e
M/S COMMUNICATIONS AND ACCESSORIES INT –GERMANY
PUBLIC PROCUREMENT AND DISPOSAL OF PUBLIC
ASSETS AUTHORITY
REPORT ON THE APPLICATION FOR ADMINISTRATIVE REVIEW IN
RESPECT TO THE TENDER FOR CONSTRUCTION OF 33KV LINES AND
ASSOCIATED LOW VOLTAGE NETWORKS PROCUREMENT REF:
REA/WRKS/09-10/00008
ENTITY:
RURAL ELECTRIFICATION AGENCY
Report on Application for Administrative Review to PPDA under Section 90 of PPDA Act 1 of 2003 and Regulation 347in the Tender For Construction of 33kv
Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 1 of 30
TABLE OF CONTENTS
ACRONYMS
4
1.0
BACKGROUND
5
2.0
LAW APPLICABLE
11
3.0
METHODOLOGY
12
4.0
GROUNDS RAISED BY THE COMPLAINANT AND
FINDINGS OF PPDA ON GROUNDS
14
5.0
OBSERVATIONS
25
6.0
DECISION OF THE AUTHORITY
27
7.0
CORRECTIVE MEASURES
29
Report on Application for Administrative Review to PPDA under Section 90 of PPDA Act 1 of 2003 and Regulation 347in the Tender For Construction of 33kv
Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 2 of 30
ANNEXES:
Annex 1:
Best Evaluated Bidder Notice dated 12th January 2010.
Annex 2
Application for Administrative Review to the Accounting Officer dated 21st
January 2010.
Annex 3:
Annex 4
Decision of Accounting Officer on the application dated 15th February 2010.
“A” and “B”: Applications for Administrative Review to PPDA dated 17th February
2010 and 1st March 2010 respectively.
Annex 5:
Accounting Officer’s letter forwarding the procurement file dated 23rd February
2010.
Annex 6:
Annex 7:
Representations to PPDA from other bidders dated 1st March 2010.
Uganda Revenue Authority’s letter of no-objection issued to M/s Ferdsult
Engineering Services Ltd (BEB) dated 24th August 2009.
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 3 of 30
ACRONYMS
AAAC
-
All Aluminium Alloy Conductors
AO
-
Accounting Officer
BDS
-
Bid Data Sheet
BEB
-
Best Evaluated Bidder
BS
-
British Standards
CC
-
Contracts Committee
EC
-
Evaluation Committee
ITB
-
Instructions to Bidders
MAC
-
Management Advisory Committee, PPDA
NC
-
Non Compliant
PDU
-
Procurement and Disposal Unit
PP
-
Public Procurement
PPDA
-
Public Procurement and Disposal of Public Assets Authority
REA
SBD
-
Rural Electrification Agency
Standard Bidding Document
TCS
-
Technical Compliance Selection method
UNBS
-
Uganda National Bureau of Standards
URA
-
Uganda Revenue Authority
Report on Application for Administrative Review to PPDA under Section 90 of PPDA Act 1 of 2003 and Regulation 347in the Tender For Construction of 33kv
Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 4 of 30
1.0 BACKGROUND
1.1
The Rural Electrification Agency initiated the procurement for the acquisition of
contractors for the Construction of 33kV Lines and Associated Low Voltage Networks
with funding from the Government of Uganda and invited eligible bidders using the Open
Domestic Bidding method for the construction of 33kV Lines and Associated Low
Voltage Networks from Mpanga-Kamwege-Kahunge-Nkingo.
1.2
The advert for this procurement was run in the New Vision on 31st July 2009 and in the
Daily Monitor and The Observer newspapers of 06th August 2009. The estimated value of
the procurement was UGX 8,669,789,440/=. A complete set of bidding documents in
English was to be purchased by interested bidders starting on Thursday 6th August 2009
and the closing date for bid submission as per the advert was Friday 4th September 2009
at 11.00 am. Bid opening was set at 11:15am of the same day.
1.3
On the 7th August 2009, the Contracts Committee appointed the following to the
Evaluation Committee;
1.4
Name
Designation
1. Mr. Phillip F.P. Ggayi
SPE/Project Planning (Chairman)
2. Mr. Herbert Kakiza
Project Consultant/ M/s Multi-Konsult Ltd
3. Eng Bernard Kisembo
Project Consultant/ M/s Multi-Konsult Ltd
4. Ms. Deborah Natume
SCE/Project Monitoring & Evaluation
5. MS. Annette Katuramu
Procurement Officer, REA(Secretary)
On Tuesday 18th August 2009 and Monday 24th August 2009 a pre-bid meeting and prebid site inspection were held at Rural Electrification Agency Boardroom and Kamwenge
District respectively.
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 5 of 30
1.5
On Friday 18th September 2009 at 11:00am submission of bids closed and bids were
opened at 11:15 am in the REA Boardroom witnessed by representatives of M/s MultiKonsult Ltd, the Consulting Engineers & Technical Planners, PDE staff and the bidding
firms who signed the attendance PPDA Form 35 (record of bid opening).
