$3.55B paid to Courtney Benn, subsidiary for works on vessels, supplies of spares

─received advances as much as 220 per cent above Tender Board ceiling
─companies failed to submit all relevant documents
─no verification of works by MARAD prior to payments

Courtney Benn Contracting Services Limited (CBCSL) and its subsidiary, Brenco Shipping Company, have benefitted from $3.55 billion in contracts for the procurement of spares and equipment and docking and rehabilitation of vessels, representing 92 per cent of the total amount paid during the period 2015-2020.

This revelation was made in the recently published special internal audit undertaken by the Ministry of Public Works – Work Services Group into the workings of the Maritime Administration Department within the then Ministry of Public Infrastructure.

The audit examined contract awards and spending on vessels rehabilitation and acquisition of spares.

Major findings

There was no breakdown of the $3.55 billion contracts due to missing Bill of Quantities (BOQ). A BOQ is a document that provides a detailed list of the work to be done and the costs associated with every aspect of the project.

The auditor noted that while the Guyana National Industrial Company, submitted its documents, including the BOQ for its $108.1 million contract for the docking and rehabilitation of the MD Steven ‘N’, Courtney Benn and its subsidiary failed to do so even after many requests were made.

Exorbitant mobilisation advances

The Report also revealed that MARAD paid the two companies as much as 92 per cent in mobilisation advances, representing 220 per cent above the 30 per cent ceiling set by the National Procurement and Tender Administration Board (NPTAB).

This $70.59 million mobilisation advance for the $72.59 million contract was for the supply and installation of Met Ocean Buoy. The contract was signed February 3, 2020 and no bond was presented for scrutiny.

In one instance, although it was noted that an 80 per cent mobilisation advance would be paid on a $400.2 million contract for the acquisition of spares for vessels, 100 per cent of the amount was paid without variation or justification.

All other contracts awarded to the two companies that were examined, showed mobilisation advances paid out between 50 to 95 per cent.

Further, none of the contracts had either a mobilisation or performance bond presented for scrutiny.

To this end, the auditor noted that MARAD therefore, “assumed massive risk with those large payments, coupled with the lack of bonds.”

The way forward

Among a host of recommendations made by the internal auditor is for penalties to be attached for persons found “culpable through dereliction of duties or wilful acts to the detriment of the agency.”

Those penalties, the auditor said should match the nature of the infractions.

On February 8, Minister of Public Works Hon. Bishop Juan Edghill formally requested the Auditor General to conduct a forensic audit of MARAD.  The Minister said gift-purchasing and MARAD’s financing of other activities were worrying.

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