Govt will not be bullied into paying for unfinished projects

Works on the Conversation Tree road project [File photo]

Contractors and vendors providing service to the Government of Guyana through the = Public Works Ministry are warned against any attempt to bully, and or manipulate the government into paying for incomplete projects.                                                                                                                                                                  Full statement below:

In an article published in the Monday, October 9, 2023, edition of Stabroek News, Contractor Sattrohan Maraj of S Maraj Contracting Services alleged that work on the Leguan Stelling has been stalled due to outstanding money owed to him by the Government.

The Ministry category refutes this claim.

Truthfully, the government would like nothing better than to finally put behind its back, this inherited mismanaged project, a slap-in-the-face and illicit act against taxpayers.

Under the direction of the then Minister of Public Infrastructure, David Patterson, a contract totalling $413,259,260.00 was signed to complete the six (6) months project, with the contractor receiving up to $199,435,000 in payments which amounted to about 50% of the contract sum at the time, and yet the project was still incomplete a year after.

Contracts usually provided a 15% advance payment for work to get started, however, under the APNU+AFC government there was a clear disregard for the procurement practices and a clear breach of the Fiscal Management Accountability Act.

This corrupt and poorly managed project which was expected to be completed by June 7, 2019, remains a thorn in the side of the government today, with a contractor trying to extort money, even as only 2% of the work is said to be remaining on the project.

The Ministry notes that this particular contractor has manifested opportunism throughout the execution of this contract, utilising perceived deficiencies and ambiguities in the bill of quantities, as a basis for making claims for additional payments for the execution of aspects of works.

These include claims for additional payment for activities that are inherent to the execution of the works, and which are typically catered for in the bill rates at the bidding phase. Two notable examples that have had significant financial implications on the Contract are (1) the Contractor’s claim for additional payment for clearing the riverbed at the project site of obstacles prior to driving the prestressed concrete piles for the stelling, and (2) the claim of additional payment for cutting of prestressed concrete piles to the design cutoff level after driving.

The Ministry wishes to note that the Transport and Harbours Department (T&HD) which is responsible for all stellings has sought amicable resolution to the Contractor’s claims and has negotiated reasonable settlements with the Contractor.

A total of ten (10) variation orders have been resolved under the contract to date, with the Contractor being fully compensated in accordance with negotiated agreements.

These were addressed under Addendum No.1 which was ratified between the Contractor and T&HD in December 2022. The Contractor’s assertion that the Ministry is reluctant to resolve legitimate claims under the contract is therefore dishonest.

Further, in a negotiation meeting convened prior to the ratification of Addendum No.1, the Contractor gave a commitment to completing the project expeditiously (prior to the June 5, 2023 deadline) and within the revised contract sum of $6o7,259,260.00. The Contractor has failed to deliver the project in harmony with this commitment.

Additionally, the Contractor has deliberately delayed the execution of works at a critical juncture in the project execution when the linkspan bride installation is required to complete the major infrastructure works on the project.

There is currently no impairment to the Contractor installing the linkspan bridge. The T&HD has processed payments due to the Contractor to provide the cash flow needed to execute this outstanding aspect of the works.

This project is currently three (3) months over the contract completion date stipulated in Addendum No.1 (i.e. June 5, 2023).

The Transport and Harbours Department has issued multiple directives to the Contractor regarding the completion of the linkspan bridge installation in accordance with the Contract requirements. Outstanding claims for payment to the contractor will be resolved in accordance with the provisions of the Addendum.

The Contractor’s failure to fulfill the outstanding project obligations as directed by the Ministry will result in the application of recourse and compensatory provisions for nonperformance in accordance with the Contract and national procurement framework.