Government procurement agencies need cleansing - Mukanga
By Chiwoyu Sinyangwe and Simeon Gboun
Sat 16 June 2012, 13:25 CAT
ALL government agencies and ministries dealing in procurement processes need cleansing to achieve efficiency and rid them of corruption, says works and supply minister Yamfwa Mukanga.
On Thursday, Vice-President Dr Guy Scott said the Road Development Agency (RDA) and the Zambia Public Procurement Authority (ZPPA) need cleansing and panel beating to improve on delivery of projects, especially in the road sector.
But sources say RDA does not have the capacity to effectively procure road works worth K4.2 trillion planned for this year following the dismissal of the entire procurement team last year in November by executive director Dr Michael Mulenga.
Vice-President Scott complained in Isoka that institutions like RDA and ZPPA did not seem to be up and carrying on working.
"There seems to be a lot of foot dragging going on inside these institutions and I think they need cleansing," said Vice-President Scott. "They need panel beating because the money is there...we don't want to open the door to corruption…to single-sourcing but at the same time we want to make the system work, that's the challenge that we have."
Reinforcing Vice-President Scott's concerns, Mukanga said there was need for government procurement agencies to work freely and transparently to be accountable to the nation.
"It is not only these institutions that require cleansing. I would like to extend this to all government agencies and ministries dealing in procurement processes," Mukanga said yesterday when he officiated at the RDA-organised "Roads Indaba" at Intercontinental Hotel in Lusaka yesterday.
Mukanga said it was time for all officers involved in procurement procedures to start declaring their interests in companies they own.
"Even as RDA, declare your interest in the companies you own so that we know that you own a company; you own this and you own that company so that when time comes for giving out contracts, it will be done transparently and it will be better because we will see a situation where people will definitely become almost corrupt-free," he said.
"That is the cleansing we are talking about. This perhaps will help us to work transparently and free; and corrupt-free in the issuance of contracts. It will definitely reduce the corrupt tendencies that people have been talking about. We need to point figures, not at others, but ourselves and see how best we can contribute to the change of the environment."
Mukanga said the government would not tolerate sub-standard performance among contractors in the road sector.
"Government will not sit back and see its coffers being depleted without corresponding progress in infrastructure development," said Mukanga. "Government is ready to reward quality delivered projects and will deal swiftly and decisively with poor performers. It cannot be business as usual, we are in a hurry to see that there is progress."
Earlier, Dr Mulenga said RDA was concerned about the performance of some contractors and consultants.
"Our major concern is the workmanship in some road projects," said Dr Mulenga. "We believe that the presentations during the Roads indaba will greatly help in refocusing ourselves to the funders, the government and people of Zambia…"
And sources within ministry of works and supply said RDA currently had "serious procurement bottlenecks".
"The guys who knew and understood how to draw tender documents have all been fired and right now, RDA has a backlog of works that need to be procured but the questions is 'who is going to draw up the tender documents?' I wonder how the government is going to expend K4.2 trillion planned for this year," said the sources.
In November 2011, Dr Mulenga fired more than 15 senior and junior officers in the procurement department without giving any reason for the massive terminations.
Labels: CORRUPTION, PROCUREMENT SYSTEMS, RDA, ZPPA
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RDA, ZPPA need cleansing - Scott
By Moses Kuwema in Isoka
Fri 15 June 2012, 13:25 CAT
VICE-President Dr Guy Scott says the Road Development Agency (RDA) and the Zambia Public Procurement Authority (ZPPA) need cleansing and panel beating.
Vice-President Scott's comments come in the wake of revelations by the provincial administration in Muchinga Province that funds for various works for the province were readily available but that the bureaucracy surrounding the procurement process was hampering implementation.
Vice-President Scott observed that there was a lot of foot dragging which was going on in the two institutions.
"The institutions like Road Development Agency, like Zambia Public Procurement Authority and so forth, don't seem to be up and carrying on working. There seems to be a lot of foot dragging going on inside these institutions and I think they need cleansing. They need panel beating because the money is there. Muchinga Province has not been deprived of money, what it has been deprived of is the administrative get up and go. We don't want to open the door to corruption…to single sourcing but at the same time we want to make the system work, that's the challenge that we have," Vice-President Scott said when he featured on a special programme on Iso FM yesterday.
And Vice-President Scott said the Farmer Input Support Programme and the maize buying programme of the Food Reserve Agency were extremely corrupted.
Vice-President Scott cited an example of Chama where three quarters of the maize that was bought and sold in the district came from neighbouring countries such as Malawi and Tanzania.
"…200, 000 tonnes of fertiliser went into the rural areas and where is it? It's all been rounded up by the smugglers and the traders and commercial farmers. Likewise for maize, the reason it is paid for late is that the money is being taken by the big people," he said.
He said there was need to clean up the system so that it could serve the small farmers.
"Zambia is a very corrupt place but the maize and fertiliser system is so corrupt. Once we have got the system under control, that's when we can fulfill our campaign promises of 10 bags of fertiliser. This system if it is not clean then we will break down," Vice-President Scott said.
And Vice-President Scott said the maize-buying exercise would commence in the next two weeks.
And featuring on the same programme, Muchinga Province minister Malozo Sichone said the Chinese contractor who built the Tazara railway was the same one who would be working on the Chama-Matumbo road and estimated the contract sum at K400 billion.
Labels: GUY SCOTT, RDA, ZPPA
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Government negotiates with Gunvor, Trafigura
Government negotiates with Gunvor, Trafigura
By Kabanda Chulu
Tue 29 May 2012, 13:28 CAT
ZAMBIAN security wings carried out intensive investigations over concerns about corrupt and unsound environmental practices by preferred bidders engaged in negotiations for the supply of fuel, says energy permanent secretary George Zulu.
And Zulu justified the presence of PF cadres like Willie Nsanda and other stakeholders who sat on the fuel procurement evaluation committee "because they were Zambians with the interest of the country at heart".
Announcing the Zambia Public Procurement Authority (ZPPA)'s recommendation for the government to enter into negotiations with Swiss based Russian oil supplier, Gunvor and Netherlands-based Trafigura for the US$100 million two-year supply and delivery of 1,440,000 metric tonnes of petroleum feedstock and 216,920,000 litres of diesel and 21,230,000 litres of unleaded petrol, respectively, Zulu yesterday said negotiations with the preferred bidders will take 10 days.
On the part of crude oil, Gunvor had the lowest bid, a company trading approximately 1,000,000 barrels per day - more than what Zambia consumes per month.
"It is the intention of government through the Ministry of Energy to ensure that the best supply terms are adopted during the negotiations and it should be noted that invitation for negotiations does not mean award of contract and we shall try to settle for reasonable prices so that the country can have cheaper fuel rates," he said.
"Inquiries were sent out by our security wings to look at concerns like that of corruption and environmental management by the preferred bidders and they have not done anything illegal in Zambia, for instance, Trafigura's subsidiary BP or Puma Energy, we have had no problems with them and they have been cleared because they have done nothing wrong in Zambia."
He said the government will strive to undertake the engagement of oil suppliers in a transparent manner considering that petroleum business is associated with corruption.
