High-level engineers’ team, auditors to probe asphalt plant racket
…loss of State revenue could be substantial – Minister
Expressing concern over the potential revenue loss to the State following revelations of an alleged racket at the State-run asphalt plant, Public Works Minister Juan Edghill has revealed that Terms of Reference for an investigation have been drawn up and the probe is likely to begin shortly with a team of technical experts.
Public Works Minister Juan Edghill was at the time being interviewed by this publication on the sidelines of Parliament on Tuesday. When asked about the racket at Garden of Eden, East Bank Demerara (EBD), Edghill said that considering how long it may have been going on, the State would have been haemorrhaged of money.
“I had indicated that we would have an investigation. At this stage, I’m finalising a team. In the first instance, I thought that maybe one person might be able to go in there and bring a report. And when I examined what is taking place, I think it would be better to have a team. So that was my recommendation,” he said.
“The allegation is that this has been going on for quite a while. Years. And if this is years, then the public treasury would have been haemorrhaging as a result of this. So, it’s an allegation that needs investigating,” Edghill also explained.
In explaining the methodology of the team, Edghill noted that they would need auditors and engineers for such an extensive investigation. According to the Minister, the Terms of Reference have already been drawn up for the investigators.
“[We] have to get somebody who can do the quantities, because you’re dealing with allegations that say certain amount of asphalt was purchased for the roads and then it was resold and not used for the roads,” he informed this publication.
“So, we have to get people to assess that, an engineering type person, an auditor who can track and trace the money and somebody who is skilled in the art of investigating. And that team will come. The Terms of Reference have been worked out and that team is being finalised and as soon as that team is finalised, I will announce it. And people will be able to engage the team.”
It was revealed last week that contractors working on Government projects were being mandated to take their asphalt from the Garden of Eden plant. Upon doing that, they would then get huge discounts under a scam that allegedly stretched all the way to the Ministry of Public Works.
The reports are that persons from the Ministry would order a certain amount of asphalt from the plant to be billed to the Ministry. However, they would collect less than what was ordered, and the difference was sold at discounted prices to select contractors.
It was in July of last year that the $488 million German-made asphalt plant which was procured by the former A Partnership for National Unity/Alliance For Change (APNU/AFC) Government arrived in Guyana. The new asphalt plant was touted as having the power and capability to produce approximately 160 tonnes of asphalt per hour – almost four times faster than the asphalt plant that was in use at the time.
The new asphalt plant, which is supposed to be able to process plastic bags and bottles, was procured through public tender during 2018 by the Demerara Harbour Bridge Corporation, signalling an increase in operations and growth in demand.
When it comes to the old asphalt plant that processes bitumen and other materials, the former Government had been using its funds like a slush fund. It was revealed last year that the APNU/AFC Government took money from the DHB asphalt fund to pay Dutch company LievenseCSO for a feasibility study on the new DHB crossing.
Reports indicate that in 2017, the APNU/AFC Government used $215.3 million from the fund, while in 2018 a further $74 million was withdrawn. The original sum approved by Cabinet for the contract was $161.5 million. It is understood that the contract price for LievenseCSO, which was handpicked by the former Government to carry out the consultancy, was actually $148 million.
Then PPP Chief Whip and now Parliamentary Affairs Minister, Gail Teixeira, had written to the Public Procurement Commission (PPC) in June of 2019 to draw its attention to the misuse of the asphalt fund accounts.
PPC Chairperson Carol Corbin had subsequently referred the matter, together with the Commission’s report on LievenseCSO’s sole sourcing, to Auditor General Deodat Sharma in order for him to take the relevant action. (G3)