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Transparency of Specialty Hospital deal with Fedders Lloyd questioned ; Ramjattan fires back

The construction site for the Specialty Hospital, Liliendaal, East Coast Demerara.

The decision by the Guyana government not to go back to public tender before awarding a contract to build a multi-million dollar Specialty Hospital has come in for sharp criticism, but Leader of the Alliance For Change (AFC), Khemraj Ramjattan has rejected suggestions of corruption.

One day after the Ministry of Finance announced that the Indian company, Fedders Lloyd, would build the health facility at Liliendaal, Opposition Leader Bharrat Jagdeo and the President of Transparency Institute of Guyana Inc. (TIGI), Carl Bernard have expressed concerns about the new deal.

Bernard said he would not accept the hand-picking of a company after such a long wait and criticisms by government while it was in.

“The idea of time constraints now, the emergency of having the project move ahead and requiring bypassing the transparent and accounting process doesn’t fit, it doesn’t make sense. I think they would have to provide a far better explanation for the Guyanese people to justify that,” he told Demerara Waves Online News.

The TIGI boss said he might be inclined to consider the constraints only if government were to provide concrete explanations that could adequately justify its decision.

For his part, Jagdeo in a very brief comment to Demerara Waves said “I am very troubled by the explanation that they have given and I intend to speak extensively about this at my press conference shortly.”

Demerara Waves Online News was told that the former Guyanese leader is expected to raise concerns about the failure by government to hire an independent firm to check the work completed so far, prepare new bills of quantities and craft a new tender document that could have been used by Fedders Lloyd to bid for the project.

Citing time constraints, the Finance Ministry said it hand-picked the Indian company, Fedders Lloyd, to continue the project. “In the interest of time, Government approached Fedders Lloyd – one of the original bidders -to explore the possibility of them completing the project. Fedders Lloyd expressed continued interest and was prepared to complete and fully equip the facility.”

There are also renewed concerns about Ramjattan’s role in the entire process, having been a harsh critic of the Indian firm, Surendra Engineering that had been awarded the contract to build the Specialty Hospital.  “In my view the explanations they are giving now masks the role that Ramjattan has played throughout the process,” said a top official of the main opposition People’s Progressive Party (PPP).

The then PPPC administration later scrapped the contract with Surendra for poor performance and Guyana was later awarded judgment by the High Court.

But a seemingly angry AFC Leader lashed back at critics, denying that he had influenced Fedders Lloyd eventually being awarded the contract. “I have absolutely nothing, absolutely nothing to do with any retainer or representation for fees or anything of the sort. It is simply, we were taking up the cause….I have absolutely no favouritism here, neither did I lobby the cause or anything of the sort. It was the Ministers of Finance and Health and that was it,” Ramjattan, who is now a Vice President and Minister of Public Security told Demerara Waves Online News.

Ramjattan said he was never retained by Fedders Lloyd but as a parliamentarian, the issue had been brought to his attention by that company on the recommendation of the Indian High Commission. He recalled that after the Indian High Commission had referred Fedders Lloyd to him in his capacity as an anti-corruption crusader.  The AFC Leader said he later learned that Surendra Engineering had been manufacturing sugar factory parts rather than constructing Specialty Hospitals like Fedders Lloyd does. “These people, with the lowest price and the most experience in dealing with Specialty Hospitals, ought to have been given the contract,” he said. Ramjattan said India’s Lower House and that country’s EXIM Bank also believed that Fedders Lloyd had a history of constructing such health institutions.

He said the fact that India has decided to allocate the remaining US$14 million, which had been initially allocated for the construction of the Specialty Hospital, to the upgrading of several small hospitals countrywide plus another US$14 million for the Specialty Hospital was a deal that the nine-month old coalition government could not have resisted.

The Vice President acknowledged that the project could have been sent back to public tender in keeping with Guyana’s own transparency rules, but at the same time he pointed out that single sourcing was the best approach if the best provider has been identified. “Here is the one person that built and they came with the cheapest price and they came with the most history of building Specialty Hospitals; none of the other bidders ever did it, then why not.”

The Finance Ministry, in announcing the deal, said “Fedders Lloyd in entering this MOU (Memorandum of Understanding) with the Government of Guyana (GOG) will review the works already started; conclude a design of the Hospital that is acceptable to the GOG (Government of Guyana); and commit to fully equip the facility on completion of its construction. Fedders Lloyd also undertakes to commence work on the facility immediately following the signing of the MOU.

Back in January, 2015 the High Court granted judgment in favour of the Guyana government in terms of the special damages of US$4,285,440 which amounts to G$899,942,440 and interest thereon; costs of US$10,714.50which amounts to G$2,250,043.

Guyana now has  to apply to a court in India to have Surendra Engineering pay the damages.