1.6
The following 16 firms purchased bidding documents;
Firms that purchased Bidding documents.
1. M/s Eng. E.N.K Sempebwa Partners
2. M/s Dott Services Ltd
3. M/s CPCC International Company (u) Ltd
4. M/s Powergen technology (u) ltd
5. M/s Chint Electric Co. Ltd
6. M/s Haso Engineer Co. Ltd
7. M/s Yot- Kom Engineer Co Ltd
8. M/s Meridian Sales & Services Ltd
9. M/s Omega Construction Ltd
10. M/s NGM Company limited
11. M/s Ferdsult Engineering Services Ltd
12. M/s SD Agri Hitech (u) Ltd
13. M/s National Contctis Co. UR
14. M/s VS Energy (Pty) limited
15. M/s Patronic Services (u) Ltd
16. M/s Megger Technical Services Ltd
1.7
The following firms submitted the bids;
No. Name of bidder
Bid price read out
1.
M/s NGM Company limited
12,536,218,991.34
2.
M/s Ferdsult Engineering Services Ltd
11,142,943,080
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 6 of 30
3.
1.8
M/s Spencon Servcies Ltd
8,966,333,317
4. M/s Marma Technical Services
11,492,751,000
It was noted that whereas the Complainant, M/s Spencon Servcies Ltd and M/s Marma
Technical Services submitted bids, they were not listed on PP Form 30 (record of issue of
solicitation document fee payable).
1.9
Evaluation Methodology:
The evaluation methodology used was Technical Compliance Selection method (TCS)
and the following was the outcome at each of the 3 stages:
1.9.1
Preliminary evaluation: Out of the four (4) bids received, two (2) bids were
disqualified for the reasons below:
Bidder
Reasons for disqualification
1. M/s
NGM
Company •
limited
2. M/s
18.1 that required for an original.
Marma
Services
1.9.2
Bid security in photocopy form contrary to ITB
Technical •
No bid Security;
•
Incomplete bid submission sheet; and
•
Details of company bankers not provided.
Technical Evaluation: The remaining two (2) bids were evaluated and only one
(1) bid passed on item by item basis using the pass/fail methodology as summarised in the
table below:
Report on Application for Administrative Review to PPDA under Section 90 of PPDA Act 1 of 2003 and Regulation 347in the Tender For Construction of 33kv
Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 7 of 30
Name of bidder
M/s Ferdsult
M/s Spencon
Engineering Services
Servcies Ltd
Ltd
Evaluation Criteria
1. Detailed work method statement for the Not considered
Not considered
works
2. Passed experience as prime contractor over C
C
the last ten (10) years
3. Presentation of at least three (3) completion C
C
certificates for passed work done that is at
least 70% complete.
4. Competence of the following key technical
personnel (proof by signed CVs of key
personnel);
• Electrical Engineer
C
NC1
• Surveyor
C
NC2
• General Foreman
C
C
C3
NC
Conductors
C
NC4
Stays and galvanised steel wires
C
NC
Distribution transformers
C
C
5. Specifications of the major materials i.e.
1
Not member of professionally recognized institutions
Lacked the desired qualification and not a member of professionally recognized institutions. This was held to be a
major deviation from the technical requirements given the nature of the work involved
3
The Evaluation team agreed to get type test certificates on the transformers which were missing from the offer, get
clarity on the type of creosote used to treat the impregnated wooden poles and the key items such as conductors and
transformers further quality assurance was to be ensured during the factory acceptance tests.
4
Lacked manufacturer’s data for AAAC 200sqmm and 100sqmm.
2
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 8 of 30
Name of bidder
M/s Ferdsult
M/s Spencon
Engineering Services
Servcies Ltd
Ltd
Wooden poles
C
NC
33kV line Insulators
C
C
NC: Non Compliant
C: Compliant
Commercial evaluation was conducted on only M/s Ferdsult Engineering Services Ltd and was
found to be complaint with the terms and conditions of the proposed contract and completion
date of twelve (12) months.
1.9.3
Financial Evaluation:
M/s Ferdsult Engineering Services Ltd was ranked the lowest priced bid at UGX
11,163,197,920/= (inclusive of 18% VAT and 5% contingency).
1.9.4
Best Evaluated Bidder
M/s Ferdsult Engineering Services Ltd was the Best Evaluated Bidder as recommended by
the Evaluation Committee.
1.9. 5 The Evaluation Committee further recommended that the Entity holds negotiations
with M/s Ferdsult Engineering Services Ltd.
1.10
On 4th January 2010, a negotiation meeting was held between REA where M/s Ferdsult
Engineering Services Ltd was confirmed as the BEB at the Contract price of UGX
11,163,197,920/= (VAT inclusive) among other issues.
1.11
On 12th January 2010 (Annex 1), a notice was displayed showing M/s Ferdsult
Engineering Services Ltd the Best Evaluated Bidder. The notice was to expire on 25th
January 2010.
