NEWS | Wednesday, 28 May 2008

Ministry confronted on stinking sewage plant saga

David Darmanin

As industry sources commented on the “questionability” of the criteria used by government to choose the most advantageous bidder for the construction of the south sewage treatment plant, government officials informed Business Today that while the financial procedure used is above board, the tender is not causing any minister to lose sleep over the looming loss of EU funds due to Malta’s tardiness in completing the project.

The time factor
The Ministry for finance insisted with Business Today that: “it is normal that the evaluation process takes some time to conclude when dealing with such types of tenders.” But prolonging the adjudication of this tender any further may result in the loss of EU funds earmarked to finance the project.
Right from the start, last year, the bid submission date had been extended by a month, lengthening the entire process. The disqualified parties were only notified at the end of March this year. Authorities issuing the call for tenders had specified that the time limit for the completion of works should not exceed the period of 18 months.
MEP Joseph Muscat recently pointed out that Malta could face massive EU sanctions if we continue to discharge untreated sewage into the sea beyond the end of 2008. The same deadline (end of 2008) was stressed as the absolute limit for the construction of the new sewage plant at a bidders’ meeting held at the Water Services Corporation last year.
Furthermore, EU Commissioner Stavros Dimas recently said that the Maltese authorities informed the EU commission that works are due to be completed within the first quarter of 2009.
Insisting the government is “not informed of any delays in the contracting procedure,” a ministry spokesperson was asked to confirm whether government is obliged to have the plant constructed by the end of the year, and if so, whether it would be realistically viable to complete the project within less than six months.
“There is no time limit for the adjudication of this tender,” he said. “The deadline for the completion of works will be given to the contractor when the contract is signed… It cannot be said that the execution period for the completion of this project is shortened by the time taken by the contracting process.”
Many will conclude that if the time factor is not properly addressed, and if government authorities drag their feet over the adjudication of the tender, the financing earmarked for the project may be lost. But the Ministry added: “There is no reason, at this stage, as to why the project cannot be financed.” Asked whether if by that, the ministry means to say that veracity behind media reports over the issue are being questioned, the spokesperson ran away from the question. “Government will keep doing his utmost to make the best use of the funds available by the EU,” he answered.

The financial procedure
“Bidders have to qualify from Package 1 and 2 before Package 3 (the financial offer) is opened. The local legislation has been vetted by the European Commission and found to be compliant with the directives,” the Ministry explained.
Although the public procurement rules of the EU state that the criteria for the award of the contract rely on a choice allowed between the lowest price and the most economically advantageous bid, it still remains unclear why the financial bid was left until the end when the EU clearly regulates on such criteria. The process adopted for this tender involves a level of juggling between EU and Maltese laws, whereby, even though the financing procedures should fall under EU scrutiny, the public contracts regulations provide for a three-way package system of tendering whenever the value of the tender exceeds €600,000.

Rumours of independent audit
When the spokesperson was asked to confirm the veracity behind rumours of an independent audit commissioned by the EU to look into the current tendering system, subsequently finding flaws related to transparency, the spokesperson neither denied not confirmed the existence of such audits. “The usual contracting procedure was adopted. All documentation related to this tender, including the bids received are subject to auditing by officials of the European Commisison,” he said.