TIP clarification

[Naveed Yaseen]

KARACHI (September 14 2009): TIP has issued following clarification: Transparency International Pakistan has only quoted from the press reports. In order to obtain authenticated documents from public bodies, TIP has been writing to PPIB, NEPRA and WAPDA to provide the Evaluation reports and Contract Agreement to TI Pakistan.

In this regard, we invite every one to visit TI Pakistan website http://www.transparency.org.pk, where all correspondence with Privatisation Commission, PPIB, NEPRA WAPDA is made available for transparency purposes. On this website we have also posted all correspondence held with Pakistan Power Resources (PPR).

Monitoring implementation of law is one of the basic objective of Transparency International Pakistan. To achieve our objective, TI Pakistan has even gone to court, and the latest example is Court orders of Implementation of Karachi Building Control Authority Rules for Builder and developers as public is being harassed by builders and not giving the due rights of unit buyers.

A Constitutional Petition No D-1559 of 2009 was filed on 27 July 2007, and Sindh High Court (SHC) has ordered Karachi Building Control Authority (KBCA) to post all documents relating to building/development Projects on its website within one week. TI and its National Chapters have engaged in a wide range of advocacy activities across regions to contribute to the negotiation and adoption of several anti-corruption conventions.

They also promote signature, ratification, implementation into law, and translation into policy and practice of anti-corruption conventions in their respective countries. These activities have included letters to and meetings with government officials, press releases and press conferences, letters to the editor and newspaper articles, public release of surveys and reports, radio and television broadcasts, and public workshops.

All information which were discussed with the staff reporter are based on reported news in the print media. Like on 14th August Dawn published a report "The tariffs of rental power plants and of IPPs are almost equal,' he said, adding that whereas the projects of independent power producers took five years to get going, rental plants became operational within eight months.

In case of KESC news non payment of Rs 7 billion dues of Gul Ahmed and Tapal IPP, the press is reporting this again and again, and TI Pakistan has also written to KESC and SECP on this and other issues of KESC. Even SECP has taken action and issued notice to KESC, and informed TIP, vide their letter No EMD/233/401/02-33 dated 5 August 2009.

Walter Power Plant: the contract agreement states that the electricity will be for supply to KESC. How the contract agreement can have a clause regarding KESC as the user, without any commitment from KESC. The clarification given by PPR does not deny the provision of mobilisation advance, severance guarantee, the total tariff being 15.99 cents, with Rent as 4.27 cents, and fuel cost at 12. 66 cents, at RFO @ Rs 26,000 per ton. At current cost of RFO @ Rs 49,000 per ton, and $ at Rs 83, the selling cost comes tom Rs 23. 34.

It may fluctuate lower in case of rupee appreciation and reduction in RFO prices, and vice versa will be higher in case of rupee depreciation and increase in RFO prices. According to Public procurement Rules 2004, every Contract of over Rs 10 million, shall include no bribery pact: Integrity Pact". This contract document is reportedly does not have signed Integrity pact, which is a commitment by contractor that in case any corruption is found in future, contractor will pay 10 times the amount of corruption. The actual commitment is;

Notwithstanding any rights and remedies exercised by GoP in this regard, [name of Supplier] agrees to indemnify GoP for any loss or damage incurred by it on account of its corrupt business practices and further pay compensation to GoP in an amount equivalent to ten time the sum of any commission, gratification, bribe, finder's fee or kickback given by [name of Supplier] as aforesaid for the purpose of obtaining or inducing the procurement of any contract, right, interest, privilege or other obligation or benefit in whatsoever form from GoP.

According to Public Procurement Rules 2004, Evaluation Reports are to be given to the bidders 10 days before award of Contract, and after the Award the Evaluation Report and Contract Agreement are to be made public, and for this purpose PPRA has notified that they shall be posted on PPRA website. TI Pakistan has not found them on PPRA website. Another rule No 50. states that any unauthorised breach of these rules shall amount to mis-procurement.

For this reason TI Pakistan has replied to PPRA to abide by all the procedures and also convince their client to abide by the Public Procurement Rules 2004 and supply the documents to TI Pakistan. Public Procurement t Regulatory Authority has also written in this respect to WAPDA on 30 July 2009 to furnish the documents to PPRA for examination and also to be posted on their website.

In order to eliminate corruption, the World Bank has also acclaimed TI Pakistan standing and expertise, and made TIP as observer in the SODA WSIP II Project, costing US $176 million, to make sure that all tenders are processed and awarded as per procurement rules, and report to World Bank its observations on each and every procurement. Even the Prime Minster and many procuring agencies have sought TI Pakistan rulings in tender evaluation and in one case TI Pakistan ruled that a Project worth US $3.5 Billion was not processed according to rules, and the tender which was provisionally awarded, was terminated on TIP's recommendations. The Three years rental sliding downward rates are also quoted from NEPRA documents. TIP confirmed whatever they have stated is based on facts and rules of PPRA.-PR