Millions in overpaid contracts unrecovered
September 20, 2011 | By KNews.
- Finance Ministry cites dead contractors, other challenges
The Ministry of Finance has claimed it faces a number of problems, including dead contractors, in efforts to recover millions of dollars which were handed out in overpayment to contractors.
In answer to questions posed by the Parliamentary Public Accounts Committee, the Finance Secretary has outlined a number to steps to correct the problem, such as the establishment of filed audit units, “which serve to provide the necessary technical capabilities.”
In a Treasury Memorandum tabled in the National Assembly, the Finance Secretary pointed to unrecovered overpaid sum based on questions raised by the Public Accounts Committee on the Public Accounts for the years 2007 to 2008.
In Region Three, overpayment to contractors amounted to $3.5 million. This amounted to works on the Parika Backdam Nursery School, roads and on educational buildings, and sums outstanding for between 2005 and 2006.
The Finance Secretary said that efforts aimed at the recovery of overpayments are still ongoing.
With regards to outstanding sums from 2005 to 2006, the Regional Administration has indicated that greenheart piles to the value of $2.6 million were confiscated upon the termination of the contracts awarded for the construction of bridges in Hague and Zeeburg, West Coast Demerara.
According to the Finance Secretary, the confiscated piles were utilised after new contracts were awarded for the said bridges as well as for the completion of other projects in the region.
It was noted that the cost recovered through the use of confiscated piles by the new contractors amounted to $1.1 million. The amount in overpayment in question is $2.5 million.
“It was unfortunate that the relevant records, regarding the movement of the piles, were not maintained by the then Administration,” the Finance Secretary stated.
In Region Five, the Finance Secretary stated that the Regional Administration has had significant success in the recovery of overpayment on contracts as $5.977 million or 73 percent has been recouped.
Among the overpaid contractors was the one who worked on the construction of the No. 8 Secondary School. The Regional Administration has been informed that the contractor is now deceased, and that the firm he worked for is no longer located at the last known address.
The Finance Secretary said investigations are however continuing on that.
The contractor engaged in the rehabilitation of the St John’s Street in Hopetown has also overpaid and has been written to regarding the overpayment on the contract.
According to the Finance Secretary, the contractor who was out of the country has since on his return, requested a review of the overpayment for the project.
The Regional Administration still maintains that there was no overpayment on the contracts regarding the rehabilitation of the First Cross Street – West Rosignol, Bennet Street-East Rosignol, First Cross Street-Bush Lot and Paradise Playfield Street.
The administration has since written the Auditor General to review the findings of the Regional Engineer.
Meanwhile, a number of issues related to the use of fuel in Region Ten were responded to by the Finance Secretary.
Reaching far flung areas within the Region sometimes necessitates decisions to utilise the services of other governmental as well as non-governmental agencies that traverse those locations, the Finance Secretary stated.
“It is not only a cost saving decision through the utilisation of resources other than those of the region but sometimes unavoidable,” it was noted.
Some of these locations include Kwakwani, Ituni, Mabura and Rivers View and which are accessible only through the use of certain types of mobile equipment. The items required to be transported to these locations include medical emergencies, school supplies of exercise books and school furniture.
The fuel issued to the 18 vehicles not under the control of the Regional Administration is directly related to this type of arrangement, the Finance Secretary stated.
It was noted that the Administration not only supplied the fuel to facilitate the transportation of these essential commodities to those far flung locations mentioned earlier but ensured that the relevant documentation was effected.
Such documentation included the vehicle numbers, amount of fuel, distance to be covered and foremost, that the fuel was issued via an Internal Stores Requisition. The Finance Secretary stated.
The Regional Administration has since purchased an ambulance for the Kwakwani and Ituni communities and a canter truck for the delivery of school supplies.
The Region was unable to establish its own bond for the storage of bulk fuel in keeping with the requirements of the Environmental Protection Agency and the Guyana Fire Authority. As a result of the lack of facilities to store bulk fuel, the latter is paid for and stored at several gas stations located as far as Kwakwani.
The Finance Secretary stated that the fuel is uplifted through the use of Internal Stores Requisitions (ISR) and Stores Slips. The records are updated weekly from the Stores Slips as well as Slips from the gas stations and its reconciliation verified by the designated Field Auditor of Region Ten.
HOW DO YOU OVERPAY CONTRACTORS IN THE FIRST PLACE ?
