News / Local
BCC loses $300k to briefcase companies
09 Feb 2016 at 05:42hrs | Views
THE Bulawayo City Council lost more than $300,000 in botched ambulance and vehicle tracking system deals to two briefcase companies.
The Deputy Minister of Local Government, Public Works and National Housing Christopher Chingosho revealed how the local authority was failing to recover $303,000 paid as deposit in two separate deals for a fleet of ambulances and the installation of a tracking system
Chingosho was responding to questions posed by Nketa MP Phelela Masuku in the National Assembly.
The MP wanted to know why it has been impossible to track down the companies.
The Deputy Minister said the municipality paid $100,000 deposit for the vehicle tracking system and $203,106,40 for the ambulances.
"On the issue of installation and the commissioning of the vehicle tracking and a fleet management system, council tendered out for the supply, installation and the commissioning of vehicle tracking and a fleet management system in 2010. The tender was awarded to Tracker Engineering Private (Ltd). A company incorporated and its address duly incorporated. Its address of service was in Harare," said Chingosho.
"The contract price was US$501,500 and council was supposed to pay a deposit of US$100,000 and the balance was to be paid within a period of 36 months. The deposit was paid in the sum of US$100,000 and Tracker then started requesting for extension and relaxation of certain clauses in the contract," said Chingosho.
He said the company disappeared and its e-mails started bouncing back.
"Their telephone numbers were no longer reachable. We took the matter to court and have since obtained a judgment which is ready to be implemented as soon as we locate them. Council tried to use the services of a tracking agent, but we reached a dead end," said Chingosho.
He said they will continue to search for the company so that the $100,000 deposit which was paid could be recovered.
"Council awarded the contract to Tracker because they had favourable conditions and a flexible payment plan. They had a good back-up system and had promised to work with the council until the system was up and running," added the Deputy Minister.
He said on the supply and delivery of ambulances, council tendered out for the supply and delivery of four ambulances in 2010 and the tender was awarded to Access Medical Corporation.
"The contract price for these ambulances was $341,844. The terms of the tender were that council was to pay 60 percent deposit and the rest over 12 months. The 60 percent deposit was paid, which was $203,106,40 and the unit price of each ambulance was $85,461 and the deposit paid was sufficient to pay for two ambulances," he said.
The Deputy Minister said after paying the deposit, Access Medical kept promising that the ambulances would be delivered to no vail.
"There were several correspondences between the supplier and council and they just vanished after realising that legal action was now being taken against them. Meanwhile, we had handed over the matter to our lawyers after realising that the supplier wasn't cooperating.
"Efforts to serve them with summons were unsuccessful because they were nowhere to be found. Well continue searching and using the services of private investigators to trace them. The contract price wasn't paid in full. It was 60 percent deposit"
He justified the engagement of the companies, saying they offered favourable payment terms.
"It's important to note that these contracts were in 2010 soon after the introduction of the multicurrency and council was operating on a cash budget Council's cash flows weren't good and the idea was to try and buy these ambulances on credit and then pay in instalments.
"All the other tenderers wanted cash on delivery and so we then opted for this tenderer who could give council terms. All the other tenders, which came after these were strictly cash on delivery to avoid further loss," said the Deputy Minister.
He said all the necessary procedures were taken into consideration and the companies appeared to be the best amongst others.
The Deputy Minister of Local Government, Public Works and National Housing Christopher Chingosho revealed how the local authority was failing to recover $303,000 paid as deposit in two separate deals for a fleet of ambulances and the installation of a tracking system
Chingosho was responding to questions posed by Nketa MP Phelela Masuku in the National Assembly.
The MP wanted to know why it has been impossible to track down the companies.
The Deputy Minister said the municipality paid $100,000 deposit for the vehicle tracking system and $203,106,40 for the ambulances.
"On the issue of installation and the commissioning of the vehicle tracking and a fleet management system, council tendered out for the supply, installation and the commissioning of vehicle tracking and a fleet management system in 2010. The tender was awarded to Tracker Engineering Private (Ltd). A company incorporated and its address duly incorporated. Its address of service was in Harare," said Chingosho.
"The contract price was US$501,500 and council was supposed to pay a deposit of US$100,000 and the balance was to be paid within a period of 36 months. The deposit was paid in the sum of US$100,000 and Tracker then started requesting for extension and relaxation of certain clauses in the contract," said Chingosho.
He said the company disappeared and its e-mails started bouncing back.
"Their telephone numbers were no longer reachable. We took the matter to court and have since obtained a judgment which is ready to be implemented as soon as we locate them. Council tried to use the services of a tracking agent, but we reached a dead end," said Chingosho.
He said they will continue to search for the company so that the $100,000 deposit which was paid could be recovered.
"Council awarded the contract to Tracker because they had favourable conditions and a flexible payment plan. They had a good back-up system and had promised to work with the council until the system was up and running," added the Deputy Minister.
He said on the supply and delivery of ambulances, council tendered out for the supply and delivery of four ambulances in 2010 and the tender was awarded to Access Medical Corporation.
"The contract price for these ambulances was $341,844. The terms of the tender were that council was to pay 60 percent deposit and the rest over 12 months. The 60 percent deposit was paid, which was $203,106,40 and the unit price of each ambulance was $85,461 and the deposit paid was sufficient to pay for two ambulances," he said.
The Deputy Minister said after paying the deposit, Access Medical kept promising that the ambulances would be delivered to no vail.
"There were several correspondences between the supplier and council and they just vanished after realising that legal action was now being taken against them. Meanwhile, we had handed over the matter to our lawyers after realising that the supplier wasn't cooperating.
"Efforts to serve them with summons were unsuccessful because they were nowhere to be found. Well continue searching and using the services of private investigators to trace them. The contract price wasn't paid in full. It was 60 percent deposit"
He justified the engagement of the companies, saying they offered favourable payment terms.
"It's important to note that these contracts were in 2010 soon after the introduction of the multicurrency and council was operating on a cash budget Council's cash flows weren't good and the idea was to try and buy these ambulances on credit and then pay in instalments.
"All the other tenderers wanted cash on delivery and so we then opted for this tenderer who could give council terms. All the other tenders, which came after these were strictly cash on delivery to avoid further loss," said the Deputy Minister.
He said all the necessary procedures were taken into consideration and the companies appeared to be the best amongst others.
Source - chronicle
