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Tuesday, April 6, 2010

Procurement controversies -- Trinidad & Tobago

This is one report from an ongoing story. For some background, see:

Company goes from $3m in projects to $154m: The birth of UDeCOTT

Uff calls for sweeping changes

Uff: Udecott operated by its own tender rules
2. Procurement practices in the public construction sector concern the operation of a number of legal entities which undertake public construction projects on behalf of the Government of Trinidad and Tobago and which have been set up in different ways. These entities are variously referred to as “special purpose companies” or more simply “Government agencies”. They all have in common the objective of freeing them from the constraints which otherwise apply to the undertaking of works or services by the Government by virtue of the Central Tenders Board legislation, which is universally perceived as imposing unnecessary constraints and bureaucracy, leading to delay and inefficiency. While the Central Tenders Board remains in operation as a safety net, its provisions are now very largely circumvented by the Government agencies. The most prominent of these, dealing with urban development, is Udecott, whose practices and methods of operation are considered separately.

5. The Commission has examined the procurement practices of these and other Government agencies, particularly Udecott. One notable feature is that each of the agencies operates its own procurement practices and tender rules, which can be seen to differ, sometimes in important respects. No good reason has been advanced for such diversity. While there may be reasons for differences to exist, there ought to be a presumption that rules and procedures of all Government agency companies should follow the same pattern unless good cause exists for adopting different rules.

In 2005 the Ministry of Finance issued a standard procurement procedure for State enterprise bodies which was intended to apply to all State agencies. While steps were taken to promulgate this document with a view to its general adoption, the new procedure was adopted by some agencies and not others. There can be no doubt that a universally applicable standard procurement procedure would benefit the whole public construction industry, including its principal client, the Government. We recommend that the rules should be revised in the light of this report and further attempts made to secure its universal acceptance.

7. There is, in relation to Udecott and potentially in relation to other Government agencies as well, a problem of securing adequate transparency in terms of the applicable procurement rules, particularly dealing with the topics already mentioned. The adoption of a general and universal procedure would greatly aid the achievement of transparency.

17. The Government of Trinidad and Tobago introduced a White Paper on proposed legislative reform in the public construction sector in 2005. There is a lively and continuing debate between proponents of the reforms and those, including now the Government, who consider that other and preferable means are available to achieve the laudable objectives of the White Paper, particularly in the achievement of greater transparency. The concerns over the proposed Regulator System embodied in the White Paper are understandable. However, if it is the decision of the Government not to implement these proposals, there should be established some equally effective form of review through the Courts, to be available in appropriate cases. Indeed it is somewhat ironic, in the context of this Inquiry and the Court actions that it has engendered, that Udecott should continue to stand behind their own immunity from judicial review.

32. Udecott through Mr Calder Hart adopted a confrontational attitude to those who have taken issue with its methods and practices, particularly the JCC by its current President Mr Winston Riley. Mr Calder Hart had a similar fraught relationship with Dr Keith Rowley, former Minister with responsibility for Udecott, with whom he had particular dealings in 2003 up to Dr Rowley’s removal from office in 2008. There were, from these and other sources, numerous complaints about Udecott’s methods and practices the most significant being:
(i) Excessive and unfair uses of sole selective tendering powers contrary to free and fair competition and transparency.
(ii) Misuse or manipulation of tender and tender review procedures leading to the inappropriate and potentially corrupt award of contracts.

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