September 20, 2011 | By KNews.
- Finance Ministry cites dead contractors, other challenges
The Ministry of Finance has claimed it faces a number of problems, including dead contractors, in efforts to recover millions of dollars which were handed out in overpayment to contractors.
In answer to questions posed by the Parliamentary Public Accounts Committee, the Finance Secretary has outlined a number to steps to correct the problem, such as the establishment of filed audit units, “which serve to provide the necessary technical capabilities.”
In a Treasury Memorandum tabled in the National Assembly, the Finance Secretary pointed to unrecovered overpaid sum based on questions raised by the Public Accounts Committee on the Public Accounts for the years 2007 to 2008.
In Region Three, overpayment to contractors amounted to $3.5 million. This amounted to works on the Parika Backdam Nursery School, roads and on educational buildings, and sums outstanding for between 2005 and 2006.
The Finance Secretary said that efforts aimed at the recovery of overpayments are still ongoing.
With regards to outstanding sums from 2005 to 2006, the Regional Administration has indicated that greenheart piles to the value of $2.6 million were confiscated upon the termination of the contracts awarded for the construction of bridges in Hague and Zeeburg, West Coast Demerara.
According to the Finance Secretary, the confiscated piles were utilised after new contracts were awarded for the said bridges as well as for the completion of other projects in the region.
It was noted that the cost recovered through the use of confiscated piles by the new contractors amounted to $1.1 million. The amount in overpayment in question is $2.5 million.
“It was unfortunate that the relevant records, regarding the movement of the piles, were not maintained by the then Administration,” the Finance Secretary stated.
In Region Five, the Finance Secretary stated that the Regional Administration has had significant success in the recovery of overpayment on contracts as $5.977 million or 73 percent has been recouped.
Among the overpaid contractors was the one who worked on the construction of the No. 8 Secondary School. The Regional Administration has been informed that the contractor is now deceased, and that the firm he worked for is no longer located at the last known address.
The Finance Secretary said investigations are however continuing on that.
The contractor engaged in the rehabilitation of the St John’s Street in Hopetown has also overpaid and has been written to regarding the overpayment on the contract.
According to the Finance Secretary, the contractor who was out of the country has since on his return, requested a review of the overpayment for the project.
The Regional Administration still maintains that there was no overpayment on the contracts regarding the rehabilitation of the First Cross Street – West Rosignol, Bennet Street-East Rosignol, First Cross Street-Bush Lot and Paradise Playfield Street.
The administration has since written the Auditor General to review the findings of the Regional Engineer.
Meanwhile, a number of issues related to the use of fuel in Region Ten were responded to by the Finance Secretary.
Reaching far flung areas within the Region sometimes necessitates decisions to utilise the services of other governmental as well as non-governmental agencies that traverse those locations, the Finance Secretary stated.
“It is not only a cost saving decision through the utilisation of resources other than those of the region but sometimes unavoidable,” it was noted.
Some of these locations include Kwakwani, Ituni, Mabura and Rivers View and which are accessible only through the use of certain types of mobile equipment. The items required to be transported to these locations include medical emergencies, school supplies of exercise books and school furniture.
The fuel issued to the 18 vehicles not under the control of the Regional Administration is directly related to this type of arrangement, the Finance Secretary stated.
It was noted that the Administration not only supplied the fuel to facilitate the transportation of these essential commodities to those far flung locations mentioned earlier but ensured that the relevant documentation was effected.
Such documentation included the vehicle numbers, amount of fuel, distance to be covered and foremost, that the fuel was issued via an Internal Stores Requisition. The Finance Secretary stated.
The Regional Administration has since purchased an ambulance for the Kwakwani and Ituni communities and a canter truck for the delivery of school supplies.
The Region was unable to establish its own bond for the storage of bulk fuel in keeping with the requirements of the Environmental Protection Agency and the Guyana Fire Authority. As a result of the lack of facilities to store bulk fuel, the latter is paid for and stored at several gas stations located as far as Kwakwani.
The Finance Secretary stated that the fuel is uplifted through the use of Internal Stores Requisitions (ISR) and Stores Slips. The records are updated weekly from the Stores Slips as well as Slips from the gas stations and its reconciliation verified by the designated Field Auditor of Region Ten.
HOW DO YOU OVERPAY CONTRACTORS IN THE FIRST PLACE ?