– Govt criticised for contracting company
In light of Fedders Lloyd Corporation Limited being pulled from the Specialty Hospital Project (SHP) after it 
was blacklisted over fraud and corruption practices by the World Bank, the A Partnership for National Unity/Alliance For Change (APNU/AFC) Coalition has come under fire for bypassing the transparent process to handpick the India-based company to complete the project.
In November last, Government signed a Memorandum of Understanding (MOU) with Fedders Lloyd – one of the original bidders in 2012 – to construct the facility. The coalition had explained that in the interest of time and without any tendering process, it approached Fedders Lloyd, which was willing to complete and fully equip the medical facility with the remaining US$13.8 million of the US$18 million Line of Credit from the India Exim (Export-Import) Bank.
However, in April last the New Delhi-based company was blacklisted by the World Bank under its fraud and corruption policy as set forth in the Bank’s Procurement Guidelines or the Consultant Guidelines.
According to the World Bank’s website, the company has been sanctioned from April 6, 2016 to April 5, 2020 for breaches of the institution’s procurement guidelines in 2004 and in 2010. The guideline, 1.14(a)(ii), under the heading ‘Fraud and Corruption’ states “fraudulent practice is any act or omission, including a misrepresentation, that knowingly or recklessly misleads, or attempts to mislead, a party to obtain a financial or other benefit or to avoid an obligation.”
Further examination of the World Bank’s notes on the debarred firms and individuals, it explained the company will have to adhere to certain conditions during the period of sanctioning before it can be allowed to work on projects financed by the institution.
“The period of ineligibility of Fedders Lloyd Corporation Limited extends to any legal entity that they directly or indirectly control. The company is ineligible to be awarded Bank-financed contracts for a period of four years. At the end of the Period of Debarment, the Respondent and the Sanctioned Affiliates may be released from debarment, provided that they have met corporate compliance conditions, cooperated with the WBG (World Bank Group) and fully complied with the terms of the NRA,” the report on the Bank’s website details.
This situation has opened the floor for mounting criticisms against the Guyana Government over its selection of the company despite objections from various sections of society. Leading those protestations of the contract being awarded to Fedders Lloyd, was the People’s Progressive Party/Civic (PPP/C) Opposition which had contended that the company was never the second best bidder in the tendering process in 2012, as claimed by the coalition.
In fact, the party had disclosed that the company was disqualified because of certain inconsistencies in its submission to the local Tender Board, a report which the current government contended was a lie.
Speaking with Guyana Times on Saturday, an inside source of the PPP/C pointed out that had government considered the advice and warnings from the Opposition, this situation would not have arisen and the project would have avoided further delays.
The party source explained that there were attempts by government to use a PPP evaluation, that they had always claimed was corrupt, and misrepresent that evaluation to justify the award of this contract.
The PPP official further noted that in effect, the coalition administration had single-sourced the contractor. The Opposition party source further alleged that government’s decision may have been influenced by the fact that the company had financed the party as well as individuals.
Fedders Lloyd is said to have close ties with Public Security Minister Khemraj Ramjattan, who had legally represented the company back in 2012 when it claimed that it was cheated out of the contract to build the Specialty Hospital.
At the time when the contract was awarded to the India-based company, political commentators Ramon Gaskin and Dr Henry Jeffery were vocal over the lack of transparency surrounding the new arrangements for the construction of the controversial Specialty Hospital.
When contacted on Saturday, they noted they are not surprised at the fact that the contracting firm has been sanctioned by the World Bank especially since there was complete lack of transparency in the award of the contract to it.
Gaskin told this newspaper that Fedders Lloyd is no good in the interest of Guyana; just as the first India-based company, Surendra Engineering, was not.
“Surendra was no good – we had a lot of problems with them in terms of money – and Fedders Lloyd is no better… These foreign contractors are bad news,” he asserted.
The political commentator posited that Ramjattan had pushed for government to use the Fedders Lloyd because it is “his people” and so they went ahead without undergoing the proper procedure.
“Fedders Lloyd should not have been allowed to go ahead even after Surendra pulled out because that whole tendering should have been done all over again,” Gaskin stated.
On the other hand, Dr Jeffery outlined that it was unfortunate that foreigners had to become involved in the matter for the right thing to happen. “People have been saying that the contract should have gone to open tender but government failed to do so,” he said.
Nevertheless, Dr Jeffery noted that Guyana wins in that the project will now rightfully go to tendering and this should be a lesson learned for the coalition government.
Both political commentators also underscored the need for the APNU/AFC administration to take steps to have the Public Procurement Commission established.
