Latest update April 18th, 2024 12:59 AM
Jun 12, 2016 News
Former Minister of Agriculture, Dr. Leslie Ramsammy, said in April, 2015, during a brief interview, that he was
unable to release the details about the final cost of the Hope Canal Project but insisted that the project was within its estimated budget – $3.6B.
However, a forensic audit into the National Drainage and Irrigation Authority (NDIA) revealed that the cost for the project was actually over $4.1 Billion.
Dr. Ramsammy had stated that he was very happy that the project was finally completed and had emphasised that it was another testimony of the People’s Progressive Party/Civic (PPP/C)’s commitment to deliver on its promises to the citizens of Guyana.
The Hope Canal Project was approved in 2009 but actual works began in 2010. After being plagued by years of delay, the project was finally completed in May, 2015.
The project was is a four-component project located at Hope, on East Coast Demerara and was hyped as being a solution to the flooding being experienced along Guyana’s Coastal Plain. The project includes a structure with a channel which will work in conjunction with three other components: the high level sluice outfall structure, the conservancy head regulator and a public bridge.
Where is the contract agreement?
The audit report stated that the project was “substantively” funded from the PetroCaribe Fund and all payments for the project were done through the Ministry of Finance.
However, the auditors stated that the Ministry of Finance, the Ministry of Agriculture nor the National Drainage and Irrigation Authority (NDIA) were able to locate contract agreement or loan terms for such a “massive” contract.
The report also showed that in addition to the monies paid by the Finance Ministry, it was also noted that the NDIA paid significant sums from its own funding for the following years excluding the cost of fuel supplied:
2013 $166,596,644
2014 $ 90,817,833
Total $ 257,414,477
There was no information available for years 2010, 2011 and 2015, the report stated.
Fuel supplied to NDIA to the Hope Canal amounted to 1,927,844 litres between June 2011 and May 2015 which amounted to G$402,919,396.Also, 14 super long reach excavators were purchased between 2009 and 2012 for the Hope Canal Project for G$441,628,000, but the Finance Office is showing G$466,862,450, the report stated.
In addition, the auditors stated that from a list prepared by Finance Staff, it showed that 18 units of machinery were dedicated to the Hope Canal Project over the years of construction. Then an additional four units with an estimated value of $90 million were added.
Two Pick-ups were purchased for $8.4 million from Ainlim Company for the Hope Canal Project, however, registrations and invoices to verify ownership and cost were not available.
Based on the information provided thus far, the Project Cost of the Hope Canal Project amounts to $4,119,294,616 but the auditors were not able to obtain any information from the Ministry of Agriculture to confirm whether any payments for the Hope Canal Project were made through its records as was done in the case of NDIA.
Deliberate efforts were made to understate the actual cost
“We were unable to obtain all the documentation to compute the actual cost of the Project as it would appear that deliberate efforts were made to understate the actual cost. NDIA, Ministry of Agricultural and Ministry of Finance were unable to access the Loan Agreement to determine the parties to the contract, the terms of the loan and the method of repayment,” the report stated.
The report continued that given the non-availability of critical information, it is reasonable to infer that the Project exceeded its original cost from the information gathered, while indicating that additional work needs to be done to access all information to determine the true cost of the project and the sources of finance.
The audit report also consisted of comments by the former Executive Officer, Lionel Wordsworth, who indicated that part of the increased cost was maintenance work done because of the prolonged time to complete the project and should not be treated as part of the project cost.
The auditors did not share this opinion because “project cost will include all cost incurred up to the point of completion.”
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