News / National
Outcry over Zesa security tender
22 Jun 2019 at 15:55hrs | Views
INDIGENOUS security companies have cried foul over the steep bidding fees charged for participating in a Zimbabwe Electricity Transmission and Distribution (ZETDC) tender.
ZETDC, a subsidiary of Zesa, recently invited bids for the provision of security services at its various premises all over the country, including Seke, Chegutu, Nyanga, Marondera, Rusape and Broomley.
Interested bidders were asked to pay a security deposit of US$4 000 or equivalent in RTGS dollars, yet some of the contracts were valued at ZWL$10 000.
"The bidding system is very disadvantageous to small companies. They require us to advance a huge amount of money, which will be refunded after 90 days," an official at one of the companies said.
"However, the power utility did not take it into cognisance that the local currency is losing value everyday due to high inflation. US$ 4000 is equivalent to around ZWL$24 000 on the interbank market rate and after 90 days, this money will be worthless. Again, to get US$4 000, one has to go to the parallel market.
So, whoever structured this tender wants to exclude us the smaller players."
A ZETDC standard bidding document for the provision of security services in possession of NewsDay showed that bidders were required to pay US$4 000 or the RTGS dollar equivalent.
"The bidder must include either a bid security of US$4 000 or RTGS dollar at the prevailing interbank rate that shall be valid for a period of 90 days after the tender closing date in the form of a certified bank cheque, a bank guarantee or cash deposit," part of the document read.
"If a cash deposit is chosen, bidders must pay US$4 000 or RTGS currency at the prevailing interbank rate for the bid security that shall be refundable at the end of the bidding period, plus another US$200 or RTGS dollar equivalent at the prevailing interbank rate that shall be non-refundable for cash bid establishment fee in line with part IV of the regulations."
Under the tender, security companies are supposed to make quotations in US dollars, but will be paid in RTGS dollars using the interbank market rate.
Another security company official said the bidding period which opened on June 10 and closes on July 11 was too brief, considering that to prepare for the entire bidding document, a company had to fork out around ZWL30 000.
"Considering that US dollar cash is hard to get in the county, it means security service providers are going to pay the security bid in RTGS dollars. With this high inflation, by the time we are going to be refunded the money will already have been eroded. It will be next to nothing, which is very unfair to us," the official said.
A Zimbabwe Indigenous National Security Association official, who also requested anonymity, said the organisation was inundated with calls from its members over the issue.
"From the history of ZETDC, their tenders are promulgated in a biased nature. It is clear that they are made to outdo some members. If the tender is targeting a particular company, they would have made prior arrangements in that regard," the official said.
Zesa spokesperson Fullard Gwasira said the deposit was a statutory requirement. "In fact, the figure was reduced from US$6 000 to US$4 000 in the interest to accommodate small companies and further empowerment. Deposits are normally required to protect public funds," he said.
ZETDC, a subsidiary of Zesa, recently invited bids for the provision of security services at its various premises all over the country, including Seke, Chegutu, Nyanga, Marondera, Rusape and Broomley.
Interested bidders were asked to pay a security deposit of US$4 000 or equivalent in RTGS dollars, yet some of the contracts were valued at ZWL$10 000.
"The bidding system is very disadvantageous to small companies. They require us to advance a huge amount of money, which will be refunded after 90 days," an official at one of the companies said.
"However, the power utility did not take it into cognisance that the local currency is losing value everyday due to high inflation. US$ 4000 is equivalent to around ZWL$24 000 on the interbank market rate and after 90 days, this money will be worthless. Again, to get US$4 000, one has to go to the parallel market.
So, whoever structured this tender wants to exclude us the smaller players."
A ZETDC standard bidding document for the provision of security services in possession of NewsDay showed that bidders were required to pay US$4 000 or the RTGS dollar equivalent.
"The bidder must include either a bid security of US$4 000 or RTGS dollar at the prevailing interbank rate that shall be valid for a period of 90 days after the tender closing date in the form of a certified bank cheque, a bank guarantee or cash deposit," part of the document read.
"If a cash deposit is chosen, bidders must pay US$4 000 or RTGS currency at the prevailing interbank rate for the bid security that shall be refundable at the end of the bidding period, plus another US$200 or RTGS dollar equivalent at the prevailing interbank rate that shall be non-refundable for cash bid establishment fee in line with part IV of the regulations."
Under the tender, security companies are supposed to make quotations in US dollars, but will be paid in RTGS dollars using the interbank market rate.
Another security company official said the bidding period which opened on June 10 and closes on July 11 was too brief, considering that to prepare for the entire bidding document, a company had to fork out around ZWL30 000.
"Considering that US dollar cash is hard to get in the county, it means security service providers are going to pay the security bid in RTGS dollars. With this high inflation, by the time we are going to be refunded the money will already have been eroded. It will be next to nothing, which is very unfair to us," the official said.
A Zimbabwe Indigenous National Security Association official, who also requested anonymity, said the organisation was inundated with calls from its members over the issue.
"From the history of ZETDC, their tenders are promulgated in a biased nature. It is clear that they are made to outdo some members. If the tender is targeting a particular company, they would have made prior arrangements in that regard," the official said.
Zesa spokesperson Fullard Gwasira said the deposit was a statutory requirement. "In fact, the figure was reduced from US$6 000 to US$4 000 in the interest to accommodate small companies and further empowerment. Deposits are normally required to protect public funds," he said.
Source - newsday
