ISLAMABAD: The Public Accounts Committee (PAC) on Thursday directed the ministry of communications to recover Rs59 million paid to a construction firm that could not complete a bridge between Larkana and Khairpur within the specified time.

Under the agreement, the contractor was entitled to get a bonus amount for early completion of the work. As per the deadline, the bridge had to be completed by June 14, 2009. The audit report pointed out that the “National Highway Authority (NHA) executive board in its 175th meeting dated July 17, 2009, revised the project cost from Rs1,251 million to Rs1,445 million without the extension of time.”

At a subsequent meeting, the NHA executive board on November 26, 2009, allowed the extension of time up to April 30, 2010, and in October 2010 the NHA paid Rs59 million as a bonus to the contractor for early completion of work. However, the audit termed it an ’unjustified’ payment.

The audit authorities recommended that the PAC direct the secretary ministry of communications to recover the amount from the contractor and take action against the officials responsible for the payment.

PAC chairman Syed Khursheed Ahmed Shah during the scrutiny of an audit para related to the provision of bogus performance guarantee directed the communications secretary not to accept such guarantees from the insurance companies and accept the surety of banks only. The audit report pointed out that the construction firm, Sultan Mehmood and Co, was awarded the contract for the approach road for connecting the Larkana-Khairpur bridge. The cost of the project was Rs1,632 million whereas the contractor provided bogus guarantee of an insurance company.

Shahid Ashraf Tarrar, the secretary communications, informed the committee that the company had been blacklisted and was debarred from participating in future tenders.

He said the company had obtained a stay order from the Sindh High Court (SHC) and was allowed to resume work.

He, however, said a sufficient amount of the company was outstanding with the NHA and the amount in question could be deducted from it.

The PAC directed the communications ministry to refer the matter related to Rs19 million consultancy contract to M/S AA Associates to the finance ministry.

As per the audit report, the general manager NHA awarded the consultancy services contract of the project without calling tenders.

As per the reply of the communications ministry, the firm was previously engaged in a feasibility study of the project.

PAC member Syed Naveed Qamar, on the other hand, pointed out that as per the procurement rules, the condition related to calling of the tenders could only be relaxed in case of a flood or any other natural calamity.

The committee directed the communications ministry to conduct an inquiry and fix responsibility for violating the rules.

Published in Dawn, July 31st, 2015

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