dull-Mbatill-Tadnum Gpbiya-Badagari-Gwaranga-Sum road.
According to the Bureau, the company with an average turnover of
about N250 million entered into a joint ventures agreement with Messrs.
F.I.K Global Limited in order to meet the N2 billion minimum turnover
requirements.
about N250 million entered into a joint ventures agreement with Messrs.
F.I.K Global Limited in order to meet the N2 billion minimum turnover
requirements.
“However, it was also observed that Messrs. F.I.K Global Limited
also submitted tender separately for this same project. Messrs. F.I.K
Global Limited tender in the sum of N11,225,398,261.78 was ranked fourth
lowest bid,” it said.
also submitted tender separately for this same project. Messrs. F.I.K
Global Limited tender in the sum of N11,225,398,261.78 was ranked fourth
lowest bid,” it said.
“However, this action by the two firms amounts to bid-rigging and
is contrary to section 58[10] of the public procurement act, 2007. This
has rendered the submissions of both firms non-responsive.”
is contrary to section 58[10] of the public procurement act, 2007. This
has rendered the submissions of both firms non-responsive.”
Nevertheless, the Bureau asked the ministry to carry out
post-qualification on all the firms that submitted bids in this Lot to
confirm the actual capacities and eliminate firms that do not have the
technical and financial capacity to execute this project.
post-qualification on all the firms that submitted bids in this Lot to
confirm the actual capacities and eliminate firms that do not have the
technical and financial capacity to execute this project.
On the construction of Tudun
Wuss-Wandi-Wandi-Baraza-Durr-Zumbul-Polchi-Dot-Kwanar Road, Bauchi State
at Dalum Construction Nig. Ltd, the Bureau observed that the companies
that submitted bids for this Lot were not in the same category and
ranking to enable proper benchmarking.
Wuss-Wandi-Wandi-Baraza-Durr-Zumbul-Polchi-Dot-Kwanar Road, Bauchi State
at Dalum Construction Nig. Ltd, the Bureau observed that the companies
that submitted bids for this Lot were not in the same category and
ranking to enable proper benchmarking.
It noted that the capacity of most of the firms to upgrade and
extend the quality of the design and standard of this road could not be
guaranteed.
extend the quality of the design and standard of this road could not be
guaranteed.
The Bureau further said the Lot may likely end up with series of petitions due to the outcome of the evaluation exercise.
It therefore asked the ministry to carry out post-qualification on all the firms that submitted bids.
On the Pankshin-Tapshin-Gambar-Sara-Kai-Gindiri Road in Plateau
State, the Bureau said though the FMPW&H indicated that the rates of
Messrs. CBC Global Nigeria, Well Town Stone Nigeria limited, Hypertek
Limited, Bonus Limited, Xedex Nigeria Limited and Duex Limited that
submitted the lowest to the six corrected tenders were reasonable, the
ministry did not however indicate why the lowest tenders of Messrs. CBC
Global was not recommended.
State, the Bureau said though the FMPW&H indicated that the rates of
Messrs. CBC Global Nigeria, Well Town Stone Nigeria limited, Hypertek
Limited, Bonus Limited, Xedex Nigeria Limited and Duex Limited that
submitted the lowest to the six corrected tenders were reasonable, the
ministry did not however indicate why the lowest tenders of Messrs. CBC
Global was not recommended.
The Bureau observed that the technical evaluations for all the
projects were not carried out professionally and was therefore surprised
that the ministry refused to recommend the lowest bidders after
prequalification exercise which was an indication of credibility.
projects were not carried out professionally and was therefore surprised
that the ministry refused to recommend the lowest bidders after
prequalification exercise which was an indication of credibility.
“This has cast doubt about the integrity of the technical evaluation process,” the BPP said.
“As the federal government is committed to improving the road
network within the country with such huge resources allocated towards
the projects, it has become necessary to learn from past failure so as
to avoid repeated problems in the future that will result in a waste of
the limited economic resources.
network within the country with such huge resources allocated towards
the projects, it has become necessary to learn from past failure so as
to avoid repeated problems in the future that will result in a waste of
the limited economic resources.
“The need to ensure that the scopes of works cover all major
concerns and only competent contractors are recommended has therefore
become very imperative so as to prevent loss of valuable lives,
properties and resources that always accompany such failure.
concerns and only competent contractors are recommended has therefore
become very imperative so as to prevent loss of valuable lives,
properties and resources that always accompany such failure.
“Therefore, the FMPW&H is requested to furnish the Bureau
with comprehensive details of the scope of work in the BEME for all the
projects sufficient to demonstrate how the qualities were derived.”
with comprehensive details of the scope of work in the BEME for all the
projects sufficient to demonstrate how the qualities were derived.”
When PREMIUM TIMES contacted Hakeem Bello, the minister’s
spokesperson, he declined comment on the Bureau’s report, saying he does
not speak for the ministry but for the minister.
spokesperson, he declined comment on the Bureau’s report, saying he does
not speak for the ministry but for the minister.
A staff of the ministry, who only identified herself as Grace told this newspaper on phone that she was not aware of the report.
Some officials of the works ministry however wondered why the BPP
asked the ministry to go through another process of post-qualification
of firms after all award processes have been completed.
asked the ministry to go through another process of post-qualification
of firms after all award processes have been completed.
“What the BPP should have done is to compel the ministry to choose the most qualified contractor with the lowest bids,” an official said. “Allowing for any kind of post-qualifications is like changing the rules in the middle of the game.”
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Culled from Premium Times