The Twentieth Annual Report of the Contractor-General
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THE TWENTIETH ANNUAL REPORT OF THE CONTRACTOR-GENERAL JANUARY TO DECEMBER 2006 THE TWENTIETH ANNUAL REPORT OF THE CONTRACTOR -GENERAL JANUARY TO DECEMBER 2006 PREPARED AND PUBLISHED BY THE OFFICE OF THE CONTRACTOR -GENERAL COPYRIGHT 2007 OFFICE OF THE CONTRACTOR -GENERAL OF JAMAICA Any reply or subsequent reference to this communication should be addressed to the Contractor-General and the following reference FFICE OF THE ONTRACTOR ENERAL quoted:- O C -G 17 KNUTSFORD BOULEVARD No . : P.O. BOX 540 TELEPHONE No . : 876-929-8560/6466 INGSTON FAX No. : 876-929-7335 K 5 JAMAICA , W.I. May 22, 2007 Senator The Honourable Syringa Marshall-Burnett, CD President of the Senate Houses of Parliament 81 Duke Street Kingston The Honourable Michael Peart, M.P. Speaker of the House of Representatives Houses of Parliament 81 Duke Street Kingston Dear Honourable Madame President and Honourable Speaker: In accordance with the provisions of Section 28 (2) of the Contractor General Act, I now have the good honour and privilege to submit to you, one hundred and ten (110) copies of the Twentieth Annual Report of the Contractor General for calendar year 2006. As you will recall, Section 28 (3) of the Contractor General Act calls for the Report to be “… submitted to the Speaker of the House of Representatives and the President of the Senate who shall, as soon as possible, have them laid on the Table of the appropriate House.” I therefore so advise and avail myself of this opportunity to renew to you, Honourable Madame President and Honourable Speaker, the assurance of my highest considerations. With many kind regards. Very respectfully yours, Greg Christie (Signed) _______________________ Greg Christie Contractor General OFFICE OF THE CONTRACTOR-GENERAL ANNUAL REPORT 2006 TABLE OF CONTENTS Page 1.0 CONTRACTOR-GENERAL‘S INTRODUCTORY REMARKS 1 2.0 MONITORING OF CONSTRUCTION CONTRACTS 27 3.0 MONITORING OF NON-CONSTRUCTION CONTRACTS, 54 LICENCES, PERMITS AND CONCESSIONS 4.0 QUARTERLY CONTRACT AWARDS (QCA) REPORTS 57 5.0 TECHNICAL SERVICES DIVISION 61 6.0 FINANCE AND ADMINISTRATION DIVISION 70 7.0 COMMUNICATIONS AND PUBLIC SECTOR PROCUREMENT TRAINING 73 8.0 INFORMATION SYSTEMS DEPARTMENT 76 9.0 APPROPRIATION ACCOUNT 80 APPENDIX I SUMMARIES OF INVESTIGATION REPORTS 85 APPENDIX II PRE AND POST- CONTRACT MONITORING 115 ACTIVITIES œ NINETY NINE SELECTED CASES APPENDIX III 2006 NCC ENDORSEMENTS OF CONTRACT 239 AWARD RECOMMENDATIONS APPENDIX IV CONSTRUCTION CONTRACTS MONITORED 347 APPENDIX V NON-CONSTRUCTION CONTRACTS MONITORED 371 APPENDIX VI OFFICE OF NATIONAL RECONSTRUCTION 389 APPENDIX VII STAFF TRAINING 397 1.0 CONTRACTOR-GENERAL‘S INTRODUCTORY REMARKS Opening Comments In keeping with the requirements of Section 28 (2) of the Contractor General Act, I am privileged to submit to the Parliament of Jamaica this, the 20 th Annual Report of the Office of the Contractor General. The Report addresses the execution of my statutory functions during calendar year 2006. Two thousand and six (2006) marks my first full year in Office as I was appointed Contractor General of Jamaica effective December 1, 2005. Perhaps it would be good, at the very outset, if I were to restate the principal functions of the Independent Commission of the Contractor General. These are the functions which every appointed Contractor General is bound by law, and by oath, to faithfully perform. The functions are mandated to be discharged — on behalf of Parliament “ and, by extension, on behalf of the People of Jamaica. As provided for by Section 4 (1) of the Contractor General Act, the prescribed statutory functions of a Contractor General are — to monitor the award and implementation of Government contracts with a view to ensuring (a) that such contracts are awarded impartially and on merit, (b) that the circumstances in which each contract is awarded or … terminated do not involve impropriety or irregularity, and (c) that the implementation of such contracts conforms to the terms thereof G. The Contractor General is also mandated by Section 4 (1) of the Act to monitor the grant, issue, suspension or revocation of any prescribed licence to ensure, inter alia , that the circumstances of the grant, etc. do not involve impropriety or irregularity. Additionally, Section 15 (1) of the Contractor General Act empowers a Contractor General to conduct formal investigations into certain matters. These include the registration of contractors, tender procedures, contract awards and the grant of licences. The power of the Contractor General to conduct an investigation is, however, a discretionary one. It is initiated only —if he considers it necessary or desirable “ to do so. Finally, in keeping with the provisions of Section 23J of the Contractor General Act, the Office of the Contractor General (OC-G) is obliged to perform a subsidiary support role as the provider of secretarial, administrative and technical resource services to the National Contracts Commission (NCC). As is well known, however, the