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 9 of 30
1.12
On 21st January 2010, M/s Spencon Servcies Ltd, wrote to the Accounting Officer, REA
expressing dissatisfaction that they had not been considered as best evaluated bidder,
despite their bid price being lower than the BEB. (Annex 2)
1.13
On 15th February 2010, the Permanent Secretary, Ministry of Energy and Mineral
Development issued his decision to the complainant dismissing the complaint with the
following reasons. (Annex 3)
i.
The bid price for M/s Ferdsult Engineering Services Ltd read out at the bid
opening was UGX 11,142,943,080/= (VAT inclusive). During the financial
evaluation arithmetic errors were corrected which led to a bid total amounting to
UGX. 11,163,197,920/= (VAT inclusive). The financial evaluation was conducted
in accordance with to PPDA Regulation 190 & 192.
ii.
In line with the evaluation methodology stated in the solicitation document, your
bid had the following shortcomings:
1.14
a.
CVs for personnel were not signed
b.
You did not submit Type Test Certificates for conductors as requested
c.
Your firm did not meet the specification for the poles
d.
You quoted a standard for AAAC conductor that is no longer in use.
However, the Permanent Secretary, Ministry of Energy and Mineral Development
informed the Complainant that due to other findings on the procurement process, it was
found appropriate for REA to invite fresh bids.
1.15
On 17th February 2010, M/s Spencon Servcies Ltd applied to the Authority for an
Administrative Review under Reg. 347 of PPDA Regulations. However, they stated that
they would submit a full and detailed explanation in support of their application letter
within the time scale set as per Section 347 (2) of PPDA Regulations (Annex 4 ‘A’)
1.16
On 1st March 2010, M/s Spencon Servcies Ltd submited a detailed explanation in support
of thier earlier application (Annex 4 ‘B’)
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 10 of 30
1.17
On 22nd February 2010, the Authority wrote to the AO, Rural Electrification Agency
informing them that the complainant had submitted an Application for Administrative
Review and thus requested the PDE to submit documents relating to the procurement
process.
1.18
On the 23rd February 2010 (Annex 5), the Accounting Officer, REA wrote to PPDA
submitting documents for the Construction of 33kv Lines and Associated Low Voltage
Networks Procurement Ref: REA/WRKS/09-10/00008. In addition the Accounting
officer informed the Authority of the following as issues surrounding this procurement;
a. The Entity had already lost a lot of time attending to an earlier Application for
Administrative Review by M/s Spencon Services Limited which Application was
dismissed;
b. Due to other findings in the procurement process, the Entity decided to cancel the
procurement and re-tender the procurement process;
c. The construction and commissioning of this line is urgent due to the following
reasons:
i.
It has a lot of implications on the Entity’s power supply agenda;
ii.
The Government has been looking forward to its commissioning so as to
evacuate power from 18MW Mpanga hydro power plant and then decommission an equivalent amount of generation from the expensive diesel
plants. This would mean lower generation cost ,implying lower tariffs; and
iii.
The Entity assured government that the above scenario would be realized by
the end of June 2010 when the Mpanga power plant is slated for
commissioning. The evacuation line must have been commissioned by the
time of commissioning the power plant.
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 11 of 30
2.0 LAW APPLICABLE
2.1
The Public Procurement and Disposal of Public Assets Act No. 1 of 2003
2.2
The Public Procurement and Disposal of Public Assets Regulations No. 70 of 2003.
2.3
The Public Procurement and Disposal of Public Assets Procurement Guidelines
2.4
The Solicitation Document for the Procurement referenced Procurement Ref:
REA/WRKS/09-10/00008 dated 06th August 2009
3.0 METHODOLOGY
3.1
A review and analysis of information submitted by the Entity including in the following
documents was done:
i.
A copy of invitation to bidders;
ii.
Solicitation Document issued by REA;
iii.
Record of bid issue
iv.
Record of bid opening;
v.
Bids submitted by the four (4) bidders;
vi.
The Evaluation report;
vii.
Minutes of the Evaluation Committee;
viii.
Minutes of the Contracts Committee
ix.
Notice of the Best Evaluated Bidder;
x.
Negotiation plan;
xi.
Negotiation report/minutes;
xii.
Administrative review by the Entity;
xiii.
Procurement Plan 2009/10; and
xiv.
General Correspondences
Report on Application for Administrative Review to PPDA under Section 90 of PPDA Act 1 of 2003 and Regulation 347in the Tender For Construction of 33kv
Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 12 of 30
3.2 In accordance with Regulation 347 (4) (c), on 26th February 2010, PPDA wrote to all the
bidders who participated in the procurement informing them of the Application for
Administrative Review by the complainant and requested them to submit their
representations.
3.3 On 1st March 2010, PPDA received representations from M/s Ferdsult Engineering
Services Ltd and M/s Marma Technical Services. (Annex 6)
3.4 On 3rd March 2010, PPDA convened an administrative review hearing for the parties to
present their respective cases. The attendance during the hearing is listed below:
No. Entity/REA
Designation/Employer
1.
