A group of companies that lost the M380-million Mpilo Boulevard upgrade tender to a Chinese-led joint venture has filed an urgent court bid for the tender award to be overturned.
And their lawyer has told the court that there was evidence of official interference in the tender process that “bordered on corruption”.
The tender has been shrouded in controversy since July last year, when former local government minister Litšoane Litšoane disbanded the Maseru City Council tender panel that awarded the contract – only to be overruled by the Lesotho High Court.
The principal secretary in the local government ministry, Khothatso Tšooana, reacted by disbanding the panel a second time.
The spectacle of ministers and senior government officials meddling in the award of a lucrative tender to upgrade one of Maseru’s major highways became a hot issue before the parliamentary public accounts committee.
The Directorate on Corruption and Economic Offences was also brought into investigate allegations of corruption. It ended up by allowing the council to go ahead with the tender, saying there was no wrongdoing.
The matter has been admitted as an urgent matter and is set to be heard by the Commercial Division of the High Court next Monday.
After the council’s original tender panel was disbanded, the contract was awarded to Chinese national Zengkai Wang, who leads the SCIG-SMCG-TIM Joint Venture,
The current application to the commercial division of the High Court is by Reynier Scholten, a South African engaged as contracts manager of These Construction Services and leader of a joint venture comprising Lesotho and South African based construction companies, Stefanutti Stocks and Thadleson.
In papers filed before the Court, Scholten asked for the decision to award the boulevard upgrade tender to the Wang-led JV to be “reviewed, corrected and set aside”.
The court handed down an interim order, pending the final adjudication of Scholten’s application, interdicting Wang’s joint venture from carrying on with construction work on the upgrade.
Principal Secretary Tšooana has also been interdicted from making any payments to Wang’s joint venture in respect of the tender.
Minister Litšoane dissolved the tender panel on July 26 last year, but Justice Molefi Makara set aside his decision.
Advocate Thato Kao, acting for Scholten’s joint venture, told the court in an affidavit that shortly afterwards, the tender panel was dissolved a second time by local government Principal Secretary Tšooana.
To replace it, Tsooana appointed a tender panel of his own choosing.
Kao argues in the papers that Tšooana’s acts were wrong, as the Maseru council is an autonomous local authority that should not be subject to interference by the central government.
“From the moment the appointment of the tender panel that dealt with the tender in question is found to be improperly appointed by the principal secretary, the whole tender process becomes flawed,” Kao says.
Kao argues that the Tšooana wrongly used powers confined to “business within central government” and that he acted ultra vires because he has no power under the public procurement regulations of 2007 to appoint a local government tender body.
He alleges that the panel that decided on the award “was appointed to carry out a mandate to illicitly award the tender”.
“I submit that it was stated specifically before the public accounts committee (PAC) of Parliament that Tšooana and Maseru’s Town Clerk, Moeko Maboee., had interfered in the tender.”
Kao records that Maboee told the committee certain Ministers had also interfered in the award of the tender, and that Tšooana said they were called to State House and ordered to hand the contract to “a certain company”.
Arguing that the transparency and fairness of the tender have been compromised, he calls on the court to annul the entire tender process.
Kao told the court that after a complaint by Scholten’s joint venture to the council during the 15-day cooling-off period, the venture was called to a debriefing.
At this, they were told that they had failed to win the tender because:
- It was not clear that the company providing the bitumen works, was qualified.
- Details on the aesthetics were missing.
- The concrete foremen’s qualifications were not indicated.
- The JV’s job experience in Africa was unclear.
- The JV had no experience in bridge construction.
- The bid was too close to the budget and took no account of the possible effect of variation orders.
Kao told the court that Scholten rejected these reasons.
He said Scholten had complained to the Maseru City Council that the consultant engaged to evaluate the bids was not present during the debriefing, despite an earlier letter promising that he would be.
He said the two-envelope procedure had been flouted.
He added: “The award to [Wang’s joint venture] is not in compliance with article 50(13)(d) of public procurement regulations of 2007 in that the decision cannot stand scrutiny by the audit authorities, the business community and the public in general …”
Kao said tender evaluation documents were not made available, contrary to [procurement] regulation 50(19).
Kao also said Scholten worked hard to exhaust all local remedies by approaching the Public Procurement Advisory Division (PPAD), a section of the finance ministry responsible for overseeing the award of public-funded tenders.
However, he told the court that the division had shown no enthusiasm to deal with the Scholten’s objections.
“I submit that continuing illegality gives rise for urgency. It is clear that the PPAD is lethargic to do its job,” he said.
Kao argued that the case had attracted “wide public interest, as large sums of public money are involved.
“The tender has been interfered with and dealt with contrary to laws of Lesotho, in particular public procurement regulations …
He referred to “abuse of powers of office involved in this matter by the officials of government of Lesotho, which makes their conduct to border on corruption.”