The construction company that, last year, appealed the award of a contract, resulting in the Caribbean Development Bank (CDB) withdrawing financing for a project, is once again accusing the government of St. Vincent and the Grenadines of unfairness in its handling of bids.
The company, Bally and Bally Investments Ltd., raised the issue at a press conference in Kingstown on Monday, saying that its tender for the “Coastal Defence Works: San Souci” was rejected, allegedly for missing a signature, while the winning tenderer was allowed to make substantive amendments to its bids before being awarded the contract.
Bally and Bally is arguing that their alleged omission goes to form, while the reported omission by the winning tenderer — the joint venture of Kelectric Company Limited and Belvedere Place Development — affects the substance of their bid and should have also disqualified them.
They say that in the alternative, both companies should have been allowed to make the requisite adjustments to their documents.
Cameron Balcombe, managing director of Bally and Bally, therefore, wrote, on Jan. 24, 2020 to Ricardo Frederick, director of Economic Planning, objecting to the award of the contract.
At the press conference on Monday, Balcombe and his wife, Ronnia Durham-Balcombe, a director of the company, presented their case to the media, even as they noted that a press conference is not one of the redress mechanisms contemplated by the tender document or the Public Procurement Act 2018.
“… neither is it prohibited,” Durham-Balcombe said, adding, “but it is a serious concern that should not be hidden from the public by hushed procedures.”
The document, which was allegedly unsigned and resulted in the rejection of the bid, is the bid security — a statement from the bidder’s bank, or insurance company or other approved institution providing a monetary guarantee to the client that it will not withdraw its bid before the end of the stipulated bid validity period or to safeguard against their refusal to sign the contract if selected.
The client — in this case, the Government of SVG — will have the right to keep the bid security amount if the bidder withdraws their bid or refuses to sign the contract, if awarded.
The template for the bid security is provided in the tender documents and the bidder’s guarantor completes it on their letterhead for the required amount and bid validity period and signs. There is also an area for the bidder to co-sign on the said bid security document, and it is submitted as part of the bid.
“It is this purported omission to co-sign which caused the evaluators to reject our bid. It is a given that neither party can be bound by the terms of an unsigned document. However, the absence of one of two signatures on an otherwise compliant document is a matter of form not substance.
“Substance speaks to content — correct amount, correct validity period, correct wording — while form speaks to signature, sealing. Although all other documents in our bid were signed, the evaluators thought the purported defect to be substantial enough to eliminate Bally and Bally-Earlcoat joint venture”.
World Bank looking into complaint
Balcombe told the media that his company has complained to the World Bank — which is funding the project — and has been assigned a case number, indicating that their complaint is being looked into.
He told the media that he believes that his company is being punished for complaining to the CDB last year about the award of the Yarabaqua project, which resulting in the bank withdrawing funding and ordering the Unity Labour Party government to repay the monies used.
“However, we refuse to play dead, be bullied or be silenced by the powers that may be or their agents; not then, not now, not ever,” he said.
The businessman explained that on Nov. 11, 2019, Bally and Bally Investment Ltd. –Earlcoat Construction and Plant Hire Ltd., a joint venture, submitted a tender for the Coastal Defense Works — San Souci project.
Bids were submitted by five other companies for the same project and were opened on the same date.
The bids range from EC$8.183 million (by Bally and Bally) to EC$13.263 million, with the winning bid being EC$8.452 million.
Balcombe said his company received an email on Jan. 23, 2020, indicating that its bid was unsuccessful, as the company had submitted an unsigned bid security.
He said that the company was informed by letter that this alleged unsigned document “was deemed to be a material omission pursuant to clause 29.2 (a) (ii) of the Instructions to Bidders. Specifically it was determined to be an omission that if accepted would limit in a substantial way inconsistent with the bidding document, the employer’s rights or the Bidder’s obligations under the proposed contract … Failure of the Principal to sign the Bid Bond eliminates its enforceability by the Employer, thus the Bid was rejected’.”
“Our bid was eliminated for want of a signature, nothing more.”
He, however, maintained that his company did not submit an unsigned bid security but offered no explanation about how one might have come to be allegedly included in the bid.
Balcombe said that his company did “not wish to speculate on why such was included in our tender”.
He, however, said he recalled that the insurance company signed and sealed the document and he also signed on behalf of his joint venture.
“We have to pay for these bonds and include them with the tender,” Balcombe said.
He said that during an “an ad hoc debriefing — a meeting just sprung on me as I was in the Financial Complex building — I was shown a bid bond for the said project signed and sealed by the insurance but not signed by me.
“The bid bond was otherwise complete, but for my signature and that was the end of my competitive tender of $8,183,054.35, VAT inclusive,” Balcombe said.
‘How could that be fair?’
“But, people, God does not sleep. It came to my attention that in December 2019, the bidder who was selected for the project for $8,515,232.88, VAT inclusive, had multiple omissions relating to its financial situation and performance, and its experiences, sufficient to have fallen short of the requirements of the bid responsiveness, thus making it non-compliant according to the Instructions to Bidders and should not have been given consideration.