Under Secretary, Ministry of Energy and
Mr. William Luwemba Apuuli
Mineral Development
2.
Mr. Godfrey Turyahikayo
Executive Director, REA
3.
Ms. Barbara Asiimwe
Ag. Chairperson, Contacts Contracts, REA.
4.
Mr. Richard Muhangi
Contracts Committee, REA
5.
Mr. Andrew Mugume
Senior Planning Engineer, REA
6.
Mr. Philip F.P.Ggaji
SPE,REA
7.
Ms. Annette T. Katuramu
Procurement Officer, REA
8.
Eng. Kisembo B.A
Project Consultant,M/s Multi-Konsult Ltd
9.
Mr. Herbert Kakiiza
Project Consultant, M/s Multi-Konsult Ltd
No. Applicant/M/s Speencon Servcies Ltd
Designation/Employer
Report on Application for Administrative Review to PPDA under Section 90 of PPDA Act 1 of 2003 and Regulation 347in the Tender For Construction of 33kv
Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 13 of 30
No. Entity/REA
Designation/Employer
1.
Mr. Pobbathi Sseenivashi
Chief Engineer Electrician
2.
Mr. GSN Nurty
General Manager (Planning & Contracts)
3.
Mr. K.S.V Kumar
Regional Director.
4.0 GROUNDS RAISED BY THE COMPLAINANT AND PPDA FINDINGS
4.1 GROUNDS RAISED BY THE COMPLAINANT
In the application for administrative review to the Authority, the applicant raised dissatisfaction
on the following six (6) grounds.
Ground One: CVs for Personnel were not signed: The requirement was ambiguous as there
was no specific mention that the CVs should be “signed by respective personnel”
Ground Two: You didn’t submit Type Test Certificates for Conductor: In our original bid
submissions, we have proposed to use conductors manufactured and supplied by M/s Patel Wire
Industries.
Ground Three: Your firm did not meet the specification for the poles: A review of the
technical specification requirement for Eucalyptus Wooden Poles as per Section -6 indicates that
it should comply to the standards of BS 1990 and as observed salient features of the technical
particulars are over stated (exaggerated) and does not follow strictly in accordance with BS
1990.
Ground Four: You quoted a standard for AAAC Conductors that is no longer in use: A
review of the technical specifications requirement for AAAC Conductors as per Section 6
indicates that all the standards specified are not relevant to the specifications of finished product
AAAC Conductors.
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 14 of 30
Ground Five: Bid price Comparison: The bid price comparison confirms that our bid is lower
that the BEB by an amount of UGX 2,196,864,653. This confirms that Entity will incur a
significantly higher cost if its decision is not reviewed.
Ground Six: Decision of inviting fresh bids: All procurements have to be carried out in
accordance of Part III -Basic Procurement and Disposal Principles such that the Entity gains
effective competition through the open bidding. Inviting fresh bids will only escalate the costs
due to inflation and the project completion can be delayed due to delayed procurement.
4.2
FINDINGS OF PPDA ON THE ABOVE GROUNDS RAISED.
4.2.1 Ground One:
“CVs for Personnel were not signed: The requirement was ambiguous as there was no
specific mention that the CVs should be “signed by respective personnel”.
PPDA Findings
Under detailed evaluation criteria commercial and technical criteria part 5.2 (d) on page 3 of 6,
the biding document requested for competence of key personnel and recently signed CVs for
the following positions;
i.
Electrical Engineer
ii.
Surveyor
iii.
General foreman.
On reviewing the complainant’s bid, the Authority established that the CV’s were not signed by
the individuals as stated in the Accounting Officers’ response but signed by the authorised person
to submit their bid.
Further review of all the submitted bids, the Authority noted that the BEB and M/s NGM
Company limited too submitted unsigned CVs contrary to part 5.2 (d) of the bidding document
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 15 of 30
and only M/s Marma Technical Services complied in this area although their bid was not
considered as they were eliminated at preliminary.
At the hearing, the PDE clarified that they expected CVs recently signed by their respective
owners.
The Complainant stated that all their submitted CVs were signed by the person who was
authorised to sign and submit the bid and they were of the view that the issue of CVs not being
signed by their respective owners was immaterial and more emphasis should be put on the
competence of the proposed technical personnel and not whether the CVs were signed.
In public procurement its good practice for CVs to be signed by their respective owners as a way
of authenticating whatever is stated therein and to confirm the availability of such staff to do the
works. In addition they can be initiated by an authorised party as part of a bid.
Regulation 183(7) of PPDA Reg, 2003 states that
“The classification of a deviation, reservation or omission as material or non- material
shall be consistently applied to all bids”
In this case, the Authority observed that there was no consistence in the rule of law as all CVs
submitted by all bidders were not signed and there was no mention in the evaluation report on
whether this criteria had been waived.