"We shall fight corruption in this matter and this is why we included various stakeholders in the evaluation committee and we had people from the security wings, private sector and Mr Willie Nsanda because he is a Zambian and as a transporter he has the interest at heart of the country and we are thankful to the media for keeping us in check but this whole process has undergone an objective, comprehensive and open evaluation process," Zulu said.
He said the forthcoming oil procurement might not be funded by the PTA Bank which has been issuing letters of credit over the last two years since the collapse of the deal with Stanbic Bank that was supposed to finance the purchase.
"Government is looking for other alternatives and these options of financing will be part of the negotiations," said Zulu. "Upon approval of satisfactory negotiations by ZPPA, the ministry may be authorised to award contracts but offers for award of contracts will be first sent to the preferred bidders and thereafter contracts approved by the Attorney General will be signed by government and suppliers."
Labels: ARMED FORCES, OIL, ZPPA
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K2 trillion lost in corrupt oil procurement deals-Kabimba report
TIME PUBLISHED - Tuesday, April 10, 2012, 2:35 pm
The Commission of Inquiry constituted to investigate the operations of the Energy Regulation Board and the procurement of crude oil has revealed that from 2007 to 2011 the country lost about K2 trillion through acts of malpractices in the procurement system.
Commission chairperson Wynter Kabimba says the alleged corruption in the oil procurement system involved officials from the Zambia Public Procurement Authority (ZPPA) the Ministry of Energy and the ERB.
Mr. Kabimba noted that the commission also learnt that the companies that were allegedly corruptly engaged in the procurement oil have since bid again for a tender to supply fuel.
Mr. Kabimba has since recommended that the officers allegedly involved in corrupt activities be brought to book.
Another commission of inquiry tasked to investigate the installation of a Radar system at the Kenneth Kaunda Airport noted that the ministry of communication and transport interfered in the awarding of the contract by quashing the contract that had already been finalized by the ZPPA and given to Thales Air Systems of South Africa.
Commission chairman Sebastian Zulu has since recommended that the contract awarded dubiously awarded to Salex an Italian Company.
And President Michael Sata in commenting on the reports presented to him noted that they were too technical and directed the Secretary to the Cabinet to institute a technical committee that will prepare a cabinet memo to allow the government to study and come up with a decision on the matter.
Meanwhile President Sata has sworn-in Pastor Godfridah Sumaili, Dr. Steven Moyo and Irene Lamba as ACC commissioners and deputy Director General of the ACC respectively.
The president has also sworn-in veteran broadcaster Frank Mutubila as the Zambia’s ambassador to Italy while Ogeon Gondwe is the new senior private secretary for State house.
[QFM]
Labels: ERB, OIL, PROCUREMENT SYSTEMS, WYNTER KABIMBA, ZPPA
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Some companies shortlisted for supply of oil are corrupt - Lifuka
By Kabanda Chulu and Bright Mukwasa
Wed 11 Apr. 2012, 13:30 CAT
THE fight against corruption will become a mockery if government goes ahead to consider bids for the supply and delivery of fuel products from companies associated with unethical business practices, says Reuben Lifuka.
The Ministry of Mines, Energy and Water Development through the Zambia Public Procurement Authority (ZPPA) has shortlisted 13 companies for the supply and delivery of 216,920,000 litres of diesel and 21,230,000 litres of unleaded petrol.
"We expressed dissatisfaction with the last procurement process which was fraught with allegations of impropriety from senior government officials at the time. Oil supply contracts are usually large contracts which provide opportunities for bribery and kickbacks if necessary measures to run an open and transparent procurement of suppliers are not put in place," Lifuka said.
"We are aware that some of the companies which have been shortlisted, are associated with some individuals who government is pursuing for alleged corrupt activities. It will be a mockery of the whole corruption fight if government went ahead to consider bids from companies associated with unethical business practices. Government should in fact demand that all companies bidding for this contract demonstrate that they have strong anti-corruption measures in place to curb bribery, kick backs and all forms of corruption, in their entire supply chain."
He explained that Zambia was struggling with high pump prices for fuel and if not addressed, the bribery that occurs at the procurement stage was a cost that will eventually be passed on to the public.
"Government, in its desire to lower the fuel prices, can play a meaningful role by ensuring that all opportunities for corruption in the procurement process are eliminated. All companies with tarnished reputations should be blacklisted; this is a standard practice for whitewashing procurement systems in the world," said Lifuka.
"We are taking a keen interest in this procurement process and we have initiated a procurement watch process in order for us to provide necessary checks and balances for the benefit of the Zambian people. We are also doing everything possible, in our own small way, in conjunction with a number of sister chapters throughout the Transparency Movement, to do background checks on the companies that have been shortlisted. This is in an effort to ensure that only deserving companies get the government contract to supply oil to this country."
Labels: CORRUPTION, OIL, REUBEN LIFUKA, ZPPA
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Some companies shortlisted for supply of oil are corrupt - Lifuka
By Kabanda Chulu and Bright Mukwasa
Wed 11 Apr. 2012, 13:30 CAT
THE fight against corruption will become a mockery if government goes ahead to consider bids for the supply and delivery of fuel products from companies associated with unethical business practices, says Reuben Lifuka.
The Ministry of Mines, Energy and Water Development through the Zambia Public Procurement Authority (ZPPA) has shortlisted 13 companies for the supply and delivery of 216,920,000 litres of diesel and 21,230,000 litres of unleaded petrol.
"We expressed dissatisfaction with the last procurement process which was fraught with allegations of impropriety from senior government officials at the time. Oil supply contracts are usually large contracts which provide opportunities for bribery and kickbacks if necessary measures to run an open and transparent procurement of suppliers are not put in place," Lifuka said.
"We are aware that some of the companies which have been shortlisted, are associated with some individuals who government is pursuing for alleged corrupt activities. It will be a mockery of the whole corruption fight if government went ahead to consider bids from companies associated with unethical business practices. Government should in fact demand that all companies bidding for this contract demonstrate that they have strong anti-corruption measures in place to curb bribery, kick backs and all forms of corruption, in their entire supply chain."
He explained that Zambia was struggling with high pump prices for fuel and if not addressed, the bribery that occurs at the procurement stage was a cost that will eventually be passed on to the public.
"Government, in its desire to lower the fuel prices, can play a meaningful role by ensuring that all opportunities for corruption in the procurement process are eliminated. All companies with tarnished reputations should be blacklisted; this is a standard practice for whitewashing procurement systems in the world," said Lifuka.
"We are taking a keen interest in this procurement process and we have initiated a procurement watch process in order for us to provide necessary checks and balances for the benefit of the Zambian people. We are also doing everything possible, in our own small way, in conjunction with a number of sister chapters throughout the Transparency Movement, to do background checks on the companies that have been shortlisted. This is in an effort to ensure that only deserving companies get the government contract to supply oil to this country."
Labels: CORRUPTION, REUBEN LIFUKA, ZPPA
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Dora's directive to cancel radar tender was irregular - ZPPA
By Mwala Kalaluka
Tue 20 Dec. 2011, 13:58 CAT
THE Zambia Public Procurement Authority (ZPPA) says former communication minister Dora Siliya's directive to Dr Eustern Mambwe to cancel a radar system tender awarded to Thales Air Systems SA was irregular.
