Apr 30, 2017 News
A prominent contractor for the State has urged the administration to consider blacklisting contractors with poor performance records.
Managing Director of Gaico Construction Inc., Komal Singh, is also calling for Government to be more rigid in their enforcement at project sites.
The calls were made by the contractor in a letter to the Editor and would come at a time when there are questions over the performance of government engineers.
Last week, a number of tenders opened for several contracts, indicated that the engineer’s estimates were way above the prices tendered.
It raised questions about the methodology used by the State’s engineers to arrive at their costs and even possibilities of corruption.
However, Gaico, a contractor who worked on the East Bank Demerara four-lane extension to Diamond and is involved in river dredging, said that the fault should not be laid fully at the feet of the government engineers.
The company said that had government awarded a project to someone whose prices are above the engineer’s estimate, there would have been attempts to justify these.
“Very ironic, but yet some of us are ready to cast blame on the government or the engineer sometimes.”
Singh, who said he has been a contractor in business for 25 years, stressed there is some truth about the low pricing and at the same time this can realistically be proven right or wrong by some simple analysis during the evaluation process.
“I agree that some contractors’ prices are ridiculously low in some cases and the rule of low price tender should not apply for award in those cases. Understanding why engineer’s estimates will vary from the contractors’ prices can be a complex task.”
He said that the engineers who prepare estimates use realistic market value to arrive at a rate or in some cases, past prices.
It was pointed out that when a contractor tenders, it will vary significantly due to key factors.
These include whether the contractor owns a quarry; owns equipment, has experienced workers and other logistical factors and whether the materials have to be imported.
“The position that these engineers sit in at the Ministry is not an easy position and they constantly have to be mindful on how they value projects so as to avoid being accused. I do agree that there needs to be some more training for some of the engineers in this area which I am sure is being addressed by the Government.”
Singh believed that whenever a contractor has a price which appears to be lower than the engineer’s estimates, a red flag should be raised.
“At the end, if they are not satisfied that the contractor can actually execute the work for the price they tendered, then they should be called in to make a justification on how they plan to execute before award. At the moment, the current Procurement Act states clearly that contract should be awarded to the Lowest Qualified and Responsive Tender. So government cannot easily disregard this…if not there is another section of the contractor fraternity who will accuse the government of favoritism.”
However, low prices alone are not the problems.
The contractor urged his peers to step up to the plate and stop colluding with some site engineers and Clerk of Works. He wants them to expose those that are bent on corruption.
It was also urged that contractors should only take work that they have the capacity to handle.
From the government side, Gaico said in addition to blacklisting contractors for past poor performance, more random visits should be paid to work sites.
One of the priorities of the administration must be to have the Inspectorate Board operable as soon as possible with trained, screened employees involved.
A review of the evaluation process to make it more independent would be another way forward, Singh said.
“So if you have five evaluators on a project independent evaluation must be done. This can only happen if they are not aware who the other members are that sit on the evaluation committee since it will give each member the opportunity to do their independent evaluation without the influence of others opinion. Finally they will all meet to discuss and defend their evaluation results.”
With regards to the evaluation, Gaico said it is not a good idea to award a contract without ensuring that the contractor is financially stable. He said that there are contractors who will take the advance payment to clear personal commitments thus starving the project for cash.
“Overall, the evaluation process should be clearly documented to capture some key components about the contractors and on the tender price. This will remove all the controversy as it relates to low prices and contractors past and current performance.
Engineer estimates, in my view, is for government to get a guide for budgetary purposes and what a project will actually cost. Contractors need to tender at a price that will get the job done in keeping with the requirements and the technical specification.”
The contractor believed that the government is doing a “great job” in trying to stamp out some of the issues in the procurement system.
“There is a lot more to be done but we all have a role to play in this process. We all as contractors need to take full responsibility for our actions and raise the bar when it comes to our quality and timely execution of projects. The government cannot do it alone.”
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