Nipping Nipdec

THE TERMINATION of a $15.1 million contract for the Valsayn Avenue Bridge by the procurement regulator is a startling turn of events.

It is a worrying development particularly because of the state entity involved, the National Insurance Property Development Company Ltd (Nipdec).

By order dated October 18, the Office of Procurement Regulation (OPR) directed the special-purpose state enterprise to quash the bridge contract due to contravention of the law.

The OPR found Nipdec had used bid evaluation criteria not disclosed to Kall Co Ltd, the company that objected to the award of the contract to another.

This is bad enough.

But Nipdec’s stated mission is “to be the premier project and procurement management agency.”

It is incredibly embarrassing that it finds itself subject to such an order given the scale of the project, how long it has had to prepare for the new regime, and its own troubled history when it comes to public works.

Nipdec is a wholly-owned subsidiary of the National Insurance Board, the entity that operates the country’s national insurance system. Its mandate has never squared comfortably with that relationship.

The company was mentioned a total of 169 times in the 2010 Report of the Uff Commission of Enquiry, which found serious failings.

For instance, as it related to two major projects, the commission damningly concluded, “Nipdec’s performance as project manager has been poor and generally ineffective.”

That was 14 years ago.

While Nipdec said in relation to the bridge contract that Kall Co Ltd failed in its bid due, in part, to the submission of vague information, it is the state entity itself that has been found wanting in its communication, failing to take the rudimentary step of seeking clarification from the contractor. It was an astonishing error for a company established decades ago.

The OPR’s sanction is one of the first real “meat and bones” orders of its kind as it relates to public works.

Previous terminations were issued against the award of state contracts involving consultancy services, peddler services, insurance brokerage and infrastructure works on land lots.

Between April 2023-April 2024, the regulator received a total of just 32 formal complaints, a low number considering its scope.

That may reflect the body’s well-publicised struggle to get state enterprises to comply with its rules.

The last word on procurement reform from the Prime Minister was merely to state non-competitive awards are allowed.

According to the OPR’s first-ever annual report tabled earlier this year, only six per cent of people are optimistic the new system will effect change.

Though a single order is merely the tip of the iceberg, the decision of the panel to issue this termination is a hopeful sign of even stronger regulation to come.