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HRDC urges govt to reject contractor’s demand for backdoor 40% increase in bid price

Human Rights Defenders Coalition (HRDC) has asked the government to reject the proposed 40 percent increase in the Marka-Bangula Railway line contracted budget.

The coalition has also called upon the Ministry of Transport and Public Works to conduct a thorough and impartial review of the budget increase for the Marka-Bangula Railway line, including an independent assessment of the contractor’s justifications, stressing that the ministry should not accept abusive price adjustment of the contract.

Trapence (2nd from left) emphasizing a point during a press briefing on Sunday--Photo by Watipaso Mzungu
Trapence (2nd from left) emphasizing a point during a press briefing on Sunday–Photo by Watipaso Mzungu

This follows revelations that a Chinese company contracted to design, upgrade and rehabilitate the railway line is demanding a 40 percent increase on the price the firm initially charged to win a contract in July 2023.

Should the Minister of Transport and Public Works, Jacob Hara, approve the bid price adjustment, it is the poor heavily taxed Malawian that stands to be skinned and roasted.

Our independent investigations have established that the contracted firm has changed tune and is now demanding MK96,044,941,302.16 up from MK68,279,419,378.91 plus 15 percent additional cost, with technocrats in the ministry already pushing Hara to approve the increase even without the knowledge and approval from the Public Procurement and Disposal of Assets Authority (PPDA).

But HRDC, through a statement released on Thursday in reaction to our story published on Wednesday, urged authorities at the Capital Hill to enhance oversight mechanisms for large infrastructure projects, including more stringent evaluation of contractor bids and better monitoring of project progress.

“The government should prioritize transparency and engage with the public by providing regular updates on the status and costs of major infrastructure projects. This ensures that taxpayers are informed about how their money is being spent. If any wrongdoing is discovered, appropriate legal actions should be taken against contractors who engage in the practice of submitting unrealistically low bids with the intent of inflating project budgets later,” reads a statement signed by the coalition’s national chairperson, Gift Trapence and he entire leadership.

Trapence further urged the government to take proactive steps to protect the interests of Malawian taxpayers, including conducting due diligence on contractors and ensuring that the costs presented at the outset of a project are realistic.

HRDC has also called upon the government, the Ministry of Transport and Public Works, and all relevant stakeholders not to accept the 40 percent contracted budget increase for the Marka-Bangula railway line. It is our collective responsibility to ensure that public funds are utilized effectively, transparently, and for the benefit of all citizens.

“We will continue to monitor this situation closely and will not hesitate to take further action to safeguard of the tax payers,” vowed Trapence.

But in a separate interview on Thursday, the Minister of Transport and Public Works, Jacob Hara, said the demand is not coming from the contractor, stating that MR 94 is changing the scope of works and the contractor is giving MR94 the cost for what the client is looking for.

“On the other hand, being a design and build contract, the contractor in consultation with Engineers is proposing a more climate resilient design after cyclone Freddy experience. I have asked for the details of the new scope. Depending on the outcome, we may not do everything that is being requested now. It will be prudent to keep the cost as initially agreed, save for devaluation effects,” said Hara.

“Additional scope can be considered on a separate contract. That’s how we handle road contracts. When contractors insist on price changes that are outside our limits to effect, we usually terminate the contract and repackage it for re-tendering. We do this in order to curb any sort of conniving with contractors to stop defrauding government.”

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