Decision of the Authority on Ground 1:
Based on the above observations, the Authority finds merit in Ground 1 of the application
because there was no consistency applied by the Entity with regard to treatment of bidders on
this requirement during evaluation since the CVs submitted by all bidders were not signed and
yet some were passed. It was also not very clear whether it was only the owners of the CVs to
sign them or they could be endorsed by the person authorized to submit the bid. Further, the
Evaluation Report was silent as to whether this criterion had been waived by the Evaluation
Committee
Ground One is therefore up held
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 16 of 30
4.2.2 Ground Two:
You didn’t submit Type Test Certificates for Conductor: In our original bid submissions, we
have proposed to use conductors manufactured and supplied by M/s Patel Wire Industries.
PPDA Findings
Part 3 Section 6 Statement of Requirement on page 39 of 74 of the bid document, requested for
“Type Test Certificates for conductors and steel wires issued by an approved reputable
independent testing laboratory in addition PDE would call for typed tests to be carried out at the
manafactuerers works and witnessed by purchaser or representative”.
The Authority has noted the following on reviewing the four submitted bids;
No.
Name of the Bidder
1.
M/s Spencon Servcies Managment system certificate by M/s Patel Wire
Ltd -Complainant
Submited information
Industries for the manufacturing and supply of all
types of aluminium conductors used in power
transfomation and distribution.
2.
M/s
Ferdsult M/s ZTT certificate and technical specifications for all
Engineering
Services alluminum- alloy conductors (AAAC).
Ltd -BEB
3.
M/s NGM Company Indicated document section No. 9- ISO& Qulaity
limited
certificates issued by KEBS5, however there were not
attached
4.
M/s Marma Technical Not submitted
Services
5
Kenya Bureau of Standards.
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 17 of 30
All the four (4) bidders were therefore non compliant on the required Type Test Certificates for
Conductor, however, the evaluation report indicates that the evaluation committee agreed to
conduct further quality assurance on the BEB’s Conductors during Factory Acceptance Tests.
At the hearing the Entity clarified that Type Test Certificates are issued by reputable independent
bodies (UNBS equivalent) and not manufatucturers and this creteria was not considered during
evalaution as it can be verified independently, however, ther was no record to that effect.
Decision of the Authority on Ground 2
The Authority does not find merit in Ground 2 of the application because the Solicitation
document was very clear that the Type Test Certificates had to be issued by an approved
reputable independent testing laboratory which the complainant did not compliant submit.
Ground two is therefore not up held
4.2.3 Ground Three:
Your firm did not meet the specification for the poles: A review of the technical specification
requirement for Eucalyptus Wooden Poles as per Section -6 indicates that it should comply to
the standards of BS 1990 and as observed salient features of the technical particulars are over
stated (exaggerated) and does not follow strictly in accordance with BS 1990.
PPDA Findings
Part 3 Section 6- (3) the statement of requirements on pages 31- 37 of 74 of the bidding
document provided for varying specifications for selection, treatment, testing and delivery of
treated wooden support poles structures for the project.
Generally as indicated on page 31 of 74, the poles in use for power lines supports are as follows;
Report on Application for Administrative Review to PPDA under Section 90 of PPDA Act 1 of 2003 and Regulation 347in the Tender For Construction of 33kv
Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 18 of 30
Height/
(m)
length Diameters (/circumference)
Preferred use
1500mm from the 150mm from the
butt
top
11
250(785)
190(597)
12
260(816)
197(618)
13
280(879)
210(659)
14
280(879)
210(659)
15
300(942)
230(722)
>15
>300(942)
230(722)
HV lines(>33kV)
9
230(722)
180(565)
LV Lines, Cross arms & Lay
MV Lines (11-33kV)
poles.
In addition it was stated that the bidder ideally may use the above or even higher poles as long as
the perceived profile design meets the minimum technical requirements.
Part 3 (ii) further stated that the standards of the equipment supplied under this section shall
conform to the BS 144, BS 913, BS 1990, Din 48350 and ANSI0.5.1-1972.
The comparison between the specifications proposed by the four (4) bidders and what was
required under the biding document is herein below;
Height/
Required
M/s
Spencon M/s
Ferdsult M/s
length
Servcies Ltd - Engineering
(m)
Complainant
Services
Ltd
NGM M/s Marma
Company
- limited
Technical
Services
BEB
Required
Submitted6
Submitted
6
The proposed wooden poles would be obtained from Uganda Electricity Distribution Company Limited (UEDCL),
Lugogo, although at the hearing the Entity clarified that they were not required to use such poles.
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 19 of 30
butt
top
butt
butt
butt
top
11
250
190 240
180
250
190
12
260
197 252
190
260
197
Indicated
“same
as
No response
required”
13
280
210 ----
-----
----
----
14
280
210 260
200
280
210
15
300
230 280
210
300
230
>15
>300 230 -----
-------
----
----
9
230
170
230
180
180 225
The Complainant stated that the required specifications set by the Entity were non-standard and
do not comply with BS1990 or any other international standards.
The Authority has established that there are different sizes of poles under the set standards of BS
144, BS 913, BS 1990, Din 48350 and ANSI0.5.1-1972 i.e. light poles, medium poles and stout
poles. The Entity’s specifications for the procurement at hand were for stout poles whereas the
Complainant’s proposed medium poles although both meet the BS 1990 standard.
