Rwanda loses billions through irregular tenders
The East African - East Africa 09:19
Rwandan taxpayers could be losing billions of francs in sham tendering
deals while the government could also be losing millions in avoidable
court cases.
In similar fashion, multimillion deals handed to incompetent
contractors are leading to loss of public funds and holding back key
government projects.
These were part of the highlights of the discussions at the 11th
National Leadership Retreat, where central government leaders agreed
that flouting tendering and procurement procedures could be cause for
concern.
READ: Rwandan court awards alarm minister
During the meeting, Prime Minister Pierre Damien Habumuremyi cited key
projects in which the government made losses or their delivery was
delayed.
For example, Bushenge Hospital in Nyamasheke district, which was
supposed to be upgraded to a referral hospital by the end of 2012, is
yet to be completed.
According to the premier, there were issues in the tendering process
with the contractor failing to deliver on his promises, prompting the
government to reassess the deal.
This revelation came on the heels of yet another high profile
procurement scam involving the Ministry of Agriculture, Rwanda
Development Bank (BRD) and farmers who borrowed Rwf1.3 billion from
the bank to purchase 500 exotic cows but the supply tender was given
to a sham supplier.
The farmers, with each committing themselves to a euro 2,885 loan from
BRD, trusted the Ministry of Agriculture and BRD to help them secure
high yield Friesian cows from Europe instead they received poor
quality breed after the procurement procedures were flouted.
The revelation came out last month when the farmers threatened to
petition the president to intervene exposed loopholes in government
tendering processes.
Local Government Minister James Musoni said it all had to do with
breach of trust between the government and the concerned institutions.
"As the government understands, some of the farmers who saw the first
consignment of 100 or so cows, gave it a nod of approval and trusted
the ministry and other stakeholders to deliver the remaining heads of
cattle in similar shape and quality but that was not the case," said
Musoni.
He said that the government is looking into the deal to ascertain what
could have gone wrong and what action will be taken.
Rwanda Public Procurement Authority (RPPA) is supposed to scrutinise
all government tendering and procurement deals but it would appear
some ministries and government bodies retain the right to issue out
tenders.
RPPA Director General Augustus Seminega told Rwanda Today that most of
the procurement deals that have gone sour did not go through the
government body.
Some government institutions such as BRD, EWSA and RDB maintain the
independence to issue out tenders and other deals.
"In the case of BRD and MINAGRI for example, RPPA had nothing to do
with that deal. To some extent, these institutions are government
owned but they have the independence in their operations," Mr Seminega
says.
Last month, EWSA was at the centre of a tender gone bad as it sought
to pick an international company to construct a multi-million power
transmission line from Uganda and Kenya.
Two companies -- Bouygues E&S from France and ISOLUX from Spain -- locked horns.
According to local media reports, the project, which was supposed to
be ready by December 2014, will delay by another six months, following
disagreements in EWSA top management. The project is expected to cost
over $22 million.
According to the 2011/12 Auditor General's Report, majority of the
cases are related to violation of the tender-awarding laws.
Prosecution announced in December that 97 public institutions are
under investigation for misusing public funds amounting to Rwf850
million, most of which was lost in procurement deals gone wrong. Only
Rwf22 million of the 'wasteful expenditure' was directly embezzled.
READ: Team to recover public funds lost in shaky Rwanda graft cases
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