NCC is, in all other respects, a separate, distinct and independent Statutory Commission. In 2006, the OC-G, despite operating within exceedingly constrained and pre-existing human and budgetary resource allocations, challenged itself to discharge the aforementioned functions in a more extensive manner than had ever before been attempted in the Organization‘s 20 year history. Looking back, I am happy to report that through the hard work of its two (2) Inspectorates, which comprised an average of nine (9) inspectors in 2006, its Technical Services Department, 1ONTRACTOR -GENERAL ANNUAL REPORT 2006 PAGE 1 its Information System Department and its Finance and Administration Department, the OC-G was successful in achieving all of the goals which it had set itself and more. These achievements were made possible by a committed and re-energized OC-G staff. They were driven and inspired, inter alia , by the OC-G‘s newly declared strategic and operating objectives of (a) transforming itself into a ”best in class‘ organization (b) preventing corruption in Government procurement, (c) ensuring compliance with the Government‘s Procurement Procedures and Guidelines and (d) significantly enhancing transparency and probity in the public sector contract award process. 2006 Operating and Performance Highlights Summary Outlined below are some of the principal operating and performance achievements which were accomplished by the OC-G in 2006. Development and Implementation of the Quarterly Contract Awards (QCA) Report Regime In 2006, the OC-G completely developed and implemented its Quarterly Contract Awards (QCA) Report Regime. This unprecedented and ground-breaking, anti-corruption initiative, has significantly enhanced the effective capacity of the OC-G to monitor and to investigate the procurement and contract award activities of the country‘s estimated 180 Procuring Public Bodies. Essentially, the QCA Regime requires every Procuring Public Body to submit to the OC-G, quarterly reports of particulars of contracts which are awarded by it in the value range of $250,000 to $3,999,999.99, commencing with contracts which are awarded as of May 1, 2006. Also included in the QCA Reports, are particulars which will indicate the extent to which each Public Body has complied with the Government‘s Procurement Procedures. QCA Reports are required to be submitted, by law, to the OC-G within 30 days of the ending of each calendar year quarter. They must be submitted on specially prescribed Excel electronic and hard copy forms. As the OC-G already has full access to the particulars of Government contract awards which are $4 Million and above in value, the QCA Report Regime has now positioned the Organization to directly monitor and/or investigate an estimated 10,000 Government contract awards annually in a value range of $250,000 to infinity. The Regime will also allow the OC-G to publish the actual Reports on its website and, by so doing, secure a level of transparency, over the Jamaica public sector procurement process, which was previously considered to be unattainable. The OC-G‘s objective is to commence the full publication of all submitted QCA Reports by April 2007. The full impact of the OC-G‘s QCA Report Regime is discerned when one takes into consideration the fact that prior to its gestation in 2006, the OC-G‘s physical contract monitoring capability was demonstrably limited to only ~300 contracts per annum. 1ONTRACTOR -GENERAL ANNUAL REPORT 2006 PAGE 2 Conduct of Special Investigations The OC-G completed fifteen (15) special investigations in 2006 (not including investigations which were related to Government land divestment matters). By comparison, in the preceding three (3) year period, only two (2) special investigations were completed by the Organization. It is also instructive to note that, during the year, reports for eight (8) of the subject fifteen (15) investigations were submitted by the OC-G to Parliament, pursuant to the discretionary powers which are reserved to the Contractor General by Section 28 (2) of the Contractor General Act. Pursuant to Section 28 (4) of the Act, the complete content of these reports were also made public by the OC-G. The full reports are currently available for viewing, or for download, from the OC-G‘s website at www.ocg.gov.jm . There were seven (7) other special investigations which were commenced by the OC-G in 2006. These investigations are scheduled for completion in calendar year 2007. Verbatim extracts of the executive summaries of the reports of investigation into the referenced fifteen (15) matters, together with other related particulars, are detailed in Appendix I to this Report. A formal enquiry into a Government land sale matter was also conducted and completed by the OC-G in 2006. The matter is discussed in the Contractor General‘s Introductory Remarks section of this Report under the heading: Divestment and Sale of Government-Owned Lands and Assets. Efforts to Restructure the OC-G During early 2006, several formal representations were made to the Government to secure the restructuring of the OC-G.