Those poorly executed contracts

For the second time in the space of three years the government has had to terminate the contract for a major project.  And the targets of these terminations were the subjects of serious objects even before they signed the contracts. And both contractors failed to secure a performance bond in the event of the government having to recover monies paid ahead of the project. The first of these was Synergy Holdings headed by Makeshwar ‘Fip’ Motilall. He was contracted to build the road to the Amaila hydroelectric falls to facilitate the construction of the dam site and the hydro station. When the contract was announced there were numerous questions, among them the ability of the contractor to finish the project in the stipulated time and for the cost of US$18.4 million. This was the road that had to be designed and built by the contractor. Winston Brassington, head of the National Industrial and Commercial Investment Limited—NICIL—, called a press conference to proclaim the skills and virtue of Synergy Holdings. This was an entity that had never built a roadway in any part of the world. But such was the determination on the part of the government to award the contract to Motilall that logical arguments were ignored. For example, when reporters pressed Brassington to identify roads built by Synergy Holdings, all he would say was that these were constructed in the United States—in Florida. But the Florida Department of Transportation had no record of Synergy Holdings or Makeshwar Motilall ever constructing a road anywhere in the state or in the country. There was no due diligence by the government. Instead, Brassington said that any due diligence had to be conducted by the entity that was giving the performance bond. Strange as this may seem, the performance bond expired and the company, Hand in Hand Insurance Company declined to renew the bond. Guyana seems to be in the mould of poor countries, accepting whatever is pushed at it without proper inspection. And this is not due to complacency; it may be due to the fact that Guyana wants these projects badly and is prepared to bend the rules. Reporters were accused of seeking to destroy a legitimate contractor when they criticised Synergy Holdings and Makeshwar Motilall. Immediately the government offered Motilall maximum protection. Even when he imported his road-building equipment the government did its all to keep the pieces of equipment away from the prying eyes of the media. But there was no escaping the fact that the equipment was used. Motilall began the work and as expected, he did not make the kind of headway demanded by the contract, even when the government modified the contract in the face of inclement weather and the like. There was a question of the performance bond which the government never opted to check. The government did not even undertake a due diligence. In the end President Donald Ramotar pulled the contract and sent Motilall packing. This week, a similar situation arose and once more the government was forced to pull the contract. This time the contractor was the Indian company, Surendra Engineering Company Limited.  As was the case of Motilall, the performance bond was non-existent. Motilall’s was not renewed while the one Surendra offered was forged. The parliamentary opposition was not enamoured with the concept of a specialty hospital.  The parliamentarians were quick to recognize that although the Guyanese taxpayers were contributing to the construction of the hospital, many of them would not have been able to afford the service. Guyana should have known better to award a contract to Surendra.  More than two years ago the company won a contract to provide some irrigation pumps. A cloud still hangs over the supply of the pumps although hard earned money was paid to the Indian company. Attorney General Anil Nandlall has said that the government may have to review the other contracts it may have with Surendra Engineering. This is rather surprising given that the very government says that it is contemplating blacklisting Surendra Engineering.