PPDA Guideline 2/2005 requires procuring and disposing entities to hold pre-bid meetings to
allow potential bidders to seek clarification or access to project sites where applicable in
accordance with Regulation 149 of the Public Procurement and Disposal of Public Assets
Regulations, 2003. As noted under Part 1.4 on page 5 of 25 above, two pre- bid meetings were
held on this procurement, however, the Complainant did not raise the issue of the set
specifications being over stated (exaggerated) and that they do not follow strictly in accordance
with BS 1990.
Decision of the Authority on Ground 3:
The Authority finds no merit in Ground 3 of the application because the Solicitation document
clearly indicated the minimum technical specifications for the wooden poles; in this case, the
Complainant submitted alternative specifications below the required minimum specifications and
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 20 of 30
therefore was not compliant. Furthermore, the Complainant did not seek any clarifications on the
technical specifications during the bidding period as provided for under PPDA Regulation 148
(1).
Ground three is therefore not upheld
4.2.4
Ground Four:
You quoted a standard for AAAC Conductors that is no longer in use: A review of the
technical specifications requirement for AAAC Conductors as per Section 6 indicates that all
the standards specified are not relevant to the specifications of finished product AAAC
Conductors.
PPDA Findings
Part 3 Section 6- (4) the Statement of Requirements on pages 38 of 74 of the bidding document
specified the requirements for the design, manufacturer, testing and delivery to site of 33kV
(MV) and Low voltage (LV) bare overhead All Aluminium Alloy Conductors (AAAC) in
conformity to the latest edition of the appropriate IEC specifications and/or other recognised
international standards.
The performance of all four bidders against the detailed technical specfciations under the bidding
document and thsoe submited by the four (4) bidders as follows;
Type
Required
M/s
Spencon M/s
specifications
Servcies Ltd - Engineering
Complainant
Ferdsult M/s
NGM M/s
Company
Marma
Services Ltd - limited
Technical
BEB
Services
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 21 of 30
AAAC
BS1728,BS
BS:3242:1970
conductors 1475,BS3L52
200mm²
ISO 9001, ISO BS1728,BS
14001,
IEC 1475,BS
:1970,BS4140
60888, 60889, 3252:1970,BS
-
61232, 60104, 4140-
23:1987,BSE
ASTM
n12373-
502,230, 498, 12373-
9:1999,IEE60,
398, 415, IEC 9:1999,IEE60,
71, 227, 228,
61089, ASTM 71, 227, 228,
889
B
399,
AAAC50
B 23:1987,BSEn
231, 889
232,416,524,
711, 549
AAAC
BS1728,BS
BS:3242:1970
conductors 1475,BS3L52
100mm²
ISO 9001, ISO BS1728,BS
14001,
IEC 1475,BS
:1970,BS4140
60888, 60889, 3252:1970,BS
-
61232, 60104, 4140-
23:1987,BSE
ASTM
n12373-
502,230, 498, 12373-
9:1999,IEE60,
398, 415, IEC 9:1999,IEE60,
71, 227, 228,
61089, ASTM 71, 227, 228,
889
B
399,
AAAC50
B 23:1987,BSEn
231, 889
232,416,524,
711, 549
AAAC
BS1728,BS
conductors 1475,BS3L52
50mm²
BS:3242:1970
ISO 9001, ISO BS1728,BS
14001,
AAAC50
IEC 1475,BS
:1970,BS4140
60888, 60889, 3252:1970,BS
-
61232, 60104, 4140-
23:1987,BSE
ASTM
n12373-
502,230, 498, 12373-
9:1999,IEE60,
398, 415, IEC 9:1999,IEE60,
B 23:1987,BSEn
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 22 of 30
71, 227, 228,
61089, ASTM 71, 227, 228,
889
B
399,
231, 889
232,416,524,
711, 549
From the above information, M/s Spencon Services Ltd submitted BS:3242:1970 specifications
different from what was required in the bid document for all the three different conductors and
was therfore not compliant.
Decision of the Authority on Ground 4:
The Authority finds no merit in Ground 4 of the application because the complainant submitted
specifications for all the three different AAAC Conductors that were different from what was
required in the Solicitation document and was therfore not compliant.
Ground four is therefore is not upheld
4.2.5 Ground Five:
Bid price Comparison: The bid price comparison confirms that our bid is lower than the BEB
by an amount of UGX 2,196,864,653. This confirms that Entity will incur a significantly
higher cost if its decision is not reviewed.
PPDA Findings
Clause 8 of Part 2 Section 3 under the Evaluation Methodology and criteria clearly stated that the
best evaluated bid would be determined as the lowest evaluated price, from among those which
are eligible, complaint and substantially response and the Evaluation methodology used by the
Entity in this tender was Technical Compliance Selection (TCS) as stated in the Solicitation
documents. Under PPDA Regulation 214 (1) Technical Compliance Selection is the evaluation
methodology that recommends the lowest priced bid, which is substantially responsive to the
Commercial and technical requirements of the Entity.