Submitting to the Sebastian Zulu-chaired Commission of Inquiry on the contract for the supply, delivery, installation and commissioning of the Zambia Air Traffic Management Surveillance Radar System ZATM-RADAR at two international airports, ZPPA director general Samuel Chibuye said Siliya acted out of her jurisdiction.
This was during a hearing at Lusaka's Mulungushi International Conference Centre yesterday morning.
Chibuye said Dr Mambwe, who was the permanent secretary in the ministry, in a letter dated November 6, 2008 sought ZPPA's authority to award the ZATM-RADAR contract to Thales Air Systems SA at a tender sum of 9,050,168.00 Euros about K47 billion.
Chibuye said the Central Tender Committee at its meeting of December 5, 2008 granted Dr Mambwe authority to award the contract to Thales Air Systems SA at the above-mentioned sum including a four-month delivery period.
"However, on 6 January 2009, the controlling officer, ministry of communications and transport wrote to the ZNTB stating that he had been directed by the honourable minister of communications and transport to cancel the tender and re-invite it to be only open to manufacturers of radars and not middle men," Chibuye said.
At this point Zulu asked Chibuye if Siliya had the authority to direct the ZPPA to cancel the tender and Chibuye replied: "The minister has no authority to instruct ZPPA or ZNTB at that time to cancel a tender which has been duly awarded in accordance with the solicitation document."
Zulu then asked Chibuye if Siliya's instruction was irregular and he replied in the affirmative.
Chibuye said only the permanent secretary was legally allowed to liaise with ZPPA over matters of procurement.
"The minister can't get involved in the procurement process at all," Chibuye said.
He said ZPPA in response to Siliya's cancellation directive found no compelling reasons to justify the cancellation of the tender.
Chibuye said in another letter dated September 28, 2010 that the then ministry of communications and transport permanent secretary, Dominic Sichinga, told ZPPA that initial approval granted to award the contracts did not include the other components representing Thales ATM.
Chibuye said Thales ATM previously Flight Craft Aviation quoted the other contract amounts of 128,619.00 Euros, US$859,000.00 and 16,615,697.00 South African Rands.
"In the same letter, the controlling officer stated that the above amounts be included in the re-validation of the authority as they represented the local works associated to the contract," Chibuye said.
He said ZPPA declined to vary the contract as per Sichinga's request because the ministry did not provide justification for variation of the initial contract sum to increase it by other amounts.
But Chibuye apologised to the nation saying the above anomaly could have been avoided if the ZPPA officer who opened the bids did not just call out one name.
Chibuye said there was negligence on the part of the officer but he also wished the ministry and Thales Air Systems had been able to detect the inconsistencies.
"ZPPA approved a bid that was erroneously read out but they somehow missed the aspect of a joint venture," Chibuye said.
At this point Zulu said former ZPPA director general David Kapitolo must be summoned to appear before the Commission tomorrow Wednesday together with former ZPPA director in-charge of goods and services, Manus Simwanza.
And on the tender for additional requirements to operate the already re-activated sadar system at the Kenneth Kaunda International Airport, Chibuye said the ministry of communications on March 16, 2010 sought a waiver from open bidding to directly bid Selex Sistemi Integrati.
Chibuye said this Italian company, Selex, had made an offer to repair the radar for free on November 4, 2008.
Chibuye said on April 20, 2010 ZPPA granted the ministry a ‘no objection' to go ahead and single-source Selex Sistemi Integrati on the above tender.
Chibuye said in issuing the ‘no objection' to single-source, ZPPA relied on the expertise of technocrats within the ministry and did not undertake its own independent technical assessment.
He further said he was not aware that Selex was a late bidder on the tender to operationalise the already re-activated radar at the KK International Airport before it offered to repair the same radar for free.
Labels: AIRPORTS, DORA SILIYA, EUSTERN MAMBWE, ZPPA
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Siliya acted irregularly- ZPPA
TIME PUBLISHED - Monday, December 19, 2011, 8:22 pm
Former Transport and Communications Minister Dora Siliya acted irregularly when she instructed the Zambia Public Procurement Authority (ZPPA) to cancel a tender which had already been awarded to a company.
ZPPA Director General Samuel Chibuye said
the Minister had no authority to instruct the authority to cancel a tender which has already been awarded be cancelled.
Mr. Chibuye was testifying before the Investigations committee sitting to investigate the tendering procedure of supplying, delivering and installing of a Traffic Management Surveillance Radar System at the Kenneth Kaunda and Harry Mwanga Nkumbula International airports in Lusaka and Livingstone respectively.
And Chairperson of the Investigations Sebastian Zulu has summoned the former Director General for the ZPPA David KapitoloO to appear before the committee on Wednesday this week.
[ZNBC]
Labels: AIRPORTS, DORA SILIYA, SAMUEL CHIBUYE, ZPPA
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Zamtel sale was illegal
By Times Reporter
THE commission of inquiry appointed to investigate the sale of Zamtel and Finance Bank Zambia Limited yesterday heard that the sale of Zamtel was not done in accordance with the law. The commission also failed to proceed with investigations into the sale of Finance Bank Zambia because the matters that it was supposed to probe were before the courts of law.
Making submissions to the commission of inquiry in Lusaka yesterday, Transparency International Zambia (TIZ) executive director Goodwell Lungu said the then minister of Communications and Transport, Dora Siliya did not follow the procedure in the sale of the telecommunications company.
Mr Lungu alleged that Ms Siliya breached various laws, which prompted his organisation to write to former president Rupiah Banda over the manner in which the sale of Zamtel was handled. He alleged that Ms Siliya singled-sourced RP Capital Partners to evaluate Zamtel assets without following tender procedures.
“The mere fact that the former minister single-sourced PR Capital to evaluate the Zamtel assets without following tender procedures was in itself a breach because RP Capital Partners was not registered with a relevant authority in Zambia", he said.
He explained that the then minister of communications engaged RP Capital Partners to evaluate the assets of Zamtel when it was not registered with the Evaluation, Surveys Registration Board.
Mr Lungu said it was clear that the manner in which RP Capital Partners was selected was against the provision of the Public Procurement Act. He said when TIZ carried out it own investigations to ascertain whether RP Capital Partners had the expertise to carry out an evaluation on Zamtel, there was no data relating to such expertise.
Mr Lungu also said former President Banda’s son, Henry allegedly introduced RP Capital Partners to a local firm known as Pangea Securities in a bid to have the firm jointly carry out the evaluation of Zamtel but that Pangea declined the offer. When asked whether it was an offence for a foreign company to partner with a local firm, Mr Lungu said it was not except that a foreign company could not carry out an evaluation if it were not doing it jointly with a local firm. Mr Lungu also stated that another breach by the then minister was that the Memorandum of Understanding (MoU) related to the privatisation of the parastatal company was supposed to have been signed by the minister of Finance and not Ms Siliya.
He said his organisation and some civil society organisations which opposed the sale of Zamtel agreed with the then attorney general that the MoU, which was the preliminary stage leading to the final sale and transfer of assets of Zamtel, should have been signed by the minister of Finance. He said another breach by the then minister of Communication and Transport was that she went ahead to sign an MOU which was not substantially the same as the draft which the solicitor general had cleared for signing.