“Nevertheless, that bidder was given the opportunity to basically re-do its bid to provide the required information and thus become compliant. Now, for want of a signature, my bid was eliminated and no opportunity given to me to include it on that single document, yet the tenderer asking for more money to do the project had more problems and was given the advantage to get their documents in order. How could that be fair?” Balcombe said.
‘deferred for clarification’
He distributed to the media a Dec. 6, 2019 document purportedly signed by the secretary of the Central Tenders Board and sent to Director of Planning noting the request that the award of the contact to Kelectric Company Limited and Belvedere Place Development.
The letter said that the matter was deferred for clarification with respect to the compliance required in the areas of financial situation and performance, general construction experience, and specific construction and contract management.
The document said that all members of the joint venture must meet the financial situation and performance requirement, noting that information was only provided for Belvedere.
“What is the combined financial position?” the letter asked.
The Secretary of the Central Supplies Tenders Board also asked the Director of Planning to specify which company of the joint venture experienced negative cash flow in 2018 and to indicate the dollar value of the cash resources of the joint venture companies.
Another request was for an indication of the years of the latest financial statements for both companies.
The document also pointed out that all members of the joint venture must have at least five years’ construction experience, adding that information was only provided for Belvedere.
The communiqué further pointed out that members of the joint venture must have at least one contract of a minimum value of EC$4.5 million. However, only Belvedere was mentioned, the letter pointed out, and asked for the relevant information for Kelectric Co. Ltd.
It further noted that all members must have a minimum construction experience in excavation and backfilling of 7,000m3 of material and 1,500m3 of reinforced concrete work.
Belvedere met this requirement, the letter said, and asked that the relevant information for Kelectric be provided.
‘Clarification’ v permitting additional information
Meanwhile, Durham-Balcombe told the media that it is mandatory for the bidder to provide the required information concerning its financials, experience and other requested information to comply with the evaluation and qualification criteria.
The bidder must also provide the bid security in the amount and for the period of validity in the form provided, she further noted.
She said that the other bidder “clearly omitted to provide mandatory/material information required in the bidding document and this material non-conformity made their bid unresponsive.
“The evaluators should know that asking and allowing the other bidder to provide the material information after the fact is not an issue of clarification, for, according to instruction 27, no change in the substance of the bid shall be sought, offered or permitted, unless it is an arithmetical correction discovered during the evaluation.”
To illustrate, she said that clarification is, for instance, where bidder has two different years for the same experience and, is therefore, asked to clarify which year is the correct year.
“Clarification is not, as in this case, permitting the bidder to include the information they previously omitted to enable compliance,” she said.
“The same instruction 29 which they sought to disqualify us under also applies to the awarded bidder. The instruction 29.4 provides ‘if a bid is not substantially responsive to the requirements of the bidding document, it shall be rejected by the Employer and may not subsequently be made responsive by correction of the material (in this case) omission’,” Durham Balcombe said.
“Their bid should also have been rejected,” she maintained.
“The issue of fairness and equitable treatment has been raised in our grievance and it is not hard to see why. So glaring were the omissions of the bidder deemed successful, yet they were permitted to include the additional information. Why wasn’t Bally and Bally also given a second chance? Why wasn’t Bally & Bally permitted to affix a signature to a single document? Was it punishment for speaking up and out?”
She said the issue is a matter of public interest as the procurement process affects how the government spends public money.
‘a disease that pervades our society’
Meanwhile, Balcombe said his company invests time, money and expend other resources to train its staff to become proficient.
“These works create opportunities for our company and employment for persons, whether temporary or permanent, who wish to put their minds, bodies and skills to work, rather than to be temporarily appeased by poor relief or linger in the hardship of unemployment.”
Balcombe said that while people who do not encounter the procurement process in their daily living may wish to ignore his company’s grievances, they should pay attention “because there is a disease that pervades our society.
“A disease that exploits the system, is weakening our morale, is causing financial undulation to the deserving, is very selective in nature and is making our brilliant minds appear incompetent on an international scale.
“Why was this disease released upon our society? My opinion is that we created it by allowing certain behaviours or conduct to go unnoticed, uncorrected or basically swept under the rug.
However, this disease has a cure and any right-thinking person with a moral compass in our society has the ability to fight this disease if they wish, or to continue to spread and nourish it,” Balcombe said.
He said that prior to the Yarabaqua experience, in 2018, his company expressed its grievance on the conduct of the procurement procedure for the sea defence works at Sandy Bay.
“We were ignored by the local authorities and we wrote to the CDB. To date, the Sandy Bay shoreline remains unprotected and the people of St. Vincent and the Grenadines refuse to ask where is the money that was earmarked for that project. Do you even care? This “don’t ask, don’t tell” syndrome is a common symptom of the disease. Are we the people the government or its servant? You decide?” Balcombe said.
After the CDB withdrew financing for the Yarabaqua project, the government decided to fund the project with public monies and to retain the contractor about whom Bally and Bally had complained, resulting in the CDB distancing itself from the project.