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 23 of 30
According PPDA Regulation 215 (3) under the Technical Compliance Selection method, a bid
which is not eligible and non compliant shall be rejected and eliminated from further evaluation.
As noted above M/s Spencon Servcies Ltd was non compliant in some area and according to the
Evaluation report was rejected and eliminated at technical evaluation therefore was not
considered at financial evaluation.
Decision of the Authority on Ground 5:
The Authority finds no merit in Ground 5 of the application because under the applicable
Evaluation Methodology of Technical Compliance Selection, financial evaluation of a bid is
done only after the bid has passed both the preliminary and technical evaluation stages.
Therefore, it is only the price of a bid that is eligible, commercially responsive and technically
compliant that can be considered at financial evaluation as provided for under PPDA Regulation
216 (4).
Ground five is therefore not upheld
4.2.6 Ground Six
Decision of inviting fresh bids: “All procurements have to be carried out in accordance of Part
III Basic Procurement and Disposal Principles such that the Entity gains effective competition
through the open bidding. Inviting fresh bids will only escalate the costs due to inflation and
the project completion can be delayed due to delayed procurement”.
PPDA Findings
With reference to Annex 5, the Entity clarified at the hearing that the procurement at hand has a
lot of implications on the Entity’s power supply agenda, for example,
i.
The Government has been looking forward to its commissioning so as to evacuate
power from 18MW Mpanga hydro power plant and then de-commission an
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equivalent amount of generation from the expensive diesel plants. This would
mean lower generation cost , implying lower tariffs; and
ii.
The Entity assured government that the above scenario would be realized by the
end of June 2010 when the Mpanga power plant is slated for commissioning.
The evacuation line must have been commissioned by the time of commissioning
the power plant.
PPDA has noted both concerns of the Entity and the Complainant together with the urgency of
the procurement; however, the Authority makes decisions based on law, facts and merits of the
complaint being handled.
Decision of the Authority on Ground 6:
The Authority finds no merit in Ground 6 of the application because under PPDA Regulation 95
an Entity may cancel a procurement process at any time before contract award with reasons. In
this case the Accounting Officer was right to call for fresh bids given the irregularities he noted
during the Administrative Review
Ground six is therefore not upheld
5.0
OBSERVATIONS:
5.1
Bid Validity
Contrary to the Standard Bidding Document issued by PPDA, that requires bid validity to be
stated in working days, the Entity under ITB 17.1 of the Bid Data Sheet stated a bid validity
period of 120 calendar days from the bid submission date of 18th September 2009 which
expired on 16th January 2010. Out of the four bidders that submitted bids, 3 of them have
expired bids since they complied with the120 calendar days stated in the Solicitation
Document. However, the Complainant used a bid validity of 120 working days and their bid
is valid till 12th March 2010. During the Administrative Review, the Authority received a
copy of a letter from the Complainant to the Entity dated 5th March 2010 further extending
their bid validity and bid security by 60 working days in accordance with Regulation 151.
5.2
Omission of two Bidders on PP Form 30
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Under PPDA Regulation 147 (1) an Entity is prohibited from evaluating a bid that is not
recorded on PP Form 30 as having been received from a bidder who bought the solicitation
document directly from the Entity. A review of the PP Form 30 revealed that 2 bidders
who were evaluated namely; M/s Spencon Services Ltd and M/s Marma Technical Services
were not recorded on PP Form 30. However, the procurement file submitted by the Entity
had copies of receipts for both bidders with receipt numbers No 30770 and No. 30775
indicating that both bidders bought solicitation documents on 13th and 14th August
respectively.
5.3
Income tax clearance
The Solicitation Document under Part 2; Section 3 (B) under preliminary evaluation
criteria required bidders to submit “a copy of the Bidder’s Current Income Tax Clearance
certificate or equivalent; especially executed for this procurement. M/s Ferdsult
Engineering Services Ltd (the best evaluated bidder) submitted a letter of no objection
from Uganda Revenue Authority dated 24th August 2009.
The URA letter stated as follows:
“The above named tax payer has applied for a Tax Clearance Certificate for purposes
of providing services of construction of power line to your organization. We have no
objection to your granting the company the facility applied for.”
The Authority noted that the URA letter made no specific mention of the procurement
since it referred generally to “construction of a power line and the facility applied for”
without mentioning the project specifics of the procurement. However, the Evaluation
Committee considered the above letter as an equivalent of the Income Tax Clearance
Certificate and passed the bidder as compliant without any verification of the accuracy,
validity and authenticity of the letter as required under PPDA Regulation 186 (4) and (5)
for eligibility documents.
5.4
Evaluation process.
