Saturday 20th Jul 2024
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Civil Court

Issue on Awarding Projects at MVR 21 Million Loss for State Filed at Civil Court

Matters involving the awarding of projects at a loss of MVR 21,636,931.20 for the state have been presented to the Civil Court.
A press release from Advocacy Chambers (AC) read that bidding processes announced for three projects in a joint venture with SJ Trade Pvt Ltd and SJ Construction Pvt Ltd were awarded to companies against the policies on the bidding documents and against the state’s Public Finance Regulation.
AC claimed that while the National Tender Board has evaluated and awarded the bids for the three projects, the agreement for one of the projects has been signed.

Projects awarded at a loss for the state treasury

  • 1. Project involving the completion of 100 housing units being constructed in Hanimaadhoo, Haa Dhaal Atoll. The bidding process was announced on January 27.
  • 2. Project involving the completion of 64 housing units being constructed in Vilufushi, Thaa Atoll, and the design and build procurement of 36 new units. The bidding process was announced on February 2.
  • 3. Project involving the completion of 100 housing units being constructed in Nolhivaranfaru, Haa Dhaal Atoll. The bidding process was announced on February 15.
Out of all the bidders, SJ presented the lowest responsive bid.
The National Tender board claimed that the bids were not awarded after evaluation as SJ’s bid did not meet the employer’s requirement or financial requirement noted on the document.
SJ, unable to accept the board’s decision, reported the issue to the Ministry of Finance’s Procurement Officer in accordance with 17.09 of the Public Finance Regulation.
According to the Public Finance Regulation’s 17.09 (b) (3), the Procurement Officer is mandated to conclude the issue and produce a written document of their method to the party that made the request within 14 business days.
AC stated that the Procurement Officer has not informed them of any decisions or steps taken against the matters reported apart from the unlawfully awarded Vilufishi, Thaa Atoll project.
The Bid Committee’s review revealed that SJ’s bids did meet the employer’s requirement and financial requirement dictated in the bidding documents. Therefore, SJ’s bid should have been included in the evaluation.
It is worth noting that the bidding documents state that after evaluation, the bid must be awarded to the lowest responsive bid. 10.51 (a) of the Public Finance Regulation reads that the best tender must be chosen according to the standards dictated on the document.
As the review committee has declared that SJ’s bids are responsive bids, the documents prove that SJ presented the lowest rate for all three projects.
AC stated that it is the Finance Minister’s responsibility to resolve the issue without incurring a loss to the state treasury and without violating the bidders’ rights. Additionally, AC mentioned that the matter was brought to the ministry’s attention on July 16 as there is a greater chance of the state facing losses if the issue is presented to a court of law.
However, as the matter has not been adequately resolved, AC has presented the case to the Civil Court.