The Inspectorate of Government has cancelled the tender for the
sh312b second phase of the National Social Security Fund (NSSF) pension
towers over leaked information and corruption.
Jamwa,
the then head of NSSF, showing an artistic impression of the Pension
Towers. The project contract was signed in April 2008
“The whole of the bidding process for Phase 2 of the NSSF Pension
Towers should be cancelled owing to the amount of information about it
that has gone out to various bidders, staff of various institutions
involved in review processes and the general public, as well as the
persistent allegations of corruption,” the inspectorate said in its
report.
The report released on Monday added that the NSSF board of directors
and management should implement their resolution to outsource services
for procurements in respect of projects that are above $2.5m (sh6.6b),
starting with the procurement of a contractor for the towers.
The inspectorate noted that preparation of bidding documents should
correct the anomalies and gaps identified by the Public Procurement and
Disposal of Public Assets Authority (PPDA) in its administrative review
in order to prevent re-occurrence of mistakes identified in the previous
procurement processes.
It added that bid documents should be critically reviewed and
approved by PPDA before the procurement commences. The inspectorate said
outsourced service providers should carry out procurement strictly
according to PPDA provisions and bid documents.
Warnings
The inspectorate ordered the NSSF board of directors to sternly warn
the corporation secretary, David Nambale, and accounting officer Patrick
Ayota, for failing to provide the necessary advice to ensure that the
re-evaluation of bids for phase two of the Pension Towers Project is
carried out by an objective and impartial evaluation committee, and for
their resultant contribution to delaying the project.
“The members of the re-evaluation committee who are employees of NSSF
be subjected to disciplinary proceedings for failure to comply with the
law and regulatory guidance contrary to the Ethical Code of Conduct
under the PPDA Act and Regulations, and for their contribution to the
delay in procuring a contractor for the project,” the report stated. The
recommendations followed several complaints against the management of
NSSF alleging that there was corruption in the award of the tender to
construct the pension towers.
There were also earlier allegations that a Chinese firm, China Civil
Engineering and Construction Corporation (CCECC), whose bid was being
considered for the award was sh20b higher than that of China National
Aero-Technology International Engineering (CATIC), which was the lowest
pre-qualified bidder. The inspectorate noted that because of the
interest by the NSSF managers, the NSSF head of procurement, Elis
Biryahwaho, was interdicted so that the fraud could be covered up.
Biryahwaho’s job was recently advertised.
Complaints by bidder
At around the same time, one of the bidders complained about the
process to PPDA. Following consultations between the inspectorate and
PPDA, it was agreed that PPDA proceeds with investigations into the
allegations.
Although the bidder’s complaint was later withdrawn from PPDA, the
NSSF board of directors had also lodged a complaint with PPDA about the
process and requested for an administrative review, which PPDA carried
out.
The PPDA report issued on September 18, 2012, and copied to the
Inspectorate of Government recommended that NSSF conducts a
re-evaluation of the 17 bids that had been submitted for
pre-qualification, taking into consideration the PPDA findings and
observations.
But shortly after, the inspectorate received another complaint from a
whistleblower that the NSSF management had ignored the recommendations
made in the PPDA administrative review.
“Despite the report by PPDA that queried the award of the tender to
CCECC, NSSF has gone ahead to pre-qualify the company in the
re-evaluation exercise notwithstanding that the company did not meet the
preliminary requirements. CCECC had been faulted in the PPDA report for
submitting defective Powers of Attorney and using experience of
subsidiary companies and thus could not pass the pre-qualification
stage,” the whistleblower wrote.
The Inspectorate of Government then decided to stop the tendering process and carry out an investigation into the allegations.
Missing documents
The best evaluated bidder (CCECC) was supposed to be displayed on the
NSSF notice board for public view from July 30 to August 10, 2012 as
required by law, but the documents were stolen earlier on July 27, 2012.
In the memo addressed to NSSF’s managing director Richard Byarugaba,
Biryahwaho said; “This is to bring to your attention that a copy of a
pre-qualification document and tender document that were submitted to
PDU (Procurement and Disposal Unit) by the above company (CCECC) were
taken out of office on the Friday evening (July 27) without our
knowledge.”
Biryahwaho also copied the memo to contracts committee members;
Edward Senyonjo (acting NSSF head of risk) and Geoffrey Barigye (head of
audit).
Following the documents’ disappearance, Biryahwaho noted that
competing firms might have got hold of the pre-qualification and bid
documents that CCECC had submitted together with the copy of the
evaluation report that had just been concluded.
“In light of this, I find it difficult as the custodian of these
documents and all the procurement-related information to guarantee
confidentiality of information regarding the just concluded evaluation
process of the Pension Towers project,” he wrote.
In March, ROKO Construction Company which constructed the basement of
the towers lost out on the contract of the towers that covers 16 acres
on plots 15A, 15B and 17 on Lumumba Avenue in Nakasero.
Seventeen companies responded to the pre-qualification bidding
process. However, Roko was not considered among the final three
companies which were asked to submit their bids for evaluation.
The three selected Chinese firms were; CCECC, CATIC, and Sinohydro
Corporation Limited, a Chinese state-owned hydropower engineering and
construction company.
Rising costs
The project whose contract was signed on April 1, 2008, had its cost
first shoot up from sh36b to sh120b by 2008, prompting Parliament to
summon NSSF chiefs to explain. The then NSSF chairman, David Chandi
Jamwa, attributed the rise to extensive changes in the project design.
But by the beginning of 2009, the cost had risen to sh147b and it is expected to shoot up to $120m (sh312b) upon completion.
The entire complex, which consists of three joint towers; two of them
having 10 storeys each, and another having 23 storeys, will cover
60,000 square meters when completed.
Byarugaba had in March 2012 said the second phase was expected to be
complete within three years – meaning it will be finished by 2015, but
the cancellation of the tendering process is likely to affect it.
The first phase of the project was supposed to be completed in two
years, but took longer after a retainer wall collapsed on October 14,
2008, killing seven workers and leaving scores injured. The construction
was supposed to begin on April 1, 2008 and end by at least May 2010.
But after the tragedy, the works dragged on up to January 2012 when Roko completed the first phase.
By Chris Kiwawulo, The New Vision