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Non equal treatment of bidders: It was noted that the M/s Ferdsult Engineering Services
Ltd (the best evaluted bidder) passed the technical commercial evaluation stage without
signed CVs by the owners and did not submit Type Test Certificates for Transformers and
yet the complainant who lacked the same requirements was failed by the Evaluation
Committee. In particular, it was recorded in the Evaluation Report that it was agreed to
get type test certificates on the transformers which were missing from the best evaluated
bidders offer
The Evaluation team did not document areas that were waived during evaluation which
explains the inconsistencies between the Evaluation Report and the Administrative Review
Report.
6.0
DECISION OF THE AUTHORITY
M/s Spencon Services Ltd raised six grounds in their Application for Administrative
Review. The Authority has found merit in only one ground out of the six and in
accordance with Section 91 (4) of the PPDA Act and PPDA Regulation 347; the decision
of the Authority is that the application of Administrative Review by M/s Spencon
Services Ltd is not upheld although their bid is still valid, it was not
compliant/technically responsive to the technical requirements in the Solicitation
Document. The decision of the Authority is based on the findings of the Authority in 4.0
above
In accordance PPDA Regulation 12 (2) and in view of the irregularities noted in the course of
the administrative review process, the decision of the Authority is that the Accounting
Officer of Rural Electrification Agency should;
6.1 Cancel the current procurement process in accordance with the procedure under
PPDA Regulation 95, inform all the four bidders of the cancellation and return their
bid securities.
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6.2 Undertake the necessary technical consultations to revise the Solicitation Document
and ensure that the statement of requirements contains clear and unambiguous
requirements that clearly spell out the mandatory requirements.
6.3 Re-tender the procurement using the Restricted Bidding method with a reduced
bidding period of ten (10) working days with the eighteen (18) firms that purchased
the earlier Solicitation Document.
6.4 Appoint an Evaluation Committee composed of different individuals from the ones
that evaluated the bids received under the earlier procurement process.
6.5 Investigate why M/s Spencon Services Ltd and M/s Marma Technical Services were
not recorded on PP Form 30 and yet were evaluated contrary to PPDA Regulation
147 (1).
6.6 Verify from Uganda Revenue Authority the authenticity of the letter of no objection
(Annex 7) submitted by M/s Ferdsult Engineering Services Ltd as an equivalent of a
Tax Clearance Certificate.
7.0
CORRECTIVE MEASURES
I: The Procuring and Disposing Entity- Rural Electrification Agency
7.1
In accordance with Section 9 of the PPDA Act, the Authority recommends that
the Accounting Officer of Rural Electrification should implement the following
corrective/disciplinary measures –
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Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 28 of 30
(a) Replace the Head of the Procurement and Disposal Unit due to the serious
breaches/professional negligence noted in the following(i)
Failure to customize the Standard Bidding Document issued by PPDA
contrary to Section 62 (1) of the PPDA Act; in particular requiring bid
validity in terms of calendar days instead of the standard of working days
prescribed by the Authority.
(ii)
Failure to advise the Accounting Officer on the bid validity before it
expired thus resulting in the Entity and Bidders incurring further costs and
delays in project implementation due to the re-tendering of the
procurement process.
(iii)
Failure to manage Evaluation process contrary to PPDA Regulation 58 (e).
This lead to a number of anomalies in the evaluation process in particular
the failure to record the non material omissions by bidders that were
waived by the Evaluation Committee and the non equal treatment of
bidders contrary to PPDA Regulation 183 (7) as well as failure to record
non material omissions that were waived the evaluation of bidders not
listed on PP Form 30 contrary to PPDA Regulation 147 (1).
(b) Caution the individual members of the Contracts Committee for omissions noted in the
following(i)
Failure to ensure that the solicitation document was prepared in
accordance with standards set by PPDA contrary to PPDA Regulation 48
(a).
(ii)
Failure to ensure that any evaluation criteria classified as non material by
the Evaluation Committee was consistently applied to all bids and
recorded as part of the Contracts Committee minutes contrary to PPDA
Regulation 53 (4).
(c) Caution the individual members of the Evaluation Committee for omissions noted in
the followingReport on Application for Administrative Review to PPDA under Section 90 of PPDA Act 1 of 2003 and Regulation 347in the Tender For Construction of 33kv
Lines and Associated Low Voltage Networks Procurement Ref: REA/WRKS/09-10/00008 Page 29 of 30
i. Failure to adhere to the evaluation criteria stated in the solicitation document.
ii. Conducting the evaluation of bids in an unfair manner contrary to Section 45 of
the PPDA Act and in particular PPDA Regulation 183 (7);
iii. Evaluation of bidders who were not listed on PP Form 30 as having bought the
solicitation document directly from the PDE contrary to PPDA Reg. 147 (1).
(d) Caution the Project Consultant (M/s Multi-Konsult Ltd) contracted by the Entity to
provide technical advice to the procurement process for their failure to prepare clear and
unambiguous technical specifications that precisely define the requirements in a manner
that leaves no doubt or assumption by the bidders.
II The Complainant:
As a Bidder, M/s Spencon Servcies Ltd should always adhere to the
requirements/specifications given under Bidding Document for the specific
procurement or seek clarification at any scheduled pre-bid meetings in accordance with
PPDA Guideline 2/2005.
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