THE transport ministry rejected a plan by the Roads Authority to extend three road contracts valued at N$1,6 billion to three companies without publicly advertising the tenders.
Currently, there are three highways under construction – the Swakopmund to Walvis Bay, the Windhoek to Hosea Kutako and the Windhoek to Okahandja.

The Swakopmund to Walvis Bay highway is being constructed by Chinese-owned company Unik Construction Engineering Namibia and its Namibian partner, Thohi Construction for N$958 million.

The N$1 billion contract for the contruction of a section of the Windhoek to Okahandja highway was awarded to the Italian construction company CMC and their Namibian partner Otesa Civil Engineering, while another N$1 billion contract for the Windhoek to Hosea Kutako highway went to the China Railway Seventh Group and Onamagongwa Trading Enterprise.

Two of the highways – Windhoek to Hosea Kutako and Windhoek to Okahandja – are supposed to be completed by January 2019, while the Swakopmund to Walvis Bay highway should be done by June next year.

Works and Transport permanent secretary Willem Goeiemann asked the RA last year to present a strategy on how the parastatal plans to implement the three projects to meet deadlines.

RA chief executive Conrad Lutombi wrote to Goeie­mann on 2 February 2018, recommending that the three companies which are currently constructing the highways should be given extensions to work on the next kilometres, which would rule out advertising the tenders.

According to the Roads Authority (RA), the Windhoek to Hosea Kutako International Airport road would be extended by three kilometres at a cost of N$150 million, while the Swakopmund to Walvis Bay road will increase by eight kilometres for N$435 million. The Windhoek to Okahandja road would be extended by 21 kilometres for a whopping N$1 billion.

The RA stated that the three road extensions would cost a combined N$1,6 billion, and that allowing continuity would save the government N$147 million.

The savings, according to the parastatal, include the fact that the companies would not need to set up a new construction camp. The camp consists of workers’ accommodation.

THE LOW ROAD

Works deputy minister Sankwasa James Sankwasa, however, rejected this proposal to extend the roads, and blasted the RA for accepting inflated tenders.

Sankwasa rejected the proposal in two letters he wrote to works minister John Mutorwa and Goeiemann on 27 February and 2 May 2018.

“I am not in a position to agree with the recommendations to award the extensions of construction work to the existing tenderers,” he said, suggesting that the RA should instead go for a public tender, supervised by the ministry of works.

“Should any tenderer not quote within the confines or rates of the Southern African Development Community (SADC) region, the government should reject such tender,” he emphasised.

According to him, Namibian road projects, compared to other southern African countries, are expensive.

The deputy minister said he researched Namibian road construction costs compared to other countries, mainly Zambia, Botswana, Zimbabwe and South Africa.

“I discovered that nearly all SADC countries construct roads of bitumen (tar) standards at approximately N$5 million to N$8 million per kilometre, depending on the topography of the area where the road is being constructed,” he said.

The deputy minister further said that about 10 years ago, Namibia was constructing roads at an average cost below N$5 million per kilometre.

“This seems to have changed overnight, to where Namibia is constructing at the cost of N$12 to N$15 million per kilometre,” he added.

The three roads are priority projects under the Harambee Prosperity Plan, President Hage Geingob’s signature development plan, which has promised better roads up to 2020.

“Does government have to undertake overpriced projects because they are Harambee projects?” the deputy minister asked.

“The sudden escalation in the costs of road construction and all other construction works in Namibia requires an urgent investigation, and the halting of such overpricing practices”, he stressed.

For instance, Sankwasa said the Swakopmund to Walvis Bay road was overpriced by around N$60 million, compared to the initial cost government budgeted for.

The deputy minister said he objected to the awarding of the Swakopmund to Walvis Bay road tender in April 2016 when he indeed recommended its cancellation and re-advertisement.

“I clearly stated that this tender was riddled with corruption, and should be cancelled and be re-advertised. But such recommendation was brushed aside, and the tender was eventually awarded to the third most expensive tenderer, Unik, instead of the cheapest and the best tenderer, as evaluated by the consulting engineer,” he added.

Sankwasa told The Namibian this week that he planned to intervene in the current tenders as they were overpriced, and he wanted the permanent secretary to correct the matter.

“As permanent secretary, I expect him [Goeiemann] to act in the public interest of the country and a duty to protect state resources,” he reiterated.

Sankwasa suggested that if the material is too expensive, then why not get material from another source that’s cheaper.

“It just boils down to corruption,” he charged.

NOTHING WRONG

RA chief executive Lutombi told The Namibian yesterday that they are aware of Sankwasa’s concerns, but denied that they committed the government to overpriced roads contracts.

“All the tenders that were awarded, of all current projects, went through a competitive advertised tender process. Hence, all the tenders were awarded regarding the price and technical expertise in line with the Roads Authority’s procurement process,” he said.

Lutombi further stated that they responded to Sankwasa’s letter with a detailed report on the cost of the dual-carriage freeways versus single carriageways.

The ministry of works then submitted their proposal to the Central Procurement Board (CPB) for scrutiny, and for the board to indicate whether it was done legally.

“We are still waiting for a response from the CPB,” he said.

Lutombi added that the risks of going for underpriced contracts include poor quality, and the project not being completed on time.

The RA advertised in newspapers last week for a consultant to carry out a study on road construction prices.

The three highways have a controversial past.

The Namibian reported in 2016 that the RA and the ministry of works committed the government to contracts of more than N$2 billion without following procedures, and claiming that they were made a priority by “the highest offices”.

The N$2 billion will have to be paid over two years, but the finance ministry, already under pressure from massive cash shortages, was forced to find N$800 million to pay road construction companies.

Source – Namibian

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Source: Bitumenexporter

Over Priced Road Contracts