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Watch those project contracts closely

BY OBJECTIVE and normal practice, public procurement is an enabler of national development.
This is because adherence to public procurement procedures facilitates awarding of timely and cost-effective contracts to qualified contractors, suppliers and service providers to support Government through provision of works, goods and services.
It is however unfortunate that instead of procurement procedures helping to cut costs of works, goods and services, it has become a conduit through which the national treasury is bleeding huge sums of money.
It is evident that Government has been losing a lot of money through inflated costs of contracts, goods and services.
This is perpetuated mostly by some procurement staff who are in the habit of asking for a commission from contractors and suppliers who are contracted.
Those contractors and suppliers who succumb to the corrupt demands of paying a commission end up inflating the cost of projects, goods and services to cover the kickback.
This is because after paying commissions they also want to recoup their investments.
On the other hand, those who refuse or are unwilling to part away with a commission for being helped to get a supply contract are shunned.
These corrupt tendencies by some procurement officials have led to those providing lower prices being shunned in preference for those inflating costs.
Former Minister of Finance Felix Mutati is on record to have wondered why a particular item could cost twice its actual price.
Unfortunately this is what Government has been subjected to for many years through the procurement processes.
In the construction sector, apart from inflating the cost of projects, we’ve had contractors delivering shoddy works or abandoning works altogether, after being paid in full.
Now it seems another tendency has emerged where some engineers are adding components which were not part of the initial budget of government projects to increase the cost.
President Lungu is concerned that some engineers working on some projects are demanding for huge sums of money beyond what was contracted.
The Head of State is not particularly pleased, and rightly so, that the Ministry of Water Development, Sanitation and Environmental Protection is asking for an extra US$80 million to complete the Kafue Bulk Water Supply project phase one, which is at 96 percent and was contracted at a cost of US$150 million.
“That project is becoming an extra cost. How do you have an expensive water supply project like this without taking into account that you need a pump house and station. These engineers we have are fake,” President Lungu said yesterday.
The President is justified in questioning such a colossal demand.
There are two issues here. It is either the engineers are incompetent or it is a scam to siphon public funds.
If the project went through the necessary stages of planning, there is no way engineers would have underestimated it to such a magnitude.
It would be understandable if the shortfall being demanded was within 10 percent above the bill of quantities.
What the ministry is asking for is over 50 percent of the project value.
For a government which is running on a tight budget due to many competing needs, this is not attainable. If this money is paid, other needs will suffer.
As rightly noted by the Head of State, it is either the engineers and other technocrats working on these projects are highly incompetent or it is a scheme to divert money or cover up for what has already been misappropriated.
There is no way competent engineers would undervalue a project to that magnitude and hold their heads high as professionals. Actually those responsible should be benevolent enough to own up and step aside.
A thorough probe should also be initiated to get to the bottom of the matter. Those found wanting should be brought to book.
For a country that is still struggling to find its development feet, Zambia cannot afford to be careless with resources.
Worse still, the country should not allow a few individuals to hold the country to ransom by distorting the national expenditure and subsequently derailing development.