Mr Lungu said in the MOU that was signed by the minister, there was an insertion of a base floor amount of US$ 2million, which was not contained in the final draft the solicitor general had approved. He said Ms Siliya also signed the MOU committing the Government to a sum of money beyond her ministry threshold without the approval of the Zambia Public Procurement Authority.
TYIZ, Civil Society for Trade Network, Southern Centre for the Constructive Resolution of Disputes, Jesuit Centre for Theological Reflection, Citizens Forum, and Civil Society for Poverty Reduction were among those who objected to the sale of Zamtel.
And the commission chairperson Sebastian Zulu said the rule of justice demanded that Ms Siliya defends herself against the allegations levelled against her. He also said the commission would not proceed with the investigation into the sale of Finance Bank Zambia because the matter was before the courts of law.
Labels: CORRUPTION, DORA SILIYA, GOODWELL LUNGU, HENRY BANDA, RP CAPITAL PARTNERS, TIZ, ZAMTEL, ZPPA
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Ministry of Energy overruled tender procedures - Chibuye
By Ndinawe Simpelwe
Wed 19 Oct. 2011, 14:00 CAT
THE procurement authority has revealed that
the Ministry of Energy and Water Development overruled some tender procedures in the procurement of the country's oil. Zambia Public Procurement Authority (ZPPA) director general Samuel Chibuye said
the ministry was unable to follow the advice given to it by the ZPPA tender committee.Chibuye revealed that
it was mandatory for the ministry to get back to ZPPA every time negotiations were concluded in order to give the
final approval of the deal.
"The current Glencore contract for the procurement of oil was not concluded as per procedure. The Ministry of Energy did not come back to us for the final confirmation. We gave the ministry the estimated price for the deal and they were supposed to come back to us after the negotiations but they never did," Chibuye said when he appeared before the energy tribunal chaired by Wynter Kabimba, set up to look into the corrupt practices in the energy sector during the previous government.
Chibuye said the ZPPA gave the ministry an estimated total of US $3.56 billion for the procurement of 1.44 million metric tonnes of oil.
He said the ministry awarded the contract to Glencore at US $1.2 billion for the same amount of oil without getting final approval from ZPPA.
"They (ministry) always come back but for this one they didn't and we only learned that the amount was negotiated downwards," he said.
Asked whether the committee operated without interference from the ministry, Chibuye said the committee worked independently although there were times when it was unable to follow the procedures.
Chibuye also revealed that the ZPPA was not consulted when Dalbit was contracted to refurbish oil tanks in provincial headquarters of the country.
The tribunal further asked Chibuye why Dalbit was awarded the contract to refurbish and build oil tanks when it did not have the expertise for the job.
"We assumed that the ministry had done the investigations to know whether Dulbit was specialised in oil tank refurbishment. We did not know that this company had never done such works before. The fact that they had the finances to carry out the work when the government didn't made us award them the contract," said Chibuye.
The tribunal later told Chibuye that Dalbit had no expertise to build or refurbish oil tanks and that it had to sub-contract another company.
Labels: GLENCORE INTERNATIONAL AG, MINISTRY OF ENERGY AND WATER DEVELOPMENT, SAMUEL CHIBUYE, ZPPA
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Kristafor notes ills in public procurement
By Sandra Lombe in Livingstone
Mon 29 Nov. 2010, 04:00 CAT
SOUTHERN Province permanent secretary Gladys Kristafor says that there are challenges faced in as far as the structure and composition of procurement committees are concerned. Kristafor said on Friday that most institutions had challenges of capacity and human resources in public procurement.
At the close of the five-day workshop on procurement of goods, services and works organized by the Zambia Public Procurement Authority (ZPPA) under the auspices of public expenditure management and financial accountability programme at New Fairmount Hotel, Kristafor commended ZPPA for ensuring that each province had a crop of adequately trained procurement personnel.
She said the new Act had come with some unique features aimed at promoting effectiveness and efficiency and also to promote transparency and accountability in the public procurement system.
Labels: GLADYS KRISTASFOR, ZPPA
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Ndalamei urges efficiency in contract management
By Chiwoyu Sinyangwe
Wed 05 May 2010, 00:30 CAT
SECRETARY to the Treasury Likolo Ndalamei has observed that there is need to achieve efficiency in contract management of public works.
In a speech read for him by Ministry of Finance permanent secretary for Financial Management and Administration Berlin Msiska during the official opening of a training workshop on contracts management organised by Zambia Public Procurement Authority (ZPPA) in Siavonga on Monday Ndalamei said the Authority under the new Act had the mandate to coordinate and promote capacity building and professional development in public procurement system.
Ndalamei said there was need to equip procurement staff with relevant knowledge and skills in managing contracts for works, goods and services.
“I am confident that by the end of this training, you will acquire the necessary knowledge and skill required to perform your work effectively and efficiently. Moreover, I expect that your knowledge will move us closer to achieving the objectives for which the public procurement Act was established.”
Earlier, ZPPA director general Samuel Chibuye said there was need to create capacity of procurement officers in government ministries and other spending agencies in line with the 2008 ZPPA Act.
Chibuye said giving capacity to procurement officers would help to bring efficiency in procurement in government ministries and other spending agencies.
Labels: BERLIN MSISKA, CONSTRUCTION, LIKOLO NDALAMEI, ZPPA
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The rot in public procurement
By Editor
Sat 27 Mar. 2010, 04:00 CAT
PUBLIC procurement is one of the main areas open to abuse and corruption in the country.
This type of corruption and abuse of resources continues to cost the country huge sums of money, which could be ploughed into important sectors such as health and education. It is very clear that people in the public service are not ready to follow procedure and have resorted to shortcuts when it comes to procurement of goods and services. The tender procedures are very clear but in most cases these procedures are ignored with impunity. In other instances, guidelines are followed just for formality because the government already know the company they will award a particular contract.
The concern raised by Parliamentary Public Accounts Committee (PAC) chairperson Emmanuel Haachipuka that the Ministry of Agriculture and Cooperatives has been engaging two companies, Nyiombo and Omnia, to supply fertiliser to the government for the Farmer Input Support Programme for the last seven years requires serious reflection and deep meditation. We say this because this is another example of what form our country’s procurement process has taken. We are not in any way suggesting that these two companies are not qualified to supply fertiliser to the government for whatever purposes. We just think that seven years is a long time and it is difficult to believe that there have been no other players with the capacity to offer the same services, even at a lower cost.
The Ministry of Agriculture and Cooperatives is not an isolated case on this score because several other ministries such as energy, works and supply, education and communications and transport are just as guilty when it comes to engaging suppliers. It is more worrying that the government has actually turned to single sourcing as its preferred mode of procurement in most of these ministries. Deals are being sealed for big projects involving the supply of various goods, services, the construction of infrastructure and many other key works without following proper procedure.
It is not too long ago that the Ministry of Communications and Transport single-sourced RP Capital Partners of Cayman Islands to value Zamtel assets before partial privatisation. Recently, the energy ministry single-sourced a Chinese company to drill boreholes at a disputed cost of US $50 million. At what cost is each borehole going to be sunk?
The country has also faced fuel shortages before as a result of corruption in the procurement process. Even Rupiah Banda on November 11, 2009 was quoted as having said, “...there are a lot of vested interests in the procurement of fuel. Of course there are vested interests and they get upset that we may be interfering with what they have been doing all along.” But Rupiah did not reveal the names of the people behind the vested interests. Rupiah knows these people with vested interests that he talked about.
There is need for the people involved in public procurement in our country’s public service to relook at the manner in which they are doing things. They are using public funds, which are generated from taxes paid by a few of our people that are currently in formal employment. This money can sort out a lot of problems but it ends up in the pockets of a few unscrupulous individuals as kickbacks for facilitating these deals. This is unacceptable and it should not be allowed to continue.
We need to ensure that public service workers adhere to the guidelines set by the Zambia Public Procurement Authority (ZPPA) when contracting suppliers of goods and services. ZPPA cannot just be there to rubberstamp deals that are sealed at midnight by the powerful without their involvement. ZPPA cannot just be there to issue statements at press briefings, endorsing certain transactions even when the people in that institution know deep down in their hearts that they have nothing to do with a particular contract. We have seen this happen and it should not be tolerated.
The corruption in procurement is also disadvantaging other companies, which have the capacity to supply goods and services to the government. We have cases where projects that can be handled by small local companies are given to foreigners at a huge cost while in other cases, big contracts are given to companies or friends of the powerful whose briefcase companies’ capacity to deliver is questionable. You cannot have a country where the preoccupation of those running its institutions is to amass wealth, expect kickbacks, cuts and favours in every transaction. It is such corruption that saw this country get genetically modified organism (GMO) maize supplied to the Food Reserve Agency and yet the country does not accept GMO maize. It is such corruption that has led to unnecessary fuel shortages, causing problems in the country’s economic sector.
There is need for those entrusted with the responsibility of discharging public service to be serious and arrest this problem, which seems to be endemic in our country. We will not make any development progress as a country if we do not spend our country’s resources prudently. If the insatiable appetite to seal questionable deals at midnight in exchange for kickbacks, cuts and favours is not addressed, we will continue to lag behind as a country and poverty will continue to ravage our people. No matter how much we publicise the national anti-corruption policy and the implementation plan, corruption will reign if nothing is done to stop it in the various key areas such as procurement. We will continue to talk about unemployment, disease, floods, illiteracy, poor infrastructure, poor healthcare and education services for years to come if Rupiah and his friends do not stop the rot that is going on in procurement. There is clearly a problem and it needs to be addressed.
We need to understand that corruption in procurement impedes economic development, affects the efficiency of public spending, creates waste and affects the quality of service provided and ultimately the quality of life. We cannot continue to take the approach of the ‘the best briber takes the deal’ because this tendency has in some cases led to a situation where policy processes are determined by bribing firms.
We know that contracting is the main way in which any government operates and spends public money. We know that these contracts are the vehicles for implementing public policy but these vehicles should not be used to amass wealth at the expense of poor Zambians. The country’s efficiency in delivering services and ensuring development to the people will largely depend on how much we control corruption in procurement and it is possible to do this. Our continued talk about development and fighting corruption will continue for years if no practical steps are taken to fight the abuse of public resources in the government. We will continue reversing the gains that the country has recorded if we do not stop the rhetoric and act on this cancerous vice, this abuse of public funds. Like someone once said, in all our efforts to develop the country, we will be “trying to take off at the end of history’s runway” if corruption and abuse of resources is not curbed.
Labels: CORRUPTION, PROCUREMENT SYSTEMS, ZPPA
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ZPPA announces bids for crude oil suppliers
By Chibaula Silwamba
Sun 17 Jan. 2010, 04:00 CAT
LITASCO is among the seven companies that submitted bids to supply and deliver 1.4 million metric tonnes of crude oil to Zambia for the 2010-2011 period.
Opening the bids that were submitted at Zambia Public Procurement Authority (ZPPA) office in Lusaka on Friday, ZPPA acting director of purchasing goods and services Shadreck Shawa announced that seven companies had submitted the bids.
The bidders are Russia's Lukoil International Trading and Supply Company (LITASCO), Kuwait's Independent Petroleum Group (IPG) company, Kenya's Gulf Energy Limited, Glencore Energy UK Limited, Vitol SA, Trafigura and Addax Energy SA.
IPG was the crude oil supplier to Zambia for two years, from 2008 to 2009 and the contract expired on December 31, 2009.
Shawa read a notification of non-participation from Kobil Petroleum Limited.
After this, the bids will be taken to the Ministry of Energy and Water Development for evaluation.
Shawa said the winner of the bid is expected to be announced after about a month.
Last week, well-placed government sources revealed to The Post that the government, through energy minister Kenneth Konga, availed the original tender document to LITASCO through its official Leon Hayward for the firm to suggest some changes in its favour and disadvantage competitors.
But when contacted for comment, Konga denied any linkage to LITASCO although insiders said he had been working closely with Hayward from June last year when a Zambian businessman introduced LITASCO to President Rupiah Banda at State House.
Sources revealed that Konga and Hayward met on several occasions in Johannesburg and Lusaka to discuss the oil procurement deal.
A comparison between the original tender document and the revised one showed that the Ministry of Energy and ZPPA made changes on all the points that Hayward disapproved.
When contacted from Dubai, Hayward declined to comment on the revelations.
Responding to a press query, Konga stated that he had no role in the tender process other than giving policy guidance at the Ministry of Energy.
“I, therefore, did not give any tender document to LITASCO. The document can be accessed by any third parties (other than the Ministry of Energy and Water Development and Zambia Public Procurement Authority) when they buy it from ZPPA. Given the fact that the document can be sold to anyone who wants it, it is in that sense a public document,” stated Konga.
But a ZPPA source dismissed Konga's explanation.
“Just wait and see, unless something fundamentally changes, this contract is destined for LITASCO and there is enough evidence to show that Mr Konga has been in touch with Leon Hayward of LITASCO,” the source said.
Labels: LITASCO, OIL, PROCUREMENT SYSTEMS, ZPPA
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It’s criminal for Konga to give inside information to a bidder, says Lubinda
By George Chellah
Mon 11 Jan. 2010, 04:01 CAT
PATRIOTIC Front (PF) spokesperson Given Lubinda yesterday said
it is criminal for energy minister Kenneth Konga to give inside information to a bidder.
Reacting to the revelations that government, through Konga, availed the original tender document to LITASCO through its official Leon Hayward so that LITASCO could make or suggest some changes in its favour and disadvantage competitors, Lubinda cautioned Konga against such questionable transactions.
“He Konga has no immunity and he must be careful that he will be prosecuted the very day Rupiah Banda leaves State House, Konga will go in for prosecution. So he must stop facilitating such dubious deals and he must come out clean on this issue of LITASCO. It is unacceptable even under the Zambia Public Procurement Authority (ZPPA) Act. It is a crime to give inside information to a bidder,” Lubinda said.
“It is a criminal offence for which Konga could actually face arrest. Konga could actually be indicted now, not even after Rupiah has lost the elections. But now Konga could actually be indicted and he must be careful because we in the opposition could initiate immediately a tribunal to investigate him because that's abuse of office. So can he please drop this hot metal, let him throw it on the laps of Rupiah Banda so that he comes out clean. Otherwise he will face the consequences alone.”
He said everything the MMD under President Banda tries to do is always shrouded in very suspicious events.
“You can look at how they tried to coerce journalists and the media on their self-regulation. All of it was mugged with a lot of underhand methods, bribery, intimidation… everything they do even in the area of contracts, they do things using underhand methods,” Lubinda said.
“Isn't this an explanation for Rupiah Banda's refusal to dismiss Konga over the scandalous handling of the fuel crisis. Now it renders credence to the fact that Rupiah Banda could not take action against Konga because of this ongoing deal. This has been a deal that has already been agreed on between Rupiah Banda and LITASCO and Konga is the purveyor.”
He said President Banda's government was determined to conclude the LITASCO transaction.
“It is for the present and future benefit of Rupiah Banda. Rupiah Banda is preparing himself for and after 2011 that's the reason why he is forcing us to enter into contracts of such long-term nature under very dubious and suspicious circumstances. Under Rupiah Banda State House has been turned into a contract awarding office, that's where deals are negotiated, it's no longer at ZPPA,” Lubinda said.
“It is now at State House and all the time, there are some people who are involved. Can Konga please tell us which other Cabinet minister or MMD steward was involved in the discussions in South Africa? This is a person who has no business at all in transactions of Zambia, particularly in oil but he was the first one to enter into these negotiations.”
He said this rendered support to recent media reports, which were carried about President Banda preparing Konga to take over from Vice-President George Kunda.
“This is a big financial transaction and Rupiah Banda would even sacrifice George Kunda to keep the transaction going. For as long as Konga is retained and he is given more power, that is the reason why Konga has become so arrogant! This explains why there is such closeness between Rupiah Banda and Konga. This is typical of Rupiah Banda. He will see that he creates blue-eyed boys, blue-eyed girls around issues that affect him personally,” Lubinda said. “My advice first is to the civil servants because ultimately, it is the civil servants that shall implement this contract. Let me caution them, those who are coming out and informing the public are doing it for the good of Zambia and for the good of posterity.
But those who shall facilitate such transactions, one day posterity will judge them very harshly. So let them stand up like others, let them stand up in defence of Zambia, in the protection of the resources of Zambia.
“As for Konga and Rupiah, I want to say to Konga he has no immunity and he should not think that he is going to be covered by the blood of Rupiah Banda. Rupiah Banda's immunity shall be removed whether he likes it or not and what about Konga who has no immunity?
He shall face the consequences. He has just to take a leaf of what happened to Chiluba and his blue-eyed boys. Chiluba now he is walking the streets courtesy of Rupiah Banda and George Kunda. But Chiluba's blue-eyed boys are having to suffer the consequences, he too Konga is setting himself a very dangerous trap.”
On Saturday, the government's attempt to rig the bid for the supply and delivery of 1.4 million metric tones of crude oil in favour of Russia's LITASCO was exposed.
Labels: CORRUPTION, GIVEN LUBINDA, KENNETH KONGA, LITASCO, ZPPA
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Konga drops plans to award LITASCO crude oil supply deal
By Chiwoyu Sinyangwe
Sat 02 Jan. 2010, 04:01 CAT
ENERGY minister Kenneth Konga has dropped plans to award LITASCO a crude oil supply contract in preference to another foreign firm after his earlier scheme with the Russian company was exposed, sources within the Ministry of Energy have revealed. But Konga said he is not involved in the transaction.
And Zambia Public Procurement Authority (ZPPA) has said all companies that participated in the recently aborted tender process for crude oil supply will have to re-apply under the current bidding process which is expected to close next week on Thursday.
The government last month suspended the process of hiring a foreign company to replace Kuwait oil giant Independent Petroleum Group (IPG) whose two-year contract for the supply and delivery of 1.4 million metric tonnes of commingled petroleum feedstock comes to an end this month.
The government announced the suspension of the deal, saying the move allowed for adjustments to the tender specifications and gave recently appointed permanent secretary in the Ministry of Energy, Teddy Kasonso, time to acquaint himself with the 24-month contract.
It is, however, believed that the cancellation of the earlier tender process followed the exposure by The Post of Konga’s manoeuvres to award the contract to LITASCO.
But in an interview last Tuesday, Konga denied having a hand in the crude oil procurement deal and said only ZPPA had the full control of the processes of public procurement.
“I am sure that you are aware that LPG’s contract to supply crude comes to and end at December 2009. So the government is advertising to request for new suppliers.
Those are the speculations and information somebody was giving you but procurement procedures through the Zambia National Tender Board (now Zambia Public Procurement Authority)…they haven’t even spoken to the prospective bidders, but you somebody told you we have selected LITASCO or some other company even before tender procedures.
So, I don’t know how we can agree because there are procurement procedures that the government has to follow before it attract the bidder,” said Konga. “…I am not responsible for procuring, the tender board is…my ministry just comes up with guidelines and then we submit our request to the tender board.”
Labels: CORRUPTION, KENNETH KONGA, LITASCO, MINISTRY OF ENERGY AND WATER DEVELOPMENT, OIL, PROCUREMENT SYSTEMS, ZPPA
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Rupiah has a corrupt mind – Hichilema
By George Chellah
Fri 04 Dec. 2009, 04:00 CAT
President Banda toasts with Irish Ambassador to Zambia Tony Cotter after the envoy presented his credentials at State House yesterday - Picture by Collins Phiri
UPND leader Hakainde Hichilema yesterday said President Rupiah Banda has a corrupt mind and therefore has no moral right to talk about the fight against corruption, especially when the powers of the Zambia Public Procurement Authority (ZPPA) have been transferred to State House.
Commenting on President Banda's statement that government recognises the need to strengthen the law on assets declaration, forfeiture of proceeds of crime and that of enhancing whistle-blower protection to fight corruption, Hichilema dismissed President Banda's address to the nation on Wednesday to launch the anti-corruption week.
"Rupiah Banda for me as far as I am concerned has no moral right to talk about the fight against corruption. The conduct of his government has demonstrated that corruption is condoned from the highest office," Hichilema said. "It's his office that has transferred the powers of the ZPPA to State House as we have seen in the Zamtel and oil procurement cases."
Hichilema said President Banda had absolutely no interest in fighting corruption.
"What he does is to wear a mask and project to the public that he is fighting corruption when he is doing the opposite. Zambians must not allow Rupiah Banda to change large commodity procurement contracts for personal gain," he said.
Hichilema doubted the genuiness of President Banda's statement on enhancing whistle-blower protection to fight corruption.
"He removed former Task Force on Corruption chairman Max Nkole who wanted to appeal (former president Frederick Chiluba's acquittal). He removed Kapitolo (then director general of the Zambia National Tender Board), so which whistle blower is he trying to protect?" Hichilema said. "A corrupt mind starts by preparing the way. They just look at the current structure, management and when they look at certain officers like Max Nkole, David Kapitolo and Peter Mumba (former energy permanent secretary), he gets rid of them."
And Hichilema criticised the recent presidential appointments.
"Look at what he has done. How many Cabinet ministers are from one region? It's now jobs for boys and girls, for the relatives, clansmen! This is Zambia, not Gwanda. I hate talking about this because I have been a victim of tribal hegemony. Certain provinces like Southern Province have no Cabinet minister," Hichilema said. "There is no single Cabinet minister from there (Southern Province) and you have five ministers and about 14 deputy ministers all from one region and in one place which is part of Zambia you choose not to have a Cabinet minister."
Hichilema said President Banda did not know what people were saying on the ground.
"He is just busy flying around but people are saying 'there is a corrupt man going'," he said.
Hichilema also dismissed home affairs minister Lameck Mangani's justification of the appointments.
"Mangani mentioned me in that but he must not associate me in his dirty tribal mind. Mangani is doing that because of the President's corrupt mind. This is what a corrupt President can do, especially a visionless President. You know Rupiah Banda is not morally upright with regards to corruption and to talk about corruption" Hichilema said.
He challenged President Banda to let the oil contract the late president Mwanawasa left to continue.
"He is trying to change the contract corruptly. We were having fuel flowing smoothly until the greed of that man came in. Leave that petroleum contract just as Mwanawasa left it, if he is fighting corruption," Hichilema said. "Look at what he is doing at the Judicial Complaints Authority (JCA). I know judge Chulu personally, Prof Mvunga not much but the President appointing them is corrupt. Look at the Chief Justice, the returning officer, Electoral Commission of Zambia (ECZ) and the Judicial Complaints Authority...Rupiah Banda is embarassing people. This is why we are asking for an independent Electoral Commission. He is stuffing people in the Electoral Commission."
Speaking on Wednesday evening in his address to the nation on Zambia National Broadcasting Corporation television to launch the anti-corruption week, President Banda said government would continue to strengthen the anti-corruption institutional framework to address any weaknesses and negative effects of the scourge. He said corruption drained resources from the much-needed investment in health, education, infrastructure and other basic services.
“Corruption weakens democratic institutions, perverts the rule of law, discourages investment and aid inflows, undercuts public confidence in government, breeds inequality and disenfranchises large segments of the population,” the President said.
President Banda said pervasive corruption nurtured organised crime, including trafficking of human beings and drugs, and is associated with money laundering, including illicit international money transfers which can be used to finance terrorist groups.
He said corruption was a severe obstacle to development and Zambia could not afford to continue tolerating it.
The President said as Zambia joined the world in commemorating the International Anti-Corruption Day, his administration would remain steadfast in its resolve to rid the country of the vice.
“In this regard, my government shall continue to strengthen the Anti Corruption Commission and other institutions involved in fighting the scourge. But the fight needs the support of all well-meaning citizens,” he said.
He said Zambia has continued to place the fight against corruption on top of its agenda.
The International Anti-Corruption Day falls on December 9 and this year’s theme is: ‘Your No Counts’.
Labels: CORRUPTION, HAKAINDE HICHILEMA, RUPIAH BANDA, ZPPA
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Rupiah’s inability to manage the country worries Nawakwi
By Chibaula Silwamba
Tue 01 Dec. 2009, 04:02 CAT
PRESIDENT Rupiah Banda and his government’s inability to manage the country is worrisome, FDD leader Edith Nawakwi said yesterday.
And a government source yesterday revealed that State House is fully behind LITASCO and that one of the immediate assignments for the newly-appointed energy permanent secretary Teddy Kasonso is to ensure that LITASCO is awarded the tender to supply commingled petroleum.
Commenting on revelations that the US $1.4 billion two-year contract to supply and deliver 1,440,000 metric tonnes of commingled petroleum feedstock will not be transparent because the government, through energy minister Kenneth Konga, had already selected LITASCO as a preferred bidder and that the ongoing bidding process being done by the Zambia Public Procurement Authority (ZPPA) will just be a rubber stamp procedure, Nawakwi questioned the secrecy surrounding the purchase of crude oil.
“This inability of the government under Rupiah Banda to manage our country to the satisfaction of the Zambian people is worrisome. We, and many people, have said that the fuel shortage is artificial and I still emphasise that it is an artificial shortage. There is absolutely no way that the government could use the shutdown at Indeni as a reason for this shortage. Now as you can see, it is showing itself in the manner in which the government wants to procure feedstocks and products for this country. Ideally there should be transparency,” said Nawakwi, a one-time Minister of Energy.
“If the government wants to be respected and wants to eliminate suspicion, my suggestion is that they should do what other people have done in the past; invite the support of the World Bank to assist them with tender documentation and floating of these tenders. In many cases in a country like Zambia, if you procure your feedstock or products in a transparent manner, the World Bank can even refund you for the money which you are using because your argument will be that you are taking money from social services to finance an expensive product at the time when the world is facing a crisis.”
She said in 1996-97, the Zambian government would tender for oil procurement and thereafter take the invoices to the World Bank and the World Bank would give cash for what was spent.
“It’s called retroactive financing. You pay and you are reimbursed. But the World Bank can only do that if your tender procedures are above board, not under these arrangements where all of the sudden there is this one delivering maize, the next day you don’t know which face is dealing in oil,” said Nawakwi.
And senior government official yesterday revealed that State House’s hands were too deeply involved in the LITASCO transaction and ZPPA’s hands were tied because they are just receiving instructions.
“As you know, this company was introduced to President Rupiah Banda at State House around June and he committed himself to ensure that LITASCO is awarded the tender,” the source said.
“They all know that what they are doing is wrong and a lot of people have smelt corruption. That is why they want to justify this rotten deal that they want to by-pass the current supply IPG and go directly to LITASCO because IPG buys from LITASCO. That is a big lie. LITASCO’s own production is the type of crude called ural, which is only marketed in Europe. They do not produce any of the crude that Zambia needs. Their refineries also do not produce the type of Naptha and condensates that Zambia need. If you recall, LITASCO had to buy Naptha from Iran when they last supplied in 2007. The ship was stuck at Dar es salam for a long time and this cost Zambia millions of dollars in demurrage costs.
“LITASCO has to buy out all the products that Zambia needs from the gulf region where they do not produce anything so their claim that if they supply direct to Zambia they can be cheaper is absurd. LITASCO also bid for the supply of fuel under the last tender but lost the bid to IPG on account of pricing, among other reasons. The main reason why LITASCO is favoured this time is because of the interest that President Banda has in the matter. Let the President deny this point.”
Labels: EDITH NAWAKWI, LITASCO, RUPIAH BANDA, ZPPA
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Lubinda queries Rupiah’s involvement in oil deal
By Chibaula Silwamba
Sat 28 Nov. 2009, 04:01 CAT
PF spokesperson Given Lubinda yesterday charged that President Rupiah Banda has turned State House into the centre of procurement negotiations like crude oil tender the government wants given to Russia’s LITASCO.
Commenting on revelations that the US $1.4 billion two-year contract to supply and deliver 1,440,000 metric tonnes of commingled petroleum feedstock will not be transparent because the government, through energy minister Kenneth Konga, had already selected Lukoil International Trading and Supply Company (LITASCO) as a preferred bidder and that the ongoing bidding process being done by the Zambia Public Procurement Authority (ZPPA) will just be a rubber stamp procedure, Lubinda advised everyone involved in this procurement to come out clean.
He also challenged the ZPPA to publish the conditions of the tender to allow all competitors to compete on an even footing without exchanging things midnight to suit the government’s preferred bidder.
“The problem we have is that Mr Rupiah Banda has turned State House into the centre of all procurement. Mr Rupiah Banda has reduced himself from being State President to being chief negotiator for contracts,” Lubinda said.
“That is why you see many people trooping to State House to go and fix and mix and whisky the contracts such as the one we are talking about. What ZPPA are saying that they can vary the conditions of tender during the process of tendering is nothing but just a pack of falsehoods.”
Lubinda said in this particular case, he had no doubt that ZPPA wanted the tender process to favour LITASCO.
“I want to challenge those who are in Parliament who are involved in this; we know that there is one or two individuals working with their friend … and we know that person to be known as chief rigger. When this man is involved in anything, it is because he is thinking about how to perpetuate his stay in politics,” said Lubinda.
“Therefore, I have no doubt that they are doing this with the intention of mobilising resources in preparation for the 2011 elections. This is just an MMD fundraising oil venture but the Zambian people must stop Rupiah Banda and MMD from doing that.”
A well-placed government source revealed that President Banda, using Konga, is determined to award the bid to LITASCO because he started discussions with them around June.
Another government source said the government directed the ZPPA to design tender evaluations and specifications that could only be met by LITASCO and that the first cargo delivery was scheduled by January 1, 2010 and yet bids would close on December 18, 2009.
But ZPPA director general Samuel Chibuye said making changes to the tender document is a normal procedure.
Chibuye said ZPPA had received correspondence from other bidders, without mentioning their names, who complained that the conditions were too difficult, hence ZPPA and the Ministry of Energy and Water Development were looking at those concerns to find a level playing field.
Labels: GIVEN LUBINDA, KENNETH KONGA, LITASCO, OIL, PROCUREMENT SYSTEMS, ZPPA
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Govt wants to change crude oil suppliers
By Kabanda Chulu and Chibaula Silwamba
Thu 26 Nov. 2009, 04:01 CAT
GOVERNMENT is intending to use the Zambia Public Procurement Authority (ZPPA) in a bid-rigging exercise for the supply and delivery of 1.4 million metric tonnes of crude oil in favour of a Russian company which energy minister Kenneth Konga has allegedly negotiated with.
But ZPPA director general Samuel Chibuye on Monday said making changes to the tender document is a normal procedure.
Well-placed government sources revealed that the US $1.4 billion two-year contract to supply and deliver 1,440,000 metric tonnes of comingled petroleum feedstock would not be transparent because the government, through Konga, has already selected Lukoil International Trading and Supply Company (LITASCO) as a preferred bidder hence the ongoing bidding process being done by the ZPPA would just be a rubber stamp procedure.
The sources disclosed that the government directed the ZPPA to design tender evaluations and specifications that could only be met by LITASCO and that the first cargo delivery was scheduled by January 1, 2010 and yet bids would close on December 18, 2009.
“Last week Hon Konga was in Nigeria and Tanzania on an alleged private visit where he allegedly met officials from this company and it is like they have finalised everything so government wants to bid-rig in favour of LITASCO,” the source disclosed.
“In this process, the ZPPA will be used to rubber stamp and try to legitimise the whole process. Imagine the bids will close on 18th December 2009 and two weeks later (1st January 2010), a successful bidder will have to supply the first cargo or shipment, meaning that the ZPPA will have no time to evaluate bids that will qualify to the next stage, so it is like everything has been staged-managed.”
Konga could not be reached for comment because he is reportedly out of the country on a private visit to India and United Arab Emirates.
The two-year contract to supply and deliver comingled petroleum feedstock was awarded to the Independent Petroleum Group (IPG) of Kuwait but is coming to an end next month, hence the need to invite expressions of interest to all prospective bidders. LITASCO participated in the last bid but lost to IPG.
Another well-placed government source disclosed that the Ministry of Energy submitted before ZPPA a tender document inviting bidders but there were efforts to doctor the same document in an effort to eliminate competition.
“This is meant to source a preferred supplier of feedstock, in this case LITASCO. The changes that have been made to the original tender document prepared by the Ministry of Energy and Water Development are: (1) bidders must own or time charter in excess of 30 oil tankers at any given time; (2) the bidder must own or operate a refinery capacity in excess of 1 million barrels per day; (3) bidders must produce crude oil in excess of 1 million barrels per day and (4) bidders must trade in excess of 2 million of crude oil per month,” the source said.
“The above conditions are aimed at eliminating potential competitors who could otherwise supply the requirements for Zambia. All these efforts are aimed at eliminating all competition and are stage-managed to give this contract to LITASCO.”
But Chibuye on Monday said ZPPA had received some correspondence from other bidders, without mentioning their names, who complained that the conditions were too difficult, hence ZPPA and the Ministry of Energy and Water Development were looking at those concerns to find a level playing field.
“The changes are not final,” Chibuye said. “We have also received some correspondence from other bidders who are basically saying that we need to revise some of the conditions because they are too onerous and that is a normal procedure. Bidders are free to complain and make changes. On the basis of those letters we received from bidders, we do normally liaise with the ministry so that we can make certain changes.”
Asked about the concerns on the four changes and after the four amended conditions were read to him, Chibuye responded: “Correct! That is what I am saying. We have received letters from other bidders who are saying those conditions are too onerous, they conditions will be too difficult for some of them. So we are trying to level the playing field. That is what they requested and we have no problems with that.”
He, however, said ZPPA had to involve the Ministry of Energy and Water Development in revising the conditions.
“We can't do it on our own, we have to liaise with the users which are the ministry so that at the end of the day we agree on the level that we are going to use. If they are too onerous, obviously we have to take that into account,” Chibuye explained. “Sometimes we are accused of giving business to smalltownfields, so it's a delicate balancing act. Where do you draw the line? So those are the issues we are discussing with the ministry right now.”
Asked about the concern that the tender document was amended to include the four conditions aimed at disadvantaging other bidders to pave way for LITASCO to get the contract, Chibuye said that was not true.
“No! No! That is not the issue because usually what should happen is this that the bidders, what has happened is exactly what is the normal process. When the bidder buys the document, in fact, they are free to inspect the document before they buy but even when they buy, it's a bulky document. Some of them don't have the time or the expertise to inspect but when they came across those issues they raise them with both us and as well as the ministry. Our duty is to consider those. We don't normally waive them off and say, 'look! We can't change.' Those are not cast in stones,” Chibuye said. “So we are within the period within which those changes or those communications with the bidders can be made and that is what we are doing right now.”
Asked about State House's alleged links to LITASCO and its suspected efforts to influence the tender procedures, Chibuye said he did not know anything about that.
“I don't know. No! No! At the end of the day what we want to do is transparent and credible tender process,” said Chibuye. “At the end of the day, people will be able to see and that is why we are saying when people complain, our job is to listen and see if those complaints are genuine and if they are, then we make the changes as necessary and that is
Labels: FUEL, KENNETH KONGA, LITASCO, OIL, OMCs, PROCUREMENT SYSTEMS